Short-Term Bitcoin Holders Are Fleeing: Here’s What It Means for the Market
Wallets belonging to short-term Bitcoin holders have experienced a dramatic drop since late May, according to data from on-chain analytics company CryptoQuant. This investor group’s holdings of Bitcoin have decreased from 5.3 million on May 27 to just under 4.5 million as of June 19.
In less than a month, the figures show a drop of 800,000 BTC or about 15.1%. Investors who purchased Bitcoin in the last few weeks or months are known as short-term holders (STH). This group typically grows during bull market cycles as newcomers purchase Bitcoin from long-time holders, hence boosting price growth.
BTC Demand Momentum Falls to Record Lows
According to CryptoQuant, this is a component of a broader decline in interest. The demand momentum has dropped by 2 million Bitcoin, which is the lowest amount ever seen. Spot buying is still occurring, but it’s happening much more slowly. The demand for Bitcoin dropped from 228,000 BTC at the end of May to just 118,000 BTC during the last 30 days.
Retail behavior isn’t the only thing declining; institutional demand is also beginning to decrease. A few weeks ago, whales’ monthly accumulation rate was 3.9%, but now it is only 1.7%. Furthermore, the U.S. Bitcoin ETFs‘ daily purchases have decreased from 9,700 BTC in April to roughly 3,300 BTC at this time.
Retail Caution Grows, But Institutions Are on a BTC Buying Frenzy
Additionally, futures market traders are becoming more cautious. When Bitcoin hit $110,000 last week, many people sold off their holdings in order to benefit. As the asset’s price declines toward $105K, more traders are placing short bets and betting against it. Major institutional players have not slowed down their Bitcoin accumulation despite the trend.
- BlackRock had a six-day purchasing streak earlier this week, boosting its Bitcoin holdings to $1.4 billion.
- The biggest corporate Bitcoin owner, Strategy, recently spent around $1.05 billion and added 10,100 BTC to its balance sheet.
- MetaPlanet, based in Japan, has also been purchasing Bitcoin consistently and recently hit the 10,000 BTC milestone.
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