The newly mined supply of Bitcoin is being effectively constrained by the company’s rapid accumulation, it is argued by author Adam Livingston.
Michael Saylor’s strategy is being described as “synthetically halving Bitcoin” by consistently purchasing half or more of the newly minted supply from miners each month, according to Adam Livingston, a BTC analyst and author of The Bitcoin Age and The Great Harvest.
It was stated by Livingston that miners are currently producing around 450 BTC per day, or approximately 13,500 BTC each month, while Strategy has acquired 379,800 BTC over the past six months. This equates to roughly 2,087 BTC being purchased per day by the firm — significantly surpassing the daily output from miners. It was further added by the author:
When Bitcoin becomes this scarce, access to Bitcoin will require paying a premium. Lending against Bitcoin will cost more. Borrowing Bitcoin will become a luxury business reserved for nation-states and corporate whales, and Strategy will control the bottleneck.
It was further explained by Livingston that the global cost of capital for BTC will no longer be determined by “the market,” but instead will be influenced by the gravitational policies of the first Bitcoin superpower: Strategy.
The prediction made by the author regarding a Bitcoin supply crunch suggests that significantly higher BTC prices could be seen if Strategy is able to maintain its pace of BTC acquisitions while demand for the supply-limited digital asset continues to grow among institutional and retail investors.
A Bitcoin supply crunch has been predicted by the author, suggesting that much higher BTC prices could be realized if Strategy’s pace of BTC acquisitions is maintained while market demand for the supply-capped digital asset increases among institutional and retail investors.
It was predicted by Cypherpunk and Blockstream CEO Adam Back that Strategy, along with other institutions implementing a Bitcoin corporate treasury strategy, will drive BTC’s market capitalization to $200 trillion.
It was written by Back in an April 26 X post that “Strategy and other treasury companies represent an arbitrage of the dislocation between Bitcoin’s future and today’s fiat world.”
Warnings have been issued by critics of the company that the debt-driven strategy for acquiring BTC could financially endanger Strategy if a prolonged BTC bear market occurs. Concerns have also been raised about greater systemic risks to BTC resulting from such a high concentration of the digital asset being controlled by a single entity.
However, it was recently stated by Bitcoin advocate and author Saifedean Ammous that Strategy’s concentration of BTC does not pose a threat to the protocol.
It was argued by Ammous that institutions such as BlackRock and Strategy, despite holding large concentrations of BTC, would be unable to engineer a hard fork to increase Bitcoin’s maximum supply, as doing so would significantly devalue their holdings — assets that ultimately belong to shareholders who possess the authority to divest.
