Bitcoin’s market has recently shown signs of cooling demand, marking a significant shift from earlier bullish trends. According to CryptoQuant data since early April when Bitcoin reached nearly $70,000, demand has considerably slowed. This change is reflected in various indicators, such as Bitcoin’s apparent demand and the activity of major market participants.
Bitcoin’s apparent demand has turned negative in recent weeks. Previously, in early April, the 30-day growth rate of Bitcoin demand was around 496,000 BTC, the highest level since January 2021. However, this figure has since dropped to a negative growth of 25,000 BTC. Consequently, Bitcoin’s price has declined from approximately $70,000 to a low of $49,000. For a price recovery to occur, we need to see a rebound in demand.
A noticeable decline is also seen in the holdings of Bitcoin whales. The growth rate of total holdings by large investors has decreased sharply. From a robust 6% in February, the rate has dwindled to just 1% currently. Historically, a monthly increase in whale holdings above 3% has been associated with rising Bitcoin prices. This trend is absent now, suggesting a bearish outlook.
Moreover, Bitcoin spot ETF purchases in the U.S. have dropped significantly. In March, when Bitcoin was trading above $70,000, the average daily purchases by spot ETFs were around 12,500 BTC. Last week, this figure fell to just 1,300 BTC. A resurgence in spot ETF purchases could potentially help lift the overall Bitcoin demand and drive prices higher.
Bitcoin Near $59K as Bulls Struggle to Break $63K ResistanceOn the positive side, the permanent holders of Bitcoin continue to show strong interest. Despite the broader slowdown, these long-term investors are accumulating Bitcoin at unprecedented rates. Their total balance is increasing at a monthly rate of 391,000 BTC, which surpassed even the accumulation rates, last seen in early 2024.
Another noteworthy trend is the record-high market capitalization of stablecoins, which has reached $165 billion. An increasing stablecoin market cap often correlates with higher Bitcoin and overall cryptocurrency prices, suggesting potential future upward momentum.
At press time, Bitcoin is trading at $61,058.31 with a 24-hour trading volume of approximately $26 billion. It has seen a modest 0.33% increase over the last 24 hours.
