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Why Bitcoin Isn’t Experiencing an Explosive Surge? Analytics Company Reveals the Real Reason

Why Bitcoin Isn’t Experiencing an Explosive Surge? Analytics Company Reveals the Real Reason

BitcoinsistemiBitcoinsistemi2024/09/20 09:36
By:Mete Demiralp

Why doesn't the Bitcoin price show sudden increases like before? The analysis company shared the report containing its thoughts.

CryptoQuant, a leading market research firm, has detected a significant drop in the supply of short-term holders (STH) of Bitcoin (BTC), which it notes could pose an obstacle to the cryptocurrency’s price boom.

According to the company, the 30-day change in Bitcoin's STH supply has reached its lowest levels since 2012, indicating a major shift in market dynamics.

Bitcoin supply is increasingly shifting toward long-term holders (LTH), investors who typically accumulate Bitcoin and hold it for 155 days or longer. While this shift signals confidence in Bitcoin’s long-term value, the lack of activity from short-term holders may be suppressing the asset’s price momentum.

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“Historically, Bitcoin has been rising to new highs as a result of new holders buying from long-term holders and driving up the price in the process,” said Julio Moreno, Director of Research at CryptoQuant. He explained that while the accumulation of LTHs is usually a prerequisite for future price appreciation, fresh demand from short-term holders is necessary to trigger a sustainable rally.

According to Moreno, “Bitcoin needs fresh demand from short-term holders to sustain a price rally. This is what happens during bull cycles.”

*This is not investment advice.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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