Bitcoin is experiencing the biggest crisis in history: a supply crisis

Bitcoin: Supply Crisis Fully Erupting—Where Has BTC Gone?

90,000 to 200,000, even 1 million USD—is it a dream? Is it hype? Or is it the logic of monetary deflation?

If you still think that the current Bitcoin price of over $90,000 is already high, then you might completely overlook a super trend quietly happening that could change Bitcoin’s destiny—Supply Squeeze.

And this crisis is not caused by miners, nor by exchange bankruptcies, but by: Bitcoin on global exchanges evaporating wildly as if being drained, while users are not selling but locking into cold wallets.

This is not panic, but an on-chain version of extreme faith.

This is not the top, but the opening act of a super bull market.

On December 6, 2025, Bitcoin hovers around $92,000, but the total BTC held by exchanges has fallen to: 2,095,000 coins (down 22.4% from the beginning of the year).

What does this mean?

It means: the selling pressure pool has been emptied, and the buying pressure pool is being squeezed.

It means: miners produce 450 coins daily, ETF absorbs 10,000 coins per day.

It means: as supply diminishes and demand becomes crazier, $200,000 is just a natural number, not an emotional fantasy. $1 million is no longer a dream, but a reflection of value!

Every past dip: essentially aimed to drain BTC from exchanges and retail holders, forcing you to hand over your chips. This has led to the lowest BTC wallet balances in history.

Next, Yang Qi will take you through an in-depth analysis:

1. Exchange BTC Holdings Plummet

— The First Trigger of the Supply Crisis

1. CEX holdings collapse: Where is Bitcoin truly disappearing?

On-chain data (21 top exchanges):

Recent 30-day net outflow: 43,000 BTC

Past 6 months net outflow: 209,000 BTC

Full-year 2025 net outflow: 668,000 BTC

This is the largest exchange inventory collapse since the 2022 FTX crash. But the key point is: this is not panic withdrawals, but inventory disappearing—not sold, but withdrawn.

On-chain data shows:

BTC entering cold wallets hits a new high

Long-term holdings account for over 85% (unprecedented)

BTC unmoved for over 1 year exceeds 70%

BTC unmoved for over 3 years exceeds 50%

In other words: the current BTC market has entered a “complete shortage” mode.

2. Why are people madly withdrawing coins? Not fear, but strengthened faith

The reason is not the common distrust of exchanges in recent years. Look at the data: USDT reserves hit a record $4.28 billion; exchange total assets hit a new high; exchange operations remain stable, with no collective risk events.

The only reason users withdraw BTC: hoarding. Dead. It.

Long-term investors, institutions, whales are transforming BTC from a trading asset into a reserve asset, moving from hot wallets to cold wallets, from “liquid assets” to “permanent assets.”

With supply continuously shrinking, a dangerous structure appears: floating supply dips below cycle lows → buy orders can be easily pushed into “vacuum.”

3. Historical replay: every time exchange inventory drops → BTC explodes upward

2016–2017: exchange inventory drops from 3 million → 2 million → BTC rises from 1,000 to 20,000 (20x)

2020–2021: inventory falls below 2.5 million → BTC rises from 8,000 to 69,000 (8x)

And now: inventory falls below 2.1 million, lower than levels in 2017 and 2020.

This is an unprecedented market signal: more “dry” than any previous bull start. Supply dries up → easier to ignite → explosive growth.

2. Macroe Storm Approaching,

Bitcoin Becomes the Only “Anti-Fragile Asset”

The supply crisis itself is stimulating enough, but what truly drives BTC is macro factors.

1. Global liquidity begins to return: capital tide is thawing

M2 has rebounded for two consecutive quarters:

Global M2: +5.8%

US M2: +3.2%

Stablecoin market cap YTD growth: over 25+

Why is this important? Stablecoins = digital dollars = BTC dry powder

M2 rebound = macro liquidity returning to asset markets

Historical规律极其稳定：只要 M2 转正，比特币平均涨幅超过 300%。

目前，美联储正从 QT 边缘退却，全球进入去美元化背景下的“温和再宽松”阶段。

2）Interest rate decline → stocks and bonds unstable → BTC attracts capital

Real interest rates fall from 5% to 3.5%; USD index DXY weakens; December rate cut probability approaches 90%

How will capital flow? → Not into US Treasuries (yield collapse) → Not into stocks (bubble high) → Not into gold (growth plateau)

Only flowing into “truly scarce assets”: BTC. BTC’s elasticity is 8-10 times that of gold.

