VanEck points to a significant supply squeeze in Bitcoin despite muted trading volumes in early 2026. Their analysis reveals that 60.8% of circulating Bitcoin has not moved on-chain for more than a year, marking an unusually high level of dormancy in the market.
This figure, derived from on-chain metrics similar to those used by Glassnode, measures the supply held by long-term holders. VanEck interprets this as a sign that Bitcoin is increasingly seen by investors as a macro asset rather than a trading instrument. The implication is that sell pressure may remain subdued, setting the stage for a market environment where available supply is limited.
Major institutions such as VanEck, BlackRock, and Fidelity have launched spot Bitcoin ETFs, collectively holding hundreds of thousands of BTC under custody. This institutional demand effectively removes a large portion of Bitcoin from active order books, tightening the supply further.
However, this concentration could increase price volatility if liquidation events occur, since fewer coins are freely available for trading. Fund managers and investors face risks linked to these liquidity dynamics, especially with ETFs and corporate treasuries channeling inflows into Bitcoin.
Despite these concerns, Bitcoin's role as collateral in financial markets strengthens its position beyond mere speculation. The market's current dormancy aligns with broader macroeconomic uncertainty and ongoing institutional accumulation, which could keep retail trading activity low throughout 2026.
Looking ahead, key catalysts influencing Bitcoin's price will include US interest rate decisions and ETF flow patterns in the third quarter. These factors will likely shape how the supply squeeze impacts market behavior in the coming months.
Bitcoin ETFs nearing $1 billion with growing inflows illustrate this institutional appetite in action, complementing VanEck's observations about supply constraints.
Market reaction has been relatively calm so far, with Bitcoin prices showing limited movement amid the supply tightness.
