Strategy, a company heavily focused on Bitcoin holdings, is acquiring BTC at a rate that exceeds what miners are producing — effectively driving the leading cryptocurrency into deflation, says Ki Young Ju, CEO of CryptoQuant.
In a May 10 post on X, Ju stated that Strategy’s Bitcoin stash — now at 555,000 BTC — remains locked up with no plans to liquidate, contributing to an estimated annual deflation rate of -2.23%. He added that when considering other long-term institutional holders, the rate could be even more pronounced.
Michael Saylor, Strategy’s executive chairman and co-founder, has long championed Bitcoin’s scarcity and promoted it as a superior store of value, prompting numerous firms to adopt similar treasury strategies.
Strategy doesn’t just buy and hold BTC — it also plays a crucial role in bridging traditional finance (TradFi) and the crypto space. The company raises capital through corporate debt and stock offerings, channeling those funds into further Bitcoin purchases. According to Saylor, over 13,000 institutional investors currently hold shares in Strategy.
Market observers continue to monitor Strategy’s moves, which are having a noticeable impact on Bitcoin’s price trends. By pulling large quantities of BTC out of circulation, the firm helps tighten supply, potentially lifting prices and softening market swings.
A Shift in Bitcoin Supply Dynamics Driven by Institutions
Adam Livingston, author of The Bitcoin Age and The Great Harvest, likens Strategy’s aggressive buying to a “synthetic halving” — referring to Bitcoin’s built-in supply cuts every four years. He notes that while miners generate around 450 BTC daily, Strategy is acquiring approximately 2,087 BTC each day — over four times the production rate.
The institutional wave doesn’t stop there. From hedge funds to tech firms, more organizations are integrating Bitcoin into their financial strategies, often as a hedge against inflation or as a portfolio stabilizer.
Meanwhile, Bitcoin ETFs are absorbing capital from legacy markets, helping to temper the asset’s notorious price swings and making downturns less steep.
However, the largest institutional players — sovereign wealth funds — are still waiting on the sidelines. According to SkyBridge Capital founder Anthony Scaramucci, these entities won’t move in until the U.S. introduces comprehensive crypto regulations. Once that regulatory clarity is achieved, he predicts a flood of large-scale institutional buying that could drive Bitcoin’s price even higher.
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