Bitcoin has taken a surprising turn towards deflation, thanks to Strategy, a Bitcoin treasury company. As of May 10, 2025, CryptoQuant CEO Ki Young Ju reports that Strategy’s aggressive Bitcoin accumulation rate now surpasses the total output of Bitcoin miners, creating a staggering annual deflation rate of -2.33%.
Strategy’s Bold Moves
Strategy holds a hefty 555,000 BTC, with no signs of letting go. Ju wrote in a recent Xpost that the firm’s holdings alone contribute to a -2.23% annual deflation rate, potentially higher when factoring in other stable institutional holders. Michael Saylor, Strategy’s co-founder, is a well-known Bitcoin evangelist, encouraging other companies to integrate Bitcoin into their financial strategies. The company acts as a conduit between Bitcoin and traditional financial markets, selling corporate debt and equity to fund further Bitcoin acquisitions. Notably, over 13,000 institutions have incorporated Strategy’s stock into their portfolios, reflecting its influence. As explored in Strategy’s $84B Bitcoin Expansion Plan Backed by Wall Street Analysts, the company’s ambitious growth strategy is a key factor in its market impact.
Institutional Influence and Market Dynamics
Strategy is not just amassing Bitcoin; it’s reshaping the market. By acquiring more Bitcoin daily than miners produce—2,087 BTC compared to 450 BTC—it’s effectively creating a synthetic halving effect, according to Adam Livingston, author of “The Bitcoin Age and The Great Harvest.” This aggressive buying has led to dwindling miner reserves and has further cemented Strategy’s role in institutional adoption of Bitcoin.
Other institutional players—hedge funds, pension funds, and tech companies—are also jumping on the Bitcoin bandwagon. They view it as a portfolio diversifier and a hedge against fiat currency inflation. Meanwhile, ETF inflows are providing stability by injecting fresh capital from traditional financial markets, which has helped mellow Bitcoin’s notorious volatility. For a deeper understanding of Strategy’s financial maneuvers, see Strategy Raising Another $21B to Buy Bitcoin, Posts Large Q1 Loss on BTC Price Decline.
The Road Ahead
Yet, the path forward isn’t entirely smooth. Sovereign wealth funds, the titans of institutional investment, remain on the sidelines. Anthony Scaramucci, founder of SkyBridge, suggests that these heavyweight investors are waiting for clear cryptocurrency regulations in the United States before diving in. Once a comprehensive framework is established, Scaramucci predicts a substantial influx of Bitcoin purchases from these funds, potentially driving prices even higher.
As Bitcoin continues its journey into the mainstream financial world, Strategy stands at the forefront, reshaping the narrative and dynamics of the market. But questions linger: Can this deflationary trend sustain itself? Will regulatory clarity unlock the next wave of institutional investment? The answers could redefine Bitcoin’s future in the coming years.
Source
This article is based on: Bitcoin now deflationary due to Strategy's BTC purchases — Analyst
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
