Bitcoin Breaks Records with Decreasing Supply

On July 11, 2025, Bitcoin‘s price rocketed to a record $118,404, propelled by significant institutional interest and dwindling exchange reserves. This surge is supported by a steady influx of institutional funds, rising ETF investments valued at billions of dollars, and talks of the U.S. exploring the idea of maintaining a national Bitcoin reserve. A depreciating dollar and the anticipation of Federal Reserve interest rate cuts further enhance Bitcoin’s attractiveness as a hedge asset. Market observers, pointing to the Relative Strength Index (RSI) remaining below the overbought threshold, speculate that the next price milestone could hit $130,000.

What is Narrowing Bitcoin’s Supply?

Major asset managers like BlackRock, Fidelity, and VanEck have fueled the Bitcoin market by injecting significant resources into spot Bitcoin ETFs. Data from CryptoQuant confirms a growing trend of Bitcoin being moved off exchanges and into secure wallets, tightening the available supply. This movement from both institutional investors and individual buyers restricts Bitcoin’s circulating supply, heightening its scarcity.

As institutional fervor mounts, Bitcoin’s status as a “digital gold” is increasingly acknowledged, enriching long-term portfolios. The demand surge from ETFs soaks up current supply, while ongoing short position liquidations propel further price increases. The continuous decline of Bitcoin on exchanges amid rising global trade volumes renders Bitcoin progressively rare.

How Do Economic Factors Influence Bitcoin?

The blend of expected rate cuts by the Federal Reserve and a weaker dollar has bestowed Bitcoin with the reputation of a “safe haven”, significantly elevating its demand. The price range around $108,000, once a resistance zone, has shifted to a critical support level due to short but vigorous price rises.

From a technical standpoint, the RSI not yet hitting overbought levels suggests the price may continue to rise. A stable price above $120,000 could push Bitcoin into a discovery phase, aiming for $130,000. However, a dip below $107,000 might hint at potential price fatigue, though the broader economic landscape supports resilience and recovery.

Key insights include:

• Institutional investments are significantly affecting supply dynamics.
• Increasing ETF inflows consolidate Bitcoin’s position in long-term holdings.
• Technical indicators suggest potential for further price growth.
• The macroeconomic environment supports a robust Bitcoin market.

Despite potential fluctuations, Bitcoin’s current trajectory shows strong resilience supported by astute macroeconomic conditions, positioning it as a durable and valuable asset in modern financial portfolios.