Is Bitcoin Going to Surge in July?

A handful of powerful forces and an often-jittery macroeconomic backdrop are suddenly all starting to push in the same direction

The convergence could juice prices in July, yet the bigger payoff is what those forces say Bitcoin's next decade

Let's dive in and explore how the near term connects to the bigger picture here

Why July's tailwinds line up so neatly Imagine a giant vacuum cleaner running on autopilot

That is essentially how spot Bitcoin exchange-traded funds (ETFs) work

Whenever investors hand cash to asset issuers, the funds must buy the coins and warehouse them, with no selling

Many investors missed the headlines, yet the buying keeps grinding onward because asset managers are obligated to do it to back their ETFs

Mechanical demand is meeting a constrained supply, which is a bullish recipe whenever the float available for public trading is limited or thin

Corporate treasurers are now acting nearly as mechanically when it comes to accumulating Bitcoin

Image source: Getty Images

Even if this plan is incredibly ambitious and might not become a reality, it indicates that at least some buyers with deep pockets are eager to grab as much of the coin as they can manage, even if it means borrowing money to do so

And with each purchase, more coins leave circulation

Policymakers are, surprisingly, helping this cess along

A March 6 executive order mandated the creation of an as-yet unimplemented U

Strategic Bitcoin Reserve, instructing federal agencies to retain rather than sell any coins forfeited in the future

Implementation rules were supposed to be drafted within 70 days of the order, so the final guidelines could land by late July

If the government s through and becomes a net holder instead of a seller, the supply pressure facing Bitcoin tightens even further, and perhaps permanently

Combine that with bullish development with the difficult-to-predict macro backdrop this summer

Capital is already rotating toward private sector stores of value rather than sovereign debt as tariff threats and currency angst resurface

Demand for safe assets rarely arrives in tidy monthly bundles, but July's news flow could be the spark that lights the fuse -- though it's important to recognize that Bitcoin's as a safe investment is still not ven

Nonetheless, taken together, these forces create an unusually narrative for Bitcoin

Forced buying, diminished float, policy support, and risk hedging are all converging

So July may not der a straight-line rally, but the chances of fireworks are better than usual

The long game is doing the heavy lifting Even if July pops, the real engine for this asset is time

The asset is thus quite scarce already

Corporate holders add another layer

None of this guarantees a painless ride in either July or the long term, of course

A global liquidity crunch could suck the wind out of the coin's sails

Or Congress might balk at the details of the Treasury's reserve plan, injecting uncertainty and bably denting prices

Mitigating against those risks and running the practical playbook is simple

Dollar-cost average, keep some dry powder for true panics or deep dips, and measure your investment's success over multiple halvings, not multiple weeks

If July fireworks appear, enjoy the show

If they fizzle, treat the cheaper coins as a gift

Alex Carchidi has positions in Bitcoin

The Motley Fool has positions in and recommends Bitcoin

The Motley Fool has a disclosure policy.