On-chain data shows that Bitcoin retail volume has increased sharply recently as the cryptocurrency surges to a new high.
Bitcoin retail sales volume has increased by more than 15% in the past 30 days
As CryptoQuant author Axel Adler Jr explains in a new article mail For X, demand from retail investors has been on the rise recently. Retail investors usually point to the portion of the BTC user base that holds the smallest holdings.
One way to measure demand from these investors is through their transaction volume. Due to the small size of their holdings, these owners do not make very large transfers, so their size can only be determined by tracking transfer data, which amounts to less than $10,000.
Below is the chart shared by the analyst, which shows the trend in 30-day change in retail investor conversion volume over the past few years.
The value of the metric appears to have spiked in recent days | Source: @AxelAdlerJr on X
As shown in the chart, Bitcoin retail transfer volume saw a negative change for 30 days earlier, but has seen fluctuation with the recent rise in the asset’s price. The index has now risen to significant positive levels, indicating that interest from this group has increased sharply recently.
Retail investors being drawn to the network is not unusual during a volatile period like the one BTC has experienced recently, as these holders tend to find such times exciting.
The chart shows that this group showed a similar wave of demand during the first quarter of the year. Similar trends have also been observed on multiple occasions on the upside of 2021.
Historically, rallies that fail to attract retail interest usually end up not lasting very long, as investor influx tends to sustain such rallies. From this perspective, the current rally looks safe, as retail volume has increased by more than 15% over the past month.
Another indicator to measure Bitcoin-related demand is the Coinbase Premium Index. This metric tracks the difference between Bitcoin prices listed on Coinbase (USD) and Binance (USDT).
This indicator does not reflect demand from retail investors but from US institutional investors, who have a strong presence on Coinbase.
As CryptoQuant’s head of research, Julio Moreno Pointed at X mailThe Bitcoin Coinbase Premium Index recently rose into positive territory.
The trend in the BTC Coinbase Premium Index over the past week | Source: @jjcmoreno on X
A positive value of the indicator indicates that BTC is trading at a higher price on Coinbase compared to Binance, which in turn means that whales based in the US are showing demand for the cryptocurrency.
Bitcoin price
Bitcoin is looking to explore another high as its price rises back to the $75,900 level.
Looks like the price of the coin has seen a sharp increase recently | Source: BTCUSDT on TradingView
Featured image by Dall-E, CryptoQuant.com, chart from TradingView.com