Following Bitcoin's impressive price rise over the past few weeks, investors and traders have turned their attention to Bitcoin, solidifying its position as the leading digital asset in the crypto market. However, this strong optimism is mainly found among short-term BTC investors, according to the report.
Bullish sentiment moves towards short-term Bitcoin holders
In a sudden turn of events, short-term Bitcoin holders and retail investors are showing more confidence in the crypto asset than long-term holders, according to a report from Alpharactal, a leading on-chain data and investment platform. This change in market dynamics suggests that retail investors are starting to trust in BTC's resilience.
While long-term holders have shown less interest in Bitcoin, the platform highlighted that short-term holders have been continuously accumulating BTC throughout the previous rally. Despite the recent market volatility, short-term holders appear to be clinging to their positions, reflecting a strong belief in BTC's short-term potential.
It is important to note that long-term holders typically distribute their coins during bull cycles and send them to crypto exchanges. Retail holders, on the other hand, contribute more to short-term demand and therefore have more influence on price trends. Essentially, they accumulate more BTC and the price usually reacts favorably.
Short-term holders will continue to accumulate BTC | Source: Alfa Ractal on X
As retail holders continue to collect more coins, Alphactal noted that the focus is on BTC holders of up to one month. This is because significant BTC accumulation by Investor Profiles has historically signaled local market highs and frequently signaled market euphoria, creating room for price corrections at any time.
The platform further noted that while it may be impossible to determine exactly when this will happen, recent data reveals that this group of investors is steadily growing. Nevertheless, this level is still significantly lower than the levels recorded during the 2017 and 2021 bull markets, indicating that these new investors still have a chance to acquire more Bitcoin. This means that Bitcoin price could be pushed towards higher levels in the coming weeks.
BTC retail investor demand surges to new levels
Demand from retail investors is currently at levels not seen in recent years. According to data from CryptoQuant, a leading on-chain and data provider, the 30-day demand change from these investors has reached its highest level since 2020, indicating local top potential. A surge in retail interest could partially explain the persistent demand, even as long-term holders have begun unwinding their positions to lock in profits.
While this development may hint at a local top, it also highlights rising market engagement, which, combined with institutional investor interest, could generate positive momentum. However, over time, retail demand may start to decline as BTC moves into a sideways phase.
BTC trading at $98,547 on 1D chart | Source: BTCUSDT on Tradingview.com
Featured image from Unsplash, chart from Tradingview.com
