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Bitcoin’s Illiquid Supply Reaches New Highs
According to observations from the on-chain data platform Glassnode, Bitcoin’s “illiquid supply” has reached an all-time high.
This signifies that an increasing amount of BTC is being stored in wallets that have not been used for a long time, remaining in a non-trading state. This reflects a growing tendency among market participants to “hold” rather than trade frequently. This not only reduces the circulating supply in the market but also lays the groundwork for potential supply shocks in the event of rising demand for prices in the future.
Bitcoin’s CAGR Continues to Decline
On the other hand, crypto analyst Willy Woo has recently released an observation of a noteworthy trend: the annualized return rate (CAGR) of Bitcoin is continuously declining, indicating that BTC is transitioning from a phase of rapid growth as a “magical unicorn” to a stage of gradually rationalized asset pricing.
He pointed out that since 2017, the annualized return rate of Bitcoin has decreased from several hundred percent to the current level of 30-40%, with a continuing downward trend. Woo emphasized that this critical change occurred in 2020, marking the key point of Bitcoin’s “institutionalization,” when not only companies like MicroStrategy entered the market in large numbers, but sovereign nations also began to allocate reserves in Bitcoin. With an increasing amount of long-term capital entering, Bitcoin is being viewed by the market as the first new “global macro asset” in 150 years, gradually absorbing global liquid capital until achieving value equilibrium.
Regarding future trends, Willy Woo suggests that under the backdrop of a long-term annual growth rate of around 5% in global money supply and approximately 3% in GDP, Bitcoin’s annual growth rate is expected to stabilize at around 8%. He believes that the formation of this trend may take another 15 to 20 years, but before that, BTC will continue to be one of the strongest long-term investable assets. Willy Woo stated:
“Enjoy the journey. Even though the CAGR is declining, there are currently almost no publicly traded market products that can match Bitcoin’s long-term performance.”