Bitcoin Demand Dips While Large Investors Begin Reaccumulation: CryptoQuant Analysis

Since the United States presidential inauguration, the overall growth in bitcoin spot demand has slowed significantly. For BTC’s price to rally again, an increase in spot demand growth is necessary; however, this metric has yet to recover. A CryptoQuant report indicates that despite the lack of such an increase, major BTC investors are in a reaccumulation phase, actively adding to their holdings.

**Bitcoin Demand Growth is Slow**

Although spot demand growth remains sluggish, bitcoin’s apparent demand continues to expand, albeit at a reduced pace. The rate of expansion has decreased from 279,000 BTC in early December 2024 to 75,000 BTC currently. Additionally, the growth in demand momentum has dropped from 1.7 million to 0.1 million between early December and the present. For bitcoin’s price to rally significantly, there needs to be an uptick in this growth metric.

Notably, bitcoin demand growth from large investors surged between January 14 and 17, ahead of U.S. President Donald Trump’s inauguration. CryptoQuant found that the monthly percentage increase in large investors’ BTC holdings rose from -0.25% to +2% during this period, marking the highest monthly rate since mid-December. On-chain data reveals that large investors have been key drivers of bitcoin demand and price since the U.S. presidential election, increasing their holdings while smaller investors have been reducing theirs. From November 4 to January 24, large investors’ total holdings grew from 16.2 million BTC to 16.4 million, while small investors’ holdings decreased from 1.75 million to 1.69 million BTC.

**Large Investors Drive BTC Price**

As large investors drive bitcoin demand and price, the sell pressure has decreased significantly, particularly after other holders sold assets to realize profits during the December rally. Analysts noted that realized daily profits reached $10 billion when BTC was around $100,000 in December. Currently, daily realized profits have fallen to between $2 billion and $3 billion, indicating that traders have largely concluded their selling. This trend is also evident in the decline of traders’ unrealized profit margins to levels that often indicate a price floor.

CryptoQuant stated, “The Traders’ On-chain Realized Profit Margin declined almost to zero in mid-January, after reaching overheated levels near 60% in November-December as Bitcoin rallied towards $100K. A low realized profit margin for traders indicates fewer profits to be made by selling and hence lower selling pressure for Bitcoin.”

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