BlackRock Warns Bitcoin Supply Insufficient for U.S. Millionaires

NEW YORK, March 5, 2025 – The world’s largest asset manager, BlackRock, has raised alarms about a potential Bitcoin supply shock, indicating that the current availability of Bitcoin is inadequate to fulfill demands from American millionaires. In a report titled “Why Bitcoin? A Perspective from Model Portfolio Builders,” analysts Michael Gates and Brett Wager highlight how Bitcoin’s supply is capped, contrasting it with gold, which can be mined in response to demand.

According to the report, Bitcoin operates under a predetermined monetary policy that restricts its supply to a maximum of 21 million coins, with approximately 19.83 million Bitcoin currently in circulation. The remaining coins will be gradually issued until 2140. However, BlackRock estimates that around 3 to 4 million Bitcoins are effectively inaccessible due to lost or forgotten keys, further reducing the practical supply.

“If every United States millionaire asked their financial advisors to acquire 1 BTC on their behalf, there would not be enough,” the report states, emphasizing the extreme scarcity of Bitcoin. This inelasticity strengthens Bitcoin’s potential as a store of value amidst economic uncertainties.

BlackRock maintains a positive outlook on Bitcoin’s future. Larry Fink, BlackRock’s CEO, previously suggested that the price of Bitcoin could soar to $700,000, reflecting a potential increase of 697% from its current valuation of $87,811.

The company has also made strides in the crypto space with its iShares Bitcoin Trust ETF (IBIT), which launched in January 2024. Despite facing a record outflow of $1.17 billion last week, the IBIT remains the largest Bitcoin ETF globally, boasting an assets under management (AUM) of $39.62 billion.

On Monday, the fund saw an additional $78 million withdrawal, though it did not report any inflows or further outflows on the following day. The share price for IBIT was $49.39 at press time, illustrating investor interest despite the volatility.

As the debate on cryptocurrency’s role in modern finance continues, BlackRock’s analysis underscores the shifting landscape of asset management, with Bitcoin emerging as a significant consideration for portfolios aimed at diversification and risk management. Investors are advised to conduct thorough research before making decisions related to Bitcoin investments.