Bitcoin's (BTC) 21 million supply cap won't help stop the selloff: Crypto Daybook Americas
The scarcity appeal of Bitcoin's 21 million supply cap is being undermined by synthetic supply from ETFs and derivatives, fueling the current selloff.Summary
Despite Bitcoin's core pitch of a hard 21 million supply cap, the ongoing bear market is raising skepticism about its scarcity appeal. Analysts argue that alternative investment vehicles like ETFs, cash-settled futures, and prime-broker lending create a "synthetic supply" by allowing investors to gain exposure without owning the underlying asset. Veteran analyst Bob Kendall suggests this financialization means the asset is no longer truly scarce, turning price action into a derivatives game rather than a pure supply-and-demand market, similar to what happened with gold and oil. Consequently, on-chain metrics relying on raw scarcity may be misleading. The selloff, which saw Bitcoin drop below $70,000, is characterized by some as coordinated institutional selling, with forecasts ranging from a slide below $60,000 to a deeper drop toward $38,000, especially given its strengthening correlation with struggling tech stocks.
(Source：CoinDesk)