For every Bitcoin mined, 5.5 Bitcoins are being purchased by investors. The reason is that the market is very much bullish at this point.
This increased demand added pressure to the supply of Bitcoin, which is forecasted to apply upward price pressure. New data from James Van Straten indicates that investors buy Bitcoin 5.5 times faster than miners can bring it to the market. This thus implies that miners create an average of roughly 900 BTC every day, while investors buy up an average of about 4,950 BTC daily. The gap is, therefore, effective in creating a squeeze, which could ultimately push Bitcoin prices higher. Indeed, this is the case, and very much implies increased confidence in the future value of Bitcoin. The current ratio of buying to production is at an all-time high. Increased demand is, in part, due to institutional investors. Large institutional buyers are now pouring into the market, looking at Bitcoin as the ultimate hedge against inflation and the unknown, further cementing the reputation of Bitcoin as a form of digital gold.
Bitcoin miners are naturally active at work, constantly adding blocks to the chain. This steady pace of production relieves Bitcoin prices, but investors' demand is much higher than the supply. Analysts predict this will be the order of the day in the future as institutional investors realize the potential upside of Bitcoin investment. The increased acceptance of Bitcoin drives this spike in fever as a proper asset class. Miners themselves are instead in a precarious position. The recent Bitcoin halving has had them under the cosh. Reduced block rewards have squeezed miners' margins. In that regard, it is just too noticeable that most miners have had to sell off their BTC reserves to fund operational costs.
Selling pressure has been driving Bitcoin prices lower. In other words, the demand for Bitcoin has come to a new high today. With investors purchasing 5.5 times more than what the miners are producing, the increase coming out of the cryptocurrency market can be gargantuan. Such dynamics can further escalate the price of Bitcoin to brand-new appreciating levels, making it an even better investment.