How Bitcoin (CRYPTO: BTC) retreated from recent highs, some market voices blamed outdated narratives such as four-year cycles or technical anomalies. Others argue that the problem is much deeper.

Veteran technical analyst Bob Kendall said that Bitcoin is no longer priced because of chain scarcity or the fixed supply of 21 million.

Once financial layers were added, including futures, perpetuities, options, ETFs, loan products, wrapped BTC, and swaps, Bitcoin effectively lost scarcity at the point of price discovery. Supply can now be created synthetically, making BTC trading more like gold or oil in heavy derivatives markets.

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As a result, Kendall said the price is driven by the marginal buyer and the synthetic float, not the physical Bitcoin. Big players can create “paper BTC”, short rallies, trigger liquidations, cover at lower prices and repeat the process.

“A real BTC can support multiple claims,” ​​he noted, making Bitcoin a fractional-reserve-style market rather than a pure supply-and-demand asset.

Kendall argued that Bitcoin’s current problems were not caused by ignorance but by greed. According to him, many prominent Bitcoin influencers and advocates chased legitimacy, Wall Street approval, ETFs, media exposure and faster price appreciation.

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In doing so, they willingly integrated Bitcoin into the traditional financial system, believing it would make them rich. The warning, Kendall said, was clear years in advance: Inviting Wall Street to discover prices would destroy scarcity and transform Bitcoin into a leveraged financial product.

He added that government involvement and regulation only accelerated change, allowing for greater control, taxation and surveillance rather than preserving Bitcoin’s original principles.

Wall Street didn’t hijack Bitcoin, Kendall said, it was invited.

Image: Shutterstock

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This article Bitcoin’s ‘infinite’ paper supply, not Wall Street, is the real problem, analyst says originally appeared Benzinga.com