Blockchain

90% of Total Supply of Bitcoins Mined, Robust Supply Shock Might be Inevitable

With a 21 million cap, 90% of Bitcoin’s total supply has already been mined, given that the coins in circulation stand at 18.89 million.

On-chain analyst Dylan LeClair explained:

“90% of the 21,000,000 BTC have now been mined. Current annual inflation of 1.88%, and programmatically declining for the next 119 years. Absolute scarcity.”

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As the global monetary network evolves, cryptocurrencies are witnessing an uptick in usage and awareness. For instance, a recent Visa study noted that 94% of financial decision-makers were aware of cryptocurrencies. Moreover, the research stated that building wealth and a financial future were the key drivers of crypto usage and ownership.

Therefore, with only 10% of Bitcoin supply remaining unmined, a robust supply shock might become inevitable as demand for the leading cryptocurrency continues to scale the heights.

For example, Europe leads in terms of global crypto distribution with at least $5 trillion worth of cryptocurrencies received in a span of a year. 

The inverse relationship between Bitcoin and the USD

According to crypto analyst Matthew Hyland:

“The US Dollar plays a pivotal role in Bitcoin bull markets. When the US Dollar is in a bear market, Bitcoin sees its maximum gains a key signal for a USD reversal into a Bear Market would be bearish divergence being formed on the 2-week time frame. we still await confirmation.”

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Research shows that Bitcoin and the US dollar are inversely correlated because, in most cases, BTC rises when the dollar’s strength decreases.

For instance, as Bitcoin closed in 2020 with a 295% gain,  the US Dollar Index (DXY) slipped to a 32-month low. 

Meanwhile, Bitcoin has recently dragged between $47K and $50K levels. Crypto experts believe the bull market might not be triggered until the primary token returns to the $53K level.

Image source: Shutterstock



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