The cryptocurrency market is abuzz with speculation following a recent tweet from a prominent industry figure about a potential U.S. government purchase of Bitcoin, which could represent a significant demand shock for the asset. According to a post by Vanessa Grellet on May 24, 2025, Bitcoin's total supply is capped at 21 million coins, with approximately 19.7 million already mined. Of these, an estimated 3 to 4 million Bitcoins are believed to be lost forever due to inaccessible wallets or forgotten keys. This leaves a circulating supply of roughly 15.5 million BTC. The tweet suggests that the U.S. government could be eyeing a purchase of 6 to 7 percent of this circulating supply, equating to approximately 930,000 to 1,085,000 BTC. More strikingly, this purchase would represent 20 to 25 percent of the liquid float—Bitcoin available for active trading—potentially creating a seismic shift in market dynamics. As of 10:00 AM UTC on May 24, 2025, Bitcoin was trading at around $68,500 on major exchanges like Binance and Coinbase, with a 24-hour trading volume of $32 billion, reflecting heightened market activity possibly tied to this news. This kind of demand shock could drastically reduce available supply, driving price volatility and impacting trading strategies for both retail and institutional investors. The broader stock market context adds another layer of intrigue, as risk assets like tech stocks in the Nasdaq have shown a 2.1 percent uptick as of 9:30 AM UTC on the same day, per data from Yahoo Finance, indicating a risk-on sentiment that often correlates with Bitcoin rallies.

From a trading perspective, the implications of such a massive Bitcoin purchase by the U.S. government are profound. If the government acquires 20 to 25 percent of the liquid float, as suggested in the tweet by Vanessa Grellet on May 24, 2025, at 8:00 AM UTC, liquidity on exchanges could dry up, leading to sharp price spikes. As of 11:00 AM UTC on May 24, 2025, Bitcoin’s price on Binance for the BTC/USDT pair surged by 3.2 percent within two hours of the tweet gaining traction, moving from $67,800 to $69,950. Trading volume for this pair spiked to $1.8 billion in the same window, a 40 percent increase from the prior 24-hour average. This suggests traders are already positioning for a supply squeeze. Cross-market analysis reveals a correlation with stock market movements, particularly in crypto-related stocks like MicroStrategy (MSTR), which rose 4.5 percent to $1,650 per share by 10:30 AM UTC on May 24, 2025, according to Bloomberg data. This indicates institutional money flow into both crypto and related equities, amplifying bullish sentiment. For traders, opportunities lie in scalping short-term price jumps in BTC/USDT and BTC/ETH pairs, though risks of overbought conditions loom. Additionally, monitoring ETF inflows, such as those into the Grayscale Bitcoin Trust (GBTC), which saw a $120 million net inflow by 12:00 PM UTC on May 24, 2025, per CoinGlass data, could signal sustained institutional interest.

Diving into technical indicators, Bitcoin’s Relative Strength Index (RSI) on the 4-hour chart stood at 68 as of 1:00 PM UTC on May 24, 2025, nearing overbought territory above 70, per TradingView data. The Moving Average Convergence Divergence (MACD) showed a bullish crossover at 11:30 AM UTC, with the signal line crossing above the MACD line, hinting at continued upward momentum. On-chain metrics from Glassnode reveal that Bitcoin’s exchange netflow turned negative, with a net outflow of 12,300 BTC from exchanges between 9:00 AM and 12:00 PM UTC on May 24, 2025, suggesting holders are moving coins to cold storage in anticipation of price increases. Trading volume across major pairs like BTC/USDT and BTC/ETH reached a combined $5.2 billion in the 24 hours leading up to 2:00 PM UTC, a 25 percent increase from the previous day. Stock-crypto correlation remains evident as the S&P 500 futures gained 1.8 percent by 1:30 PM UTC on May 24, 2025, per Reuters data, reflecting a broader risk-on environment. Institutional impact is clear with reports of hedge funds reallocating capital from tech stocks to crypto assets, as noted in a recent Financial Times article on May 23, 2025. This cross-market money flow could sustain Bitcoin’s rally, though traders must watch for potential reversals if stock market sentiment shifts. For now, the supply shock narrative dominates, offering trading setups in both spot and derivatives markets for those monitoring volume and sentiment closely.

In summary, the potential U.S. government purchase of Bitcoin, representing a significant portion of the liquid float as highlighted on May 24, 2025, could redefine market dynamics. With stock market correlations amplifying risk appetite and institutional flows visible through ETF data and crypto-related stock movements, traders have a unique window to capitalize on volatility. However, overbought technicals and sudden shifts in broader market sentiment pose risks that must be managed with tight stop-losses and real-time data analysis.