Institutions are buying Bitcoin (BTC) at more than five times the rate that miners are producing it. According to Charles Edwards, founder of Capriole Investments, such a gap has historically preceded significant price gains.
In a post on May 4, Edwards said that every past instance of this demand-to-supply imbalance delivered an average return of about 24% over the following month. From current prices, that percentage would imply a BTC level near $96,000.
What the Data Shows
The 500% figure comes from tracking daily institutional purchases—primarily from public companies and ETFs—against the roughly 450 BTC mined each day since the 2024 halving.
“Every time it’s been this high before, price has shot up over the next week,” Edwards wrote. “The average return in prior cases is +24% over 1 month from here, that would take it to around $96K.”
Earlier today, Bitcoin topped $80,000 for the first time since January. Over the past 24 hours it traded between roughly $78,000 and $80,500, according to CoinGecko, and it has climbed about 20% over the last 30 days.
The surge triggered a wave of forced liquidations, wiping out more than $162 million in short positions within 24 hours, according to CoinGlass data.
Trading volume also spiked, rising about 95% in a day to approximately $34 billion.
Other analysts have offered support for a bullish outlook, although their confidence levels vary. Trader Taiki Maeda said he expects Strategy to buy $2–3 billion worth of Bitcoin over the next two weeks via its STRC instrument, with purchases likely to “accelerate into May 14th.”
Chartist Ali Martinez highlighted a multi-decade ascending trendline from which BTC has bounced in 2017, 2018, 2020, and 2022. He suggested that the recent dip to $65,000 may indicate the bottom is in.
The Other Side of the Coin
Bitcoin’s move above $80,000 follows a 12% gain last month, but CryptoQuant cautioned that the rise was driven almost entirely by interest in perpetual futures rather than spot buying.
According to the firm, Bitcoin’s on-chain spot demand indicator—which tracks 30-day on-chain spot activity—remained negative throughout April’s rally.
“The divergence between rising price and contracting spot demand is one of the clearest on-chain signals that price gains are speculative rather than structural,” CryptoQuant wrote, noting that this demand pattern resembles the one observed at the start of the 2022 bear market.