Bitcoin Price Stagnates Despite Institutional Buying 857,000 BTC Demand Drop

Institutions have been actively purchasing Bitcoin, yet the market has not responded as expected. This phenomenon can be attributed to a significant decline in overall demand for Bitcoin, despite the continued institutional buying. Over the past month, there has been a notable decrease in ETF inflows and corporate purchases, which has contributed to the stagnation in the market. ETFs added around 40,000 BTC in the 30 days leading up to July 3, down from 86,000 BTC in December 2024. Strategy’s Bitcoin intake dropped even more dramatically, falling from 171,000 to just 16,000 BTC over the same stretch. The consistent buying by institutions removes Bitcoin from the open market, reducing the available float. However, this reduction in supply has not translated into a corresponding increase in price, indicating a broader market sentiment that is not aligned with institutional optimism.

On an annual basis, the pattern is even more telling: apparent demand is down 857,000 BTC, outpacing the combined 748,000 BTC accumulated by ETFs and Strategy over the same period. Analysts conclude that institutional inflows, while supportive, aren’t strong enough to fuel a new rally on their own. Without a broader resurgence in demand, Bitcoin is likely to remain stuck in a holding pattern—despite efforts by big-name buyers to push the price higher. The broader market is moving in the opposite direction. CryptoQuant estimates that total demand has contracted by 895,000 BTC in the past month—wiping out any bullish impact from institutional buying.

The recent price action of Bitcoin reveals a bullish bias, with the cryptocurrency consolidating near the $100,000 support level. Technical analysts note that this zone acts as a magnet for buyers, with moving averages trending upward. A break above $115,000 would signal a new leg higher, driven by momentum traders and algorithmic funds. The Relative Strength Index (RSI) remains neutral, suggesting room to rally before correction. Institutional adoption has been a significant driver of Bitcoin's price, with the approval of Bitcoin ETFs unlocking billions in capital. These ETFs now hold over $50 billion in assets, with inflows accelerating as volatility decreases. Political tailwinds, such as the creation of a “Strategic Bitcoin Reserve,” have further amplified this trend, drawing pension funds and endowments into the market.

Bitcoin thrives in environments of monetary uncertainty. The Fed's rate cuts in 2024 ignited a risk-on rally, with Bitcoin correlating more closely with equities than traditional safe havens. Today, with global inflation hovering near 4%, central banks remain cautious, creating fertile ground for Bitcoin's narrative as a hedge against fiat dilution. Supply-side fundamentals also favor bulls, with ~89% of Bitcoin's 21 million maximum supply mined. The network's energy-intensive consensus mechanism ensures scarcity, with each halving reducing new supply and amplifying upward price pressure. This structural deficit positions Bitcoin as a rare asset class with built-in scarcity, appealing to allocators in a world awash with liquidity.

However, no Bitcoin rally is without pitfalls. Regulatory uncertainty persists, particularly around tax treatment of crypto gains and potential overregulation. A sudden Fed rate hike or geopolitical shock could trigger a selloff. Traders should also watch the $95,000 support level; a breach here could signal a deeper correction. The confluence of technical resilience, institutional inflows, and macro tailwinds argues for a strategic long position in Bitcoin. Investors should accumulate Bitcoin on dips below $100,000, using dollar-cost averaging to mitigate volatility. A breach of $115,000 opens the door to $120,000+ by year-end, driven by Q4 holiday spending and ETF momentum. Setting a stop-loss below $95,000 can contain downside risk. Bitcoin's journey from $100 to $100,000 in 15 years has been defined by cycles of hype, panic, and adoption. Today, it stands at the cusp of a new chapter—one where institutional legitimacy and macro forces align to push prices higher. For investors willing to endure short-term swings, Bitcoin's blend of scarcity, technical strength, and macro tailwinds makes it a compelling long-term bet.