As an analyst with over two decades of experience in financial markets and a keen interest in cryptocurrencies, I find myself intrigued by the current state of Bitcoin retail investor activity. The slow pace at which they are accumulating Bitcoins, according to CryptoQuant’s report, is indeed concerning, but it might not be all doom and gloom.
After a downtrend at the start of October, Bitcoin has recently changed direction and climbed as high as $69,000 over the past fortnight. This substantial price surge hasn’t encouraged many retail investors to jump into the market, though. In their weekly crypto analysis published on Friday, blockchain analytics company CryptoQuant offered an intriguing perspective on the low activity among retail traders in the Bitcoin market.
Bitcoin Retail Investors’ Holding Grows At Historically Slow Pace – Report
Over the past four months, as per CryptoQuant’s data, retail investors have accumulated approximately 18,000 Bitcoin with a market value of around $1.2 billion. This has brought their total Bitcoin holdings up to about 1.753 million BTC, which is currently worth an impressive $112.7 billion.
While this development demonstrates a rising market interest by these small investors, the analytic firm notes the pace of accumulation is significantly slow compared to historical data as retail investors only acquired a net 1,000 BTC valued at $66.31 million, in the last 30 days. Notably, the retail investor accumulation rate has been on a consistent decline since May 2023, when their holdings rose by 27,000 BTC worth $1.79 billion
Consequently, according to CryptoQuant, individual Bitcoin investors boosted their investments by approximately 30,000 BTC, equivalent to $1.99 billion, during 2024. However, this is insignificant compared to the growth seen among whale investors, whose holdings swelled by a massive 173,000 BTC worth an impressive $11.50 billion over the same timeframe.
When prices are rising, a decrease in retail investor participation might raise concerns because it could signal reduced market fluidity or even a loss of faith among investors regarding the asset’s capacity to maintain its upward trend.
Small-scale investors not showing interest could be a good sign as well. For instance, CryptoQuant reveals that when these investors hold onto their Bitcoin instead of trading it, this means lower trading activity. The analytics firm points out that the number of Bitcoins transferred to exchanges in January 2023 dropped from an average of 2,700 BTC per day to 1,400 BTC in 2024, suggesting less pressure to sell the token.
Moreover, it’s worth noting that the amount of trading among individual investors in the cryptocurrency market is relatively minimal, with transaction volume reaching only $326 million on September 21 – a figure not seen since 2020. This decrease in trading activity might suggest a calm market, but CryptoQuant points out that such low retail involvement often precedes substantial price increases for Bitcoin.
Bitcoin Price Overview
Currently, Bitcoin is being traded at approximately 66,896 dollars. This drop comes from a 1.11% decrease in the past day, which was influenced by rumors of an investigation into Tether, the entity behind stablecoin USDT, and ongoing conflicts in the Middle East. Despite this decline, Bitcoin’s daily trading volume has significantly increased by 34.29%, reaching a value of around $42.10 billion.
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2024-10-26 23:46