The Declining Growth Rate of Bitcoin Whale Holdings

The declining monthly growth rate of bitcoin whale holdings is a bearish indicator for the digital asset’s price, according to on-chain data provider CryptoQuant.

CryptoQuant’s weekly report shows the 30-day percentage change in whale holdings has decreased from 6% in February to a current growth rate of just 1%.

The report stated that the decreased appetite of large-scale bitcoin holders is a bearish market indicator. “Historically, a monthly growth rate of more than 3% in whale holdings has been associated with increasing bitcoin prices, which is not the case at the moment,” CryptoQuant analysts noted.

Overall Bitcoin Demand Dips into Negative Territory

The report focuses on one of CryptoQuant’s metrics called apparent demand. It’s the difference between the daily total bitcoin block subsidy and the daily change in the number of bitcoin that have not moved in over a year.

“Overall bitcoin apparent demand has slowed considerably since early April when the digital asset was trading at $70,000. Demand has declined from a 30-day growth of 496,000 bitcoins, the highest since January 2021, to a current negative growth of 25,000 bitcoins,” the report mentioned.

CryptoQuant analysts indicated that as demand slowed, bitcoin prices dropped from around $70,000 in early June to a low of $49,000 on August 5. “We would need to see apparent demand expanding again for prices to recover,” the analysts added.

The CryptoQuant report also noted that the decline in demand is evident in a lower price premium for bitcoin on Coinbase.

“Early in 2024, the price premium for bitcoin trading on Coinbase reached 0.25%, coinciding with strong demand for bitcoin, as shown in previous charts, and larger purchases from exchange-traded funds. However, the premium has been trending downward since then, currently standing at 0.01%, indicating that bitcoin demand in the U.S. has been weakening,” the CryptoQuant analysts concluded.