The role of Bitcoin as a store of value continues to strengthen, with new forecasts from Fidelity highlighting just how significant institutional accumulation could become over the next decade. According to their projection, as much as 42% of Bitcoin’s circulating supply could turn illiquid by 2032 due to treasury holdings, long-term investors, and institutional custody solutions. This scenario would mark a critical shift in Bitcoin’s market structure, potentially driving long-term scarcity and boosting its valuation case.
Bitcoin’s Supply Dynamics
Bitcoin has a hard cap of 21 million coins, a defining feature that distinguishes it from traditional assets and fiat currencies. As of 2025, more than 19.7 million BTC have already been mined, leaving less than 1.3 million coins to enter circulation over the next century.
Fidelity’s analysis suggests that corporate treasuries, exchange-traded funds (ETFs), and sovereign wealth funds could significantly lock away circulating coins. This illiquidity occurs when Bitcoin moves into cold storage or long-term custodial accounts, effectively removing it from active trading markets. If 42% of supply becomes inaccessible for short-term liquidity, price discovery could increasingly hinge on a much smaller pool of available BTC.
Treasury Accumulation as a Key Driver
The last few years have seen companies like MicroStrategy, Tesla, and other institutions embrace Bitcoin as a treasury reserve asset. This corporate adoption trend has only accelerated with the approval of spot Bitcoin ETFs, which have already funneled billions into the market.
As more institutions view Bitcoin as a hedge against inflation, a store of value, or a portfolio diversifier, treasury accumulation becomes a self-reinforcing cycle. The fewer coins that remain liquid on exchanges, the greater the upward pressure on price during demand surges.
Long-Term Implications for Investors
If nearly half of Bitcoin’s supply becomes illiquid by 2032, market volatility could present in sharper extremes. On one hand, scarcity could support significant price appreciation. On the other, sudden liquidity shocks such as large holders moving assets could trigger outsized market reactions.
For retail investors, this scenario underscores the importance of long-term holding strategies. As liquid supply tightens, “stacking sats” gradually becomes more difficult, and entry prices for late adopters may rise considerably.
Fidelity’s Bullish Outlook
Fidelity’s forecast reflects a broader institutional optimism toward Bitcoin’s role in the global financial system. If its prediction materializes, Bitcoin could increasingly resemble digital gold, functioning as both a hedge and a strategic reserve asset. The concept of illiquidity turning into a bullish driver is not new, but formal acknowledgment by major financial players lends additional credibility to the thesis.
Takeaway
The prediction that 42% of Bitcoin’s supply could become illiquid by 2032 highlights the asset’s shifting trajectory from speculative instrument to institutional-grade reserve. With growing adoption among corporations and asset managers, scarcity is poised to redefine Bitcoin’s long-term value proposition. For investors, the path ahead may be marked by fewer liquid coins, heightened competition for supply, and an ever-stronger case for Bitcoin as a global store of value.
