Bitwise CEO Hunter Horsley has again highlighted Bitcoin scarcity, stressing that it is the rarest of all assets established as a store of value.
Bitcoin’s scarce property has been a defining factor in its rise to global adoption. It has also been a premise at which enthusiasts stress the intrinsic and long-term viability of the pioneering cryptocurrency.
Hunter Horsley, the CEO of Bitwise and a Bitcoin maximalist, highlighted this sparing characteristic in a Monday tweet. He branded the crypto leader the “scarcest store of value in the world,” stressing its superiority to traditional value hedges like gold.
Bitcoin’s Scarce: Horsley
Horsley presented this theory by comparing Bitcoin’s annual supply with that of gold and fiat currencies. The CEO emphasized that while these asset classes have seen a tangible supply increase over the last many years, Bitcoin has grown scarcer with time.
For perspective, he shared that the global fiat monies have appreciated 14% annually for the last 60 years. According to him, its supply would take five years to double in value, with the dynamics contributing to possible devaluation.
The same goes for the US money supply, which has grown at an average rate of 7.4% in the past six decades. At the rates, he mentioned that it would take 10 years for the US dollar supply to grow 100%. Meanwhile, with gold’s 1.5-2% yearly growth, its supply will double in 36-48 years.
However, Bitcoin’s supply increases by a mere annual rate of 0.84%, the least among other stores of value. Furthermore, its supply deflationary model means the number of BTC created decreases over time through the automatic halving event.
Meanwhile, with 19.8 million BTC out of the supply cap of 21 million already in circulation, the asset would only increase by 6% in its entire existence, further reestablishing its scarce nature.
Bitcoin Nears Supply Shock
Interestingly, the existing Bitcoins are already becoming difficult to acquire, as self-custody and long-term wallets are drying up the supply. For perspective, the amount of BTC on centralized exchanges recently dropped to a five-year low below 14% as enthusiasts continue to accumulate.
Furthermore, large players like Strategy (formerly MicroStrategy) and Metaplanet have resolved to stack sats incessantly, further jeopardizing supply. The former recently acquired 15,355 BTC ($1.42 billion), taking its holdings to 553,555 BTC ($52 billion).
With demand trouncing supply at this rate, Bitcoin may soon experience a supply shock, which could severely impact asset prices. Meanwhile, Horsley earlier stated that there would not be enough Bitcoin for everybody to buy, with Bitwise stressing that governments willing to gain exposure to the asset would have to buy from individuals willing to sell.
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