Recent on-chain data indicates that retail investor interest in Bitcoin remains low, even with the cryptocurrency reaching new heights.
Historically Low Retail Demand for Bitcoin Over 30 Days
According to a CryptoQuant analysis, the latest metrics for Bitcoin Retail Investor Demand reveal a significant dip in the past 30 days, showcasing the purchasing activity among smaller investors.
Retail investors represent the smallest asset holders within the Bitcoin network, typically conducting smaller transactions. Hence, the measure focuses on transaction volumes of amounts under $10,000 to track their engagement.
The following chart illustrates the trend in the monthly change in Bitcoin Retail Investor Demand over recent years.
The chart indicates a significant rise in retail demand during last year’s bull market, when Bitcoin prices surged past $100,000.
This surge suggested a notable increase in activity from these smaller holders, who typically engage more during price increases due to the excitement they generate.
However, the scale of this increase was unprecedented, exceeding previous highs in recent years. The analysis suggests that this peak in retail demand coincided with Bitcoin’s price peak.
Historically, large fluctuations in retail demand often align with market tops, suggesting that excessive Fear Of Missing Out (FOMO) among retail investors could be detrimental to price increases.
Since last year’s peak, the Bitcoin Retail Investor Demand has experienced a drastic decline, now sitting at a historical low of -22% for its 30-day change.
Notably, this downward trend persists despite Bitcoin’s recent rally to a new all-time high. This indicates that retail investors have not yet returned en masse to the market.
Based on historical trends where FOMO negatively impacts market rallies, the current lack of enthusiasm from retail investors might allow the Bitcoin price to sustain its upward momentum for a while.
Current BTC Price
As of now, Bitcoin is priced at approximately $106,400, reflecting a rise of over 15% in the past week.
