Bitcoin's Post-Halving Demand to Be 5x Greater Than Supply, Bitfinex Estimates

Analysts at Bitfinex estimate that the new BTC supply added to the market could drop to $30 million per day, amounting to less than five times the average daily inflows into the spot-based ETFs.recent mining reward halving has altered the market in such a way that it could potentially lead to cryptocurrency's demand being five times greater than that of supply, according to the latest projection by analysts at the crypto exchange Bitfinex.

"With the daily issuance rate declining post-halving, we estimate that the new supply added to the market would amount to approximately $40-$50 million in USD-notional terms based on issuance trends. It is expected that this could possibly drop over time to $30 million per day, including active and dormant supply as well as miner selling, especially as smaller miner operations are forced to shut down shop," analysts at Bitfinex said in a report shared with CoinDesk.

The supply squeeze has already begun. Since halving, the total number of new coins added to the supply daily has dropped to 450 BTC from the pre-halving four-year average of around 900 BTC, data from Glassnode show.Nearly a dozen spot-based ETFs began trading in the U.S. on Jan. 11, allowing investors to take exposure to cryptocurrency without owning it. Bitfinex is assuming that the average daily inflows into ETFs since inception will remain constant in the coming months.

Lastly, according to Bitfinex, investors are again increasingly taking direct custody of their coins, weakening the market's supply side.

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