A new report by Fidelity Digital Assets makes for fascinating reading. Research analyst Zack Wainwright has done a deep dive into how Bitcoin’s illiquid supply is ushering in a new era for investors — led by two key factors: early adopters holding onto their sats for years on end, and a wave of publicly traded companies snapping up as much BTC as they can afford.
The author argues that this could lead to “a new era in Bitcoin’s history,” especially considering Satoshi Nakamoto’s holdings of 1.1 million BTC now eclipses the remaining coins that are left to be mined. Noting how the early days of crypto were marked by faucets where people could claim 5 BTC for free — a sum that would now be worth over $500,000 — Wainwright says scarcity will soon replace abundance.
It’s a pretty bullish piece overall, but there’s one important detail buried in the report that is worth highlighting: the race to accumulate Bitcoin on a massive scale could eventually backfire, and lead to unprecedented price pressures should the treasury companies decide to sell some of their stash and bank profits.
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Given the returns they’ve enjoyed over the past year, you could argue they’d be stupid not to. As the report says:
“As of June 30 2025, this cohort held over $628 billion at a Bitcoin price of $107,700 — more than double the value held at this time last year. With such substantial unrealized gains, the question arises: Will these holders begin to take profit? Early signs of potential capitulation may already be emerging, as 80,000 ancient Bitcoin — BTC that has not moved for 10 years or more — were sold in July 2025.”
Wainwright goes on to warn that the sudden movement of large amounts of illiquid BTC have the potential to spook the markets. We have been down this road before. When Tesla unveiled plans to sell most of its holdings a few years ago, Bitcoin fell precipitously, with some interpreting this transaction as a sign that Elon Musk was losing confidence in this digital asset’s potential.
Overall though, the author’s prognosis is pretty positive. Fidelity’s estimates suggest that whales who have held Bitcoin for at least seven years — and firms with at least 1,000 BTC in their wallets — will collectively own more than six million coins by the end of this year. He notes that this amounts to 28% of the total supply. And when you consider millions of coins have already been lost (exact estimates differ here) that means there’s even less in circulation for everyday investors.
Pointing to the staying power of whales — and their determination to hold on to assets come bear and bull markets — he wrote:
“The first cohort — Bitcoin last moved seven or more years ago — has proven to be highly illiquid, as their total portion of the Bitcoin supply has increased every quarter-over-quarter since tracking became possible in 2016.”
That’s a pretty impressive statistic. And while publicly traded companies haven’t been adding BTC to their balance sheets for the past seven years (MicroStrategy started accumulating five years ago) they seem to have similar levels of resolve.
“This cohort has only experienced one quarter-over-quarter decrease in total supply since 2020, and it collectively holds over 830,000 BTC as of June 30, 2025.”
Here’s what worries me though: most of these purchases have happened very suddenly — over the past 12 months. Back in the third quarter of 2024, the total amount of Bitcoin snapped up by these businesses had barely exceeded 300,000 BTC.
Strategy’s savvy decision to start amassing BTC at bargain basement prices means that its average cost price per coin remains pretty low — about $73,913 as of its latest acquisition on Monday. This means prices could fall by over 30% from current levels and Michael Saylor’s empire would still be in the green.
Other, later adopters don’t have this luxury, with some only entering the market once Bitcoin has broken beyond $90,000 or even $100,000. This means they’re much more exposed in the next eventual downturn. Let’s not forget BTC cratered by more than 75% between 2022 and 2023 in the year following FTX’s collapse. Forced selling could make this bear market even worse.
Wainwright believes that BTC’s recent run to fresh all-time highs of $124,000 is directly down to “new demand coupled with a fixed supply and decreased issuance schedule” — and there are other untapped opportunities still out there.
“Over time, the scarcity of Bitcoin may become the focal point as more entities buy and hold the asset long term. If nation-state adoption increases and the regulatory environment surrounding Bitcoin continues to evolve, the growth of the illiquid supply could be even more dramatic than what has been detailed above.”
But remember: BTC buyers can become sellers in the blink of an eye.
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