Bitcoin News Today: Bitcoin Surges 1.82% as Institutional Demand Rises and Supply Tightens

Bitcoin’s price climbed above $116,800 in early August 2025, driven by growing institutional demand and tight exchange liquidity, as supply constraints and regulatory developments shape market dynamics [1]. The cryptocurrency rebounded by 1.82% following a short-term correction, with improved trading volumes and investor sentiment supporting the rally. Major altcoins also advanced between 2.6% and 4%, suggesting broader participation in the market [2].

The tightening supply environment has been a key driver of Bitcoin’s upward trajectory. Limited sell-side liquidity on major exchanges like Binance has created upward price pressure, while subdued limit order volumes indicate a thin order book and the potential for heightened volatility [3]. These conditions have encouraged institutional accumulation, particularly as the ongoing halving cycle restricts the supply of new BTC entering the market [3].

Institutional confidence has surged, with Harvard University allocating $116 million into Bitcoin ETFs, a move that underscores the growing acceptance of digital assets in traditional finance [4]. Harvard’s investment into BlackRock’s IBIT ETF has positioned Bitcoin as a core component of its equity portfolio, signaling a shift in institutional risk appetite [4]. This development comes despite a relatively soft July for Bitcoin ETFs, indicating that institutional investors remain committed to the asset class despite short-term fluctuations in inflows [4].

However, regulatory hurdles continue to impact market sentiment. Japan’s long-awaited entry into the crypto ETF market remains delayed due to ongoing legal challenges. SBI Holdings, a leading financial services firm, confirmed that no formal applications for a Bitcoin-XRP dual ETF have been submitted and that the product remains in the planning phase [1]. Regulatory clarity is still awaited under Japan’s Financial Instruments and Exchange Act, with SBI Holdings stating that any filing will follow legal revisions that align with financial and tax authority guidelines [1]. The delay has not yet caused a significant selloff but has dampened near-term bullish momentum, shifting attention to markets with clearer regulatory frameworks.

Meanwhile, institutional activity has expanded beyond ETFs. Recent filings reveal that Davis Selected Advisers added 144,130 shares of a real estate investment trust, reflecting a broader trend of capital movement into alternative assets, including cryptocurrencies [4]. This diversification strategy highlights the increasing role of digital assets in institutional portfolios, especially amid elevated volatility in traditional markets.

Market sentiment is also shifting toward cautious optimism. The return of a “Greed” sentiment index suggests that traders are anticipating a period of consolidation and gradual price discovery. Bitcoin gained 1% on August 7, reaching $114,298, with the index indicating a stabilizing environment for long-term positioning [5].

Despite the positive developments, uncertainty persists. The lack of regulatory clarity in key markets continues to introduce a risk premium into pricing models. Institutional investors are closely monitoring these developments, as regulatory shifts could affect liquidity and overall market structure.

Bitcoin’s recent performance reflects a convergence of factors: constrained supply, rising institutional demand, and evolving market sentiment. While short-term volatility is expected, the underlying fundamentals suggest a strengthening case for long-term bullish positioning.

Sources:

[1] Research – blockscholes (https://www.blockscholes.com/research)

[2] Earnings call transcript: Canaccord Genuity misses Q1 2025 forecasts – Investing.com (https://uk.investing.com/news/transcripts/earnings-call-transcript-canaccord-genuity-misses-q1-2025-forecasts-93CH-4207924)

[3] Weekly Commentary: Anything But Normal Times – Seeking Alpha (https://seekingalpha.com/article/4811720-weekly-commentary-anything-but-normal-times)

[4] Davis Selected Advisers Purchases 144130 Shares of – MarketBeat (https://www.marketbeat.com/instant-alerts/filing-davis-selected-advisers-purchases-144130-shares-of-douglas-emmett-inc-nysedei-2025-08-08/)

[5] Crypto Newsletter, 24/7 Real-Time Market Updates, Global – CoinGlass (https://www.coinglass.com/newsflash)