Bitcoin Price Stagnant Despite Institutional Demand Due to In-Kind Transfers

Fundstrat Global Advisors co-founder Tom Lee, renowned for his optimistic outlook on Bitcoin (BTC), recently provided insights into why the cryptocurrency has not seen a significant price increase despite growing institutional demand.

Lee highlighted that US spot Bitcoin ETFs have experienced strong inflows, indicating unprecedented demand for Bitcoin. However, he noted that the price of Bitcoin has not risen as expected, despite this demand. Lee attributed this price stagnation to the method by which some institutional investors are acquiring Bitcoin through ETFs. He explained that some corporate entries are made through "in-kind" transfers, where investors move their existing Bitcoin holdings from cold wallets to the ETF manager's wallet, rather than purchasing new BTC. This process does not create new buying pressure on Bitcoin, and thus does not drive the price up.

Lee described this process as a "neutral transfer," stating that since no new Bitcoins are being purchased, the price remains relatively stable. He emphasized that the price of Bitcoin follows a simple demand-supply mechanism, and the lack of new purchases means there is no significant impact on the price.

Lee's analysis comes amidst a complex market environment where Bitcoin has maintained its position above $107,000 following a record-breaking monthly close in June. The cryptocurrency achieved a significant milestone by closing June at approximately $107,100, marking its highest monthly close in history. This surpasses previous record monthly closes of $104,600 in May and $102,450 in January. Lee's perspective is supported by technical analysis, which suggests that Bitcoin could climb to new all-time highs, potentially testing levels around $115,000. The analysis also indicates that Bitcoin usually rises around 8% in July. If seasonality and historical patterns hold true in 2025, there could be a move toward nearly $116,000 from the July opening levels, which were slightly above $107,000. However, a failure to hold the lower boundary of the consolidation zone, around $102,000, could invalidate this bullish scenario. If that level is breached, the next support is the psychological $100,000 mark, followed by the 200-day EMA at approximately $95,000, and the late-April lows near $92,000.

Lee's analysis also highlights the influence of institutional developments on Bitcoin price dynamics. A cryptocurrency company recently raised $220 million from private investors to expand its Bitcoin mining operations and treasury holdings. Notably, $10 million of this raise was conducted directly in Bitcoin rather than U.S. dollars, with an average acquisition cost of $104,000 per coin. This development reflects growing institutional confidence in Bitcoin as both an operational asset and treasury reserve.

Despite the complex market environment, experienced investors continue to accumulate Bitcoin, aiming for a long-term target of $1 million per BTC. Prominent market figures continue expressing bullish long-term views on Bitcoin price. The author of Rich Dad Poor Dad, maintains his prediction that Bitcoin will reach $1 million by 2030. He has recently purchased additional Bitcoin despite acknowledging the speculative nature of his investment. His 2025 price targets range from $180,000 to $350,000. Other analysts provide varying long-term projections, with ARK Invest suggesting a bull case of $1.5 million per Bitcoin by 2030, with more conservative estimates ranging from $300,000 to $710,000. These projections assume continued institutional adoption, regulatory clarity, and Bitcoin's evolution as “digital gold.”