The decreasing growth rate of Bitcoin whale assets is seen as a bearish signal for the cryptocurrency’s price, according to a report by on-chain data provider CryptoQuant.
CryptoQuant Highlights Declining Bitcoin Whale Assets as Bearish Indicator
CryptoQuant noted in its weekly report that the 30-day percentage change in Bitcoin whale holdings has decreased significantly, from 6% in February to just 1% currently.
The report suggests that this decrease in savings by large-scale asset owners, which is seen as a significant factor in the rise in Bitcoin's price, is a sign of a decline in market conditions.
“Historically, a monthly growth rate of over 3% in whale assets has been associated with rising Bitcoin prices, which we are not currently seeing,” CryptoQuant analysts wrote. The waning interest from whales could mean that the digital asset’s bullish momentum is waning.
The report also highlighted a broader decline in Bitcoin demand, as measured by CryptoQuant’s “apparent demand” metric, which tracks the difference between the daily Bitcoin block subsidy and the daily change in the amount of Bitcoin that has not moved for more than a year.
“Apparent Bitcoin demand has slowed significantly since April, when Bitcoin was trading at $70,000. The 30-day demand growth that peaked at 496,000 BTC in January 2024 has now turned negative, showing a decline of 25,000 BTC,” it said.
Another key finding in the report is the declining price premium for Bitcoin on Coinbase, a popular U.S.-based exchange. By early 2024, this premium had reached 0.25%, reflecting strong demand fueled by exchange-traded fund (ETF) purchases and investor interest.
However, the premium has steadily fallen to just 0.01%, signaling weakening demand for Bitcoin in the US market.
As whale assets and overall demand for Bitcoin decline, CryptoQuant analysts suggest that these trends could continue to put downward pressure on Bitcoin prices unless there is a significant change in market dynamics.
*This is not investment advice.