3）US debt crisis makes BTC a “hedge insurance” against the dollar system

US debt exceeds $35 trillion, with annual interest payments over $1.3 trillion, entering a “rollover” era. The Fed dares not continue tightening, nor can it raise rates early to push down debt.

In this context, giants like BlackRock and Fidelity agree: BTC will become a strategic asset to hedge systemic US debt risks.

Think about it: gold market cap is $29.56 trillion

BTC is only $1.82 trillion

If BTC absorbs only 15% of gold’s liquidity → $300,000

If it absorbs 30% → $500,000; 50% → $1,000,000

Sound crazy? Then isn’t the 60x increase in gold over the past 50 years even crazier?

3. Institutional Battle for Coins:

ETFs Are the Real Nuclear-Level Capital Attractors

The main demand for BTC now is no longer retail, but institutions.

1. ETF: absorbs the equivalent of 20 days of miner production daily

Data (2025): Miner daily output: 450 coins; ETF daily net buy: 10,000 coins

A simple math: 1 day ETF = 22 days of miner output; 1 week ETF = half a year of miner output

Does supply still matter? No. This is naked【supply and demand crushing】.

2. Institutional allocation: just beginning, but terrifying strength

Public fund BTC allocation: 2023: 1.2%, 2024: 2.7%, 2025: 4.07%

What is the target level? → 10–12% of gold. This data comes from the world’s largest asset manager, BlackRock, and the second-largest, Vanguard.

If BTC accounts for 10–12% of institutional portfolios, it means: at least $3.6 to $4 trillion will flow into BTC.

What does this mean? → Current total BTC market cap is $1.8 trillion, → equivalent to the market cap increase of two Bitcoins; → prices will multiply, with at least $300,000 being feasible.

4. Future Path Projection: From $90,000 to $300,000,

Not only possible, but the most probable route

Based on on-chain, macro, and capital flow analysis, three stages of prediction:

1. Short-term (1–3 months): Break $117k, a key level.

Driving forces: ETF capital inflow, continuous decline in CEX holdings, market returning to risk appetite

Key breakout: Once above $117k, a new big trend begins.

2. Mid-term (Q2–Q3 2026): $160k–$180k

Driving forces: Rate cuts materialize, pension funds and sovereign funds officially enter, sovereign nations increase BTC reserves

Bernstein model forecast: ETF inflow of $50 billion → BTC price $200k

3. Long-term (2026): $220k as the baseline

Why is $220k the baseline and not the peak? Because shrinking supply + expanding demand = nonlinear price structure.

If scenarios like QE return (probability increasing): stopping QT from December, QE is not far away?

Hayes: $250k

Tom Lee: $200k–$250k

Cathie Wood: million-dollar (long cycle)

You can view this Bitcoin cycle in a longer perspective: $500k in 5 years is not a problem, $1 million in 10 years. Not worrying about today’s dips or tomorrow’s stagnation.

When the real rise begins, what you need to confirm is: you are still at the table!

5. Conclusion: Today’s Bitcoin is not a “speculative asset,”

but a “time machine”

The BTC market in 2025 has three certainties:

1. Supply exhaustion, irreversible: CEX holdings hit a 7-year low, whale lock-up rate hits a record high.

2. Macro structural tilt, safe-haven demand will explode: debt crisis, rate cut cycle, liquidity normalization.

3. Institutional coin grabbing war begins, demand will grow exponentially: ETF is a historic-level capital pump, never stopping.

Reduced supply + surging demand = prices can only go up, not down.

In the coming years, you will see:

More people hoarding coins, fewer able to buy.

Exchange inventories becoming emptier, Bitcoin becoming more expensive.

What you see is not speculation, but a migration of global asset structures.

If you are still hesitating at this stage, remember one thing: the greatest returns in history always go to those who wake up first. **$PAXG **