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CryptoQuant Says Bitcoin Demand is ‘Eating’ Available Inventory, Here’s How
Bitcoin’s apparent demand growth is rising by the highest monthly rate this year, while sell-side liquidity has fallen to levels not seen since 2020.
As we enter the midpoint of this bull cycle, it appears that the amount of bitcoin available for sale is dwindling at a pace faster than ever before relative to demand growth. On-chain analysis conducted by market intelligence firm CryptoQuant reveals that the cryptocurrency market is currently experiencing a demand shock due to the acceleration of both supply and demand.
According to a weekly report from CryptoQuant, bitcoin’s apparent demand has been expanding since late September at a monthly rate of 228,000 BTC, while the total amount of BTC readily available for sale across crypto exchanges, over-the-counter desks, miners, and the Grayscale Bitcoin Trust (GBTC) has decreased to levels unseen since October 2020.
The balance of BTC accumulator addresses, referring to investors who purchase BTC and have never sold any, is expanding monthly at a record-high rate of 495,000 BTC. This growth in demand has resulted in inventory levels at OTC desks declining by the largest monthly volume in 2024 for the first time since April 25.
As Bitcoin demand rises sharply, so does liquidity in the industry. The total market capitalization of USD-based stablecoins recently surpassed $200 billion for the first time, marking a 20% or $35 billion increase from late October. This influx of fresh money into the crypto space coincided with BTC rallying above $100,000 to $108,000 at the time of writing.
At present, bitcoin sell-side liquidity stands at approximately 3.397 million BTC, an eight-year low since mid-2020. The rate has shrunk by a staggering 678,000 BTC so far this year alone, leading to significantly reduced selling pressure.
Source: cryptopotato.com
