Bitcoin's recent surge is different, and the reason is significant: individual traders are essentially absent.

Data from consumer-focused apps like PayPal and Coinbase, along with insights from CryptoQuant, show that small investor activity is inactive.

Retail investors are the latecomers in the cryptocurrency cycle.

Historically, retail investors have always been late to the rise and fall cycles of Bitcoin. Market observers say this lack of participation indicates that the current rebound is still in its early stages. Noelle Acheson wrote in her newsletter 'Crypto is Macro Now' that Bitcoin is approaching previous historical highs of over $73,000, but personal interest measured by internet search trends and app downloads remains very low.

"Retail investors are generally 'late adopters', driven by price news and social attention," Acheson said. "When retail investors start to 'rush in', we know that the peak of the hype is near."

Switching to Memecoin

While individual traders are not driving the current surge in Bitcoin, they have not been completely marginalized. The growing appeal of meme coins has also caught the attention of small investors, currently valued at $61 billion in the industry. According to data, retail trading volume for meme coins is expected to grow fivefold year-on-year by 2024. This growth can be attributed to new tools like pump.fun, which simplify the process of creating cryptocurrencies and allow new tokens to emerge quickly.

The institutional dominance of Bitcoin.

Institutional investors have been the main driving force behind Bitcoin's current surge, especially through spot Bitcoin exchange-traded funds (ETFs). Since the launch of Bitcoin ETFs, these large fund investors have poured about $24 billion into them, accounting for about two-thirds of all inflows. However, this institutional enthusiasm has not spread to most altcoins, which remain heavily influenced by retail investors.

Data from cryptocurrency data tracking company Kaiko shows that as large altcoins are unlocked, liquidity is concentrated in fewer tokens, posing challenges for small investors. Additionally, Bitcoin has decoupled from the broader cryptocurrency market in this cycle, meaning that most altcoins have failed to match Bitcoin's price performance, with only a few exceptions, including Solana, Dogecoin, BNB, and Tron.

As a result, a significant shift has occurred in the altcoin world: meme coins now account for nearly one-third of the top 50 altcoins by market cap, up from 7% last year.