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Bitcoin is trading well below its 2025 all-time high of $125,000, yet two new reports suggest its supply picture is tightening faster than most investors realize. According to Binance Research’s April 6 Market Watch, the widely cited 21 million hard cap significantly understates Bitcoin’s real scarcity.
Of the roughly 19.5 million BTC mined to date, 3.47 million, or 17.4% of total supply, have not moved in over a decade. That dormant share has grown steadily, surviving multiple bull and bear cycles without meaningful spending. Binance Research concludes these coins are not simply being held. They are effectively gone.
Of the roughly 19.5 million BTC mined as of early April 2026, 3.47 million, equal to 17.4% of total supply, have not moved in over a decade. That share has grown from just 10% in early 2021. These coins survived the $69K bull run, the $16K crash, the 2024 ETF inflows, and the 2025 all-time high at $125K without any meaningful spending. They are effectively gone.
BREAKING: Binance Research says Bitcoin is already deflationary, with −0.21% net inflation.
Around 164K BTC is issued each year, while 290K BTC goes dormant, shrinking the available supply. pic.twitter.com/AhnYzqTElP
— Bitcoin Archive (@BitcoinArchive) April 6, 2026
The impact on active supply is substantial. While nominal issuance sits at around 164K BTC per year after the halving, roughly 290K BTC crossed the 10-year dormancy threshold in Q1 2026 alone.
For context, that single-quarter loss of old coins is nearly double the entire annual new supply added in 2020 after that year’s halving, when issuance was around 328,500 BTC per year.
As a result, adjusted circulating supply has flatlined and, in several recent periods, actually contracted.
Bitcoin Hashrate: US (37.4%), Russia (16.9%), and China (12.0%) Rank Top Three
According to Hashrate Index report, global hashrate declined to 1,004 EH/s (Q2 2026) from 1,066 EH/s (Q1 2026). Bitcoin hashrate remains highly concentrated, with the US (37.4%), Russia (16.9%), and… pic.twitter.com/bw4O4LSRhE
— Wu Blockchain (@WuBlockchain) April 6, 2026
On a net basis, Binance Research calculates Bitcoin’s effective annual inflation rate at -0.21%, making the asset deflationary in practice.
The production side of Bitcoin’s supply picture tells an equally important story. Global hashrate fell to a 30-day moving average of 1,004 EH/s in Q2 2026, down 5.8% from the previous quarter. The drop was driven by Bitcoin’s price falling roughly 50% from its October 2025 peak. That event pushed hashprice to a record low of $27.89 per PH/s/day and forced older mining equipment offline.
The geographic concentration remains heavy:
CoinShares’ Q1 2026 report confirms the same three-country dominance, with China’s share declining further after renewed enforcement in Xinjiang.
Emerging markets are steadily gaining ground. Paraguay now controls 4.3% (43 EH/s), while the UAE and Oman each hold 3%. Ethiopia has climbed to 2.5%, backed by cheap hydroelectric power. Kyrgyzstan, Laos, and Finland also posted year-over-year growth despite the overall hashrate contraction.
Miners are also adapting to the low hashprice environment. Many operations have begun selling large portions of their BTC holdings to stay afloat and are increasingly pivoting toward AI and high-performance computing to utilize their energy infrastructure more profitably.
Both reports paint a clear but complex picture. On one hand, Bitcoin’s effective supply is already deflationary. Lost and dormant coins are removing more BTC from circulation than new issuance adds. That is structurally bullish for price over the long term.
🔥 The top three #countries (US, China, Russia) control ~68% of global #Bitcoin $BTC hashrate pic.twitter.com/JQwv0nTGd6
— CoinGape (@CoinGapeMedia) April 2, 2026
On the other hand, the network producing that scarce supply is heavily concentrated. The United States, Russia, and China control nearly 67% of global hashrate.
Dennis Porter of the Satoshi Action Fund put the hardware risk bluntly: “America controls 38% of the world’s hashrate, but 97% of the mining hardware comes from China. That is not leadership, that is a liability.” Chinese firms Bitmain, MicroBT, and Canaan still produce roughly 99% of all ASICs.
America controls 38% of global Bitcoin hashrate, but 97% of the hardware is built by two Chinese firms: Bitmain and MicroBT.
The Mined in America Act from @SenBillCassidy & @SenLummis creates a voluntary program by giving miners benefits if they transition to allied hardware. https://t.co/t9BIEgm1a6 pic.twitter.com/nLwnZwJQVt
— Satoshi Action Fund (@SatoshiActFund) April 1, 2026
Hashrate Index notes that while geopolitical shocks can cause localized disruption, no single country holds enough power to threaten the network’s overall continuity. Hashrate simply shifts when one region faces pressure.
As Bitcoin’s available supply tightens and mining power consolidates, the network is entering a new phase where scarcity and infrastructure concentration evolve simultaneously, a dynamic that could shape both price behavior and geopolitical relevance in the next cycle.
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