The demand for Bitcoin among retail investors has hit a five-month low, dropping to levels last seen in January. This decline of around 17% in demand over the past month has been noted by CryptoQuant author Axel Adler, who pointed out that a similar drop in January led to a 75% surge in Bitcoin’s price over the following two months.
Retail investors, defined as those with up to $10,000 in transfer volume, are known to react quickly to market changes. In May, Adler had observed a 31% drop in demand in just 17 days, possibly due to increased interest in GameStop and Ether.
Analysts attribute the shift in Bitcoin demand to various factors, including the U.S. Consumer Price Index (CPI). A decrease in the CPI can make assets like Bitcoin more appealing to investors, especially as traditional savings offer less attractive returns.
For Bitcoin to reach new all-time highs, the CPI must drop to 3.3% by June 12. However, as of now, Bitcoin is trading at $67,350, down 3.19% over the past 24 hours. The recent drop below $69,000 has caused concern among traders, with $52.87 million worth of Bitcoin long positions being wiped out.
Despite hopes for a quick recovery above $70,000, future traders are not anticipating this in the near term. With $2.14 billion in short positions at stake, the market remains uncertain.
It is important to note that this article does not provide investment advice. All investment decisions should be carefully researched and considered by the individual investor.