Bitcoins Illiquid supply has reached its highest level since 2014 as JUST 22% of the total supply are available to trade right now, nearing the Supply Shock level.

How are Crypto prices even calculated? Well, here we have two simple factors that help calculating every price, anywhere on earth. The supply and demand. Especially Bitcoin is often praised for its very good supply part of this and it seems to be only getting better. The illiquid supply of Bitcoin has just eclipsed the 78% level, making the illiquidity the highest it has ever been since 2014.

The illiquid supply is the part of the Bitcoin supply that did not move and is completely unavailable to trade right now as it is probably in cold storage through its holders. Basically, as long as you hold 75% of the BTC you ever purchased your holdings will be considered illiquid.

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Illiquid Supply metric with chart from therationalroot on Twitter

As we can see on this chart, the illiquid supply has been climbing up since this whole bear market even started. Which is quite contrary to what we had in the 2018 bear market where the illiquid supply had been declining constantly and only took of with the bull market starting. This also shows how in this bear market holders are just not selling at all.

So does this mean the possible Supply Shock will boost prices up? As I said at the start of this, the price is calculated through two factor, he supply and demand. Having a very scarce supply is good but it won‘t help as long as there is no demand. Demand + Supply Shock is what can make prices pump a lot.