FameEX Hot Topics | Fidelity: 8.3M Bitcoin to Become Illiquid by 2032, Bitcoin Scarcity to Skyrocket

In a significant new analysis, financial giant Fidelity has projected that long-term Bitcoin holders and corporate treasuries are on track to lock away over six million BTC by the end of 2025. This substantial removal of coins from the actively traded supply is expected to create a notably tighter market, which could have profound implications for Bitcoin's price dynamics by fundamentally altering its supply-and-demand equilibrium.

The firm's report, published on Monday, identified these two key groups based on a strict criteria of consistent accumulation. Fidelity classified a supply as "illiquid" if it had increased each quarter or at least 90% of the time over the past four years. The first cohort consists of steadfast long-term holders who have not moved their Bitcoin from their wallets in at least seven years—a group whose collective supply has not decreased since 2016. The second is composed of publicly-traded companies holding vast treasuries of at least 1,000 BTC, which have largely held strong despite a single quarter of selling in mid-2022.

Looking even further into the future, Fidelity makes a bolder prediction: a staggering 8.3 million BTC could become illiquid by the second quarter of 2032. This figure was calculated by extrapolating the historical growth rate of the long-term holder cohort over the past decade, without even factoring in potential new corporate adopters. The firm estimates that by 2032, this would mean that nearly 42% of Bitcoin's entire circulating supply would be effectively locked away and considered illiquid.

The combined holdings of these two groups are already colossal. At the end of the second quarter, they collectively held Bitcoin worth approximately $628 billion at an average price of $107,700—a figure that has doubled since last year. This immense concentration of wealth raises a critical question for the market: what would happen to Bitcoin's price if these whales decided to sell? Indeed, recent data shows whales have offloaded nearly $12.7 billion in BTC over the past month, contributing to a price dip and marking the largest sell-off since mid-2022.

Ultimately, Fidelity’s analysis underscores a powerful long-term narrative for Bitcoin: accelerating institutional adoption coupled with deeply entrenched diamond hands is systematically reducing the available supply. While short-term volatility from whale movements is inevitable, the overarching trend points toward an increasingly scarce asset, potentially setting the stage for significant price appreciation as the liquid supply continues to shrink.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.