Story Highlights
With daily institutional demand far exceeding the supply of newly mined Bitcoins, Bitcoin prices broke through $122,600.
BlackRock's IBIT ETF has reached an asset management scale of $84 billion, holding over 700,000 Bitcoins.
The dollar's 11% decline has enhanced Bitcoin's appeal as a hedge against inflation and a spending tool.
Trump's supportive stance on cryptocurrency and trade tariffs have led investors to view Bitcoin as a safe haven.
Bitcoin prices soared to a new high of over $122,600, once again becoming the center of attention. While other cryptocurrency markets are enjoying positive gains, Bitcoin's rise feels different; it is not just increasing but is almost in a straight line upward every day.
So, what exactly is driving this surge? Where will Bitcoin go next?
Institutional demand and limited supply
One of the biggest reasons behind Bitcoin's price surge is the growing demand from institutional investors. Bitwise's investment director, Matt Hougan, stated that there is a tug-of-war between huge buying interest and the extremely limited daily supply of Bitcoin.
For example, only 450 new Bitcoins are mined each day, but just yesterday, the spot ETF absorbed 10,000 Bitcoins. This is not a typo, but rather a demand that is 20 times higher than supply. This imbalance is a major factor driving the rapid increase in Bitcoin prices.
BlackRock's IBIT ETF sets a record
BlackRock's Bitcoin ETF (IBIT) has become an important force in the market. Last week, the ETF's asset management scale reached $84 billion, achieving this level in just 200 trading days. In contrast, the gold ETF (GLD) took over 15 years to reach a similar scale.
IBIT currently holds over 700,000 BTC, making it the largest holder to date, with nearly 100,000 BTC more than its closest competitor.
Dollar falls, Bitcoin rises
Against the backdrop of rising interest rates and an 11% drop in the dollar in just six months, Bitcoin has soared over $15,000 since early July. This sudden surge largely occurred after the U.S. House of Representatives approved President Trump's 'Big Beautiful Law' on July 3.
For many, this indicates that large expenditures will continue, making Bitcoin, often seen as digital gold, appear more attractive.
Geopolitical tensions have also played a role. U.S. President Donald Trump has made a strong return and shown positive support for cryptocurrencies. Recently, Trump imposed a 50% tariff on copper and enacted punitive measures against Brazil.
What is the next step for Bitcoin?
Some market observers say that Bitcoin has now entered what they call 'crisis mode.' Meanwhile, Jeff Kendrick, head of digital asset research at Standard Chartered Bank, stated that Bitcoin prices could reach $135,000 by the end of the third quarter and possibly $200,000 by the end of the year.
However, Bitwise's Matt Hougan also believes that if the current strong demand and limited supply gap continues, Bitcoin's price could rise to the $200,000 mark by the end of this year.
