On-chain analytics firm CryptoQuant has explained why the Bitcoin (BTC) price is struggling to rise. The main reason for this could be a lack of fresh demand in the market.
According to CryptoQuant data, the change in Bitcoin’s 30-day short-term holder (STH) supply has fallen to levels not seen since 2012.
The supply is shifting to long-term holders (LTH) who have held Bitcoin for 155 days or more. However, a lack of fresh demand from short-term holders may be preventing Bitcoin from breaking out of its current price range.
“Historically, Bitcoin reaches new highs when new holders buy from long-term holders (BTC), pushing the price higher. While long-term holders accumulating Bitcoin is a prerequisite for price appreciation, the reality is that Bitcoin needs new demand from short-term holders to sustain its price rally. This is what happens during bull cycles,” said Julio Moreno, Director of Research at CryptoQuant.
CryptoQuant’s charts show a strong positive correlation between short-term holder activity and Bitcoin’s price. “There is currently no significant demand from short-term holders,” Moreno added.
Bitcoin’s dominance is greater than it has been since April 2021
Bitcoin's market cap now accounts for 54.9 percent of the total value of the cryptocurrency market, an unseen level since April 2021.
According to CryptoQuant, spot Bitcoin ETFs, which entered the market in the US in January 2024, have made BTC a more investable instrument and attracted institutional investors to the market. In contrast, altcoins are considered to be more risky.
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