Bitcoin’s illiquid supply has reached 14.3 million BTC, about 72% of the roughly 19.9 million BTC in circulation, according to Glassnode. This shift reflects a preference for long-term holding and reduces the amount of BTC ready for immediate trading. The change has potential implications for liquidity and price, affecting traders, custodians, and institutional investors.
Context and impact of the illiquid supply
Whales and long-term holders (LTH) are driving the accumulation, absorbing a volume equal to almost 300% of recent mining output. This focused demand has shrunk the liquid supply available on exchanges and favored self-custody practices alongside corporate treasury approaches, reducing the immediate availability of Bitcoin for the spot market.
Institutional alignment is intensifying: Fidelity projects that LTHs and corporate treasuries could hold more than 6 million BTC by 2025, while experts observe a 30% increase in the combined holdings of corporate strategic reserves and ETF issuers in 2025. The analysis also cites Bitcoin at CA$145,247.10 to contextualize the degree of illiquidity relative to current market value. An illiquid supply is the portion of BTC with little spending history and is therefore not ready for immediate trading.
Implications
Price pressure: a smaller liquid float can amplify price movements if demand persists, as fewer coins are readily available to meet bids. Volatility and liquidity: reduced BTC on exchanges lowers order book depth and raises the risk of slippage during periods of heightened activity.
Concentration risk: market pricing becomes more sensitive to the decisions of large holders and corporate treasuries as they command a greater share of supply. Institutional relevance: the growth of corporate reserves and ETFs strengthens Bitcoin’s link with regulated products and traditional portfolios.
The next scheduled milestone is the halving on March 26, 2028, which will affect mining supply and may interact with illiquidity trends in ways worth monitoring. In summary, the rise in illiquid supply points to less available liquidity and a greater influence of large actors in price formation, according to the cited data.
