Although Bitcoin has gained 2 percent in value in the last week, it is having difficulty maintaining this rise due to the supply-demand balance in the market and rising real interest rates. The recent slowdown in inflows to spot ETFs is interpreted as a weakening of institutional interest. Additionally, the growth in stablecoin supply has stopped, indicating that new fiat money inflows have decreased.
Decline in institutional demand and miner supply
The total supply of Bitcoin is increasing with an average production of 450 new Bitcoins per day after the April 2024 halving, where the reward of 3,125 BTC per block continues in line with the current protocol calendar. In this process, the “absorption rate” used by Bitfinex regarding institutional demand has decreased significantly in recent times. While it was at 5.3 at the end of February, this rate has now decreased to 1.3.
The report emphasizes that demand is still slightly above new supply from miners, but this difference has narrowed considerably. While it was stated in the analysis that the demand moved to the passive category at this level, it was stated that a strong and continuous capital inflow, as in the end of 2024 and the first half of 2025, is required in order to see a meaningful increase again.
Bitfinex analysts stated, “The current rate of 1.3 puts the market in the passive absorption band. Here, demand can only slightly exceed miner supply.”
Rising US interest rates and their impact on Bitcoin
The rise in the yields of US Treasury bonds and inflation-indexed securities suppresses interest in cryptocurrencies. The yield of the 10-year inflation-indexed bond (TIPS) increased to 2.02 percent following the geopolitical developments during the year; This rate reached 2.12 percent last week, reaching the highest level since June 2025.
When these real returns increase, capital outflow from risky and non-returnable assets may accelerate. The fact that Bitcoin is seen as both a risky technology asset and “digital gold” by some investors causes it to be affected by this pressure in two ways. Investors are turning to instruments that provide fixed income as an alternative.
In the Bitfinex report, it was stated that “Without the Fed’s interest rate cut and increase in liquidity, the increase in real yields creates a serious flight from non-return instruments such as Bitcoin.”
There is an expectation in the markets that real interest rates will remain high in the near term. It is expressed that this situation is likely to continue to support the current situation.
Michael J. Kramer, founder and CEO of Mott Capital Management, mentioned that 10-year US real interest rates are rising rapidly and pointed out that the expectation of tightening in financial markets is getting stronger. He emphasized that the increase in oil prices in particular further narrowed the general financial conditions.
Kramer evaluated, “The rise in oil prices tightens financial conditions, and this process is expected to be effective as oil continues to rise.”
