Bitcoin’s demand among retail investors has reached its lowest point in five months, dropping to levels last seen in January. During that time, there was a significant surge of 75% over the following two months. Data shared by CryptoQuant author Axel Adler on June 10 shows that the average monthly change in demand for Bitcoin among retail investors, those with up to $10,000 in transfer volume, has fallen to negative 17% in the last 30 days.
Adler noted that a similar drop to -18% in January led to Bitcoin’s price increase from $40,000 to $70,000. This surge occurred after the approval of spot Bitcoin exchange-traded funds (ETFs) in the United States, pushing Bitcoin to its all-time high of $73,679 in mid-March.
“I also observed that this group reacts swiftly to market changes,” said Adler.
In the previous month, Adler used the same measure to demonstrate that demand had decreased by 31% in the 17 days leading up to May 24, dropping to negative 14.50%. He attributed this shift to increased interest in GameStop (GME) and Ether (ETH), possibly due to the initial approval of spot Ether ETFs.
Analysts have suggested that the decline in Bitcoin demand is influenced by various factors, including the U.S. Consumer Price Index (CPI). When the CPI decreases, assets like Bitcoin become more attractive to investors as traditional savings and deposits offer lower returns due to dropping interest rates.
Markus Thielen, head researcher at 10x Research, told Cointelegraph in May that Bitcoin’s price must drop to 3.3% on June 12, the date when the Bureau of Labor Statistics (BLS) will release the data, in order for Bitcoin to reach new all-time highs.
On June 11, Bitcoin fell below $69,000, its all-time high from November 2021, a level closely monitored by traders. Currently, Bitcoin is trading at $67,350, down 3.19% over the past 24 hours according to CoinMarketCap.
The sudden decline caused $52.87 million worth of Bitcoin long positions to be wiped out in the last day. Despite hopes for a quick rebound above $70,000 after dropping below that level on June 8, Bitcoin has yet to do so. Future traders do not appear to anticipate its recovery in the near term, with $2.14 billion in short positions at stake if it does bounce back.
This article does not provide investment advice or recommendations. Every investment and trading decision carries risk, and readers should conduct their own research before making any decisions.