Bitcoin Demand Weakens but Large Investors Enter Reaccumulation: CryptoQuant

Since the United States presidential inauguration, overall bitcoin spot demand growth has slowed considerably. Spot demand growth is needed for BTC’s price to rally again; however, the metric has yet to make a comeback.

A CryptoQuant report revealed that despite the lack of such an increase, large BTC investors have entered a reaccumulation phase and are loading up on their bags.

Bitcoin Demand Growth is Slow

While spot demand growth is slow, bitcoin’s apparent demand has continued in expansion territory but at a slower pace. The rate of expansion has fallen from 279,000 BTC in early December 2024 to 75,000 BTC currently.

Additionally, the demand momentum increase has slumped from 1.7 million to 0.1 million between early December and now. Bitcoin needs to see an increase in this metric’s growth for its price to rally significantly.

Notably, bitcoin demand growth from large investors surged between January 14 and 17 ahead of U.S. President Donald Trump’s inauguration. CryptoQuant found that the monthly percentage rise of large investors’ BTC holdings rose from -0.25% to +2% between January 14 and 17, marking the highest monthly rate since mid-December.

On-chain data revealed that large investors have been one of the key drivers of bitcoin demand and price since the U.S. presidential election. This cohort of market participants has increased their holdings, while small investors have done the opposite. Between November 4 and January 24, the total holdings of large investors have grown from 16.2 million BTC to 16.4 million, while the stash of small investors has slumped from 1.75 million to 1.69 million BTC.

Large Investors Drive BTC Price

As large investors drive bitcoin demand and price, sell pressure has declined significantly, mainly after other holders sold their assets to realize profits during the rally in December. Analysts noted that realized daily profits were as high as $10 billion when BTC hovered around $100,000 in December.

Currently, daily realized profits have slumped to levels between $2 billion and $3 billion, indicating that traders have finished selling their BTC to a large extent. This can also be seen in traders’ unrealized profit margins falling to levels that often mark a price floor.

“The Traders’ On-chain Realized Profit Margin declined almost to zero in mid-January, after touching overheated levels near 60% in November-December as Bitcoin rallied towards $100K. A low realized profit margin for traders indicates there are less profits to be made by selling and hence lower selling pressure for Bitcoin,” CryptoQuant stated.