Retail investors were responsible for Bitcoin’s best run since October 2021
Retail investors are piling into Bitcoin despite ongoing regulation and price uncertainty. Barons.
Since July 13th, Bitcoin has been on an upward trend, with its value increasing by 18%. The uptrend was cut short after he peaked at $24,700 on July 30.
Nevertheless, this performance was BTC’s best run of form since October 2021.
Bitcoin price movement slows down
Following its $24,700 peak, BTC has traded relatively flat before closing daily lows. Analysts attribute rising tensions between the US and China over House Speaker Pelosi’s visit to Taiwan to a loss of momentum.
Further headwinds are blowing on the macro front. August 4th, bank of england has announced that the UK will enter a recession in the last quarter of the year.
As a result, growth forecasts for next year have been revised downward. The central bank also raised interest rates by 0.5%, setting the base rate at 1.75%, to counter sharp inflation projected to rise to 13%. This is the largest rate of increase since 1997.
The cryptocurrency market did not react immediately, with Bitcoin prices at between $22,700 and $23,000 at the time of the announcement.
US Retail Investors Stack on BTC
“Retailers, especially US retail investors, are buying bitcoin at the fastest rates in history,” said Marcus Sotiriou, an analyst at digital asset brokerage firm GlobalBlock. suggests that the reason for
To support this statement, Sotiriou mentioned several metrics, including the Coinbase Premium Gap (CPG), which is the difference between BTC prices on Coinbase and Binance.
Given that Coinbase is the largest US exchange, the platform’s price can be seen as an indicator of demand in the US compared to other places. CPG analysis showed a $25 discount on July 12th. In the past month, discount has turned into premium for the first time in months.
By the end of July, CPG offered a $14 premium to Coinbase users. This is the largest amount since BTC traded at his $40,000 mark around May.
In addition, the Messari data showed changing dynamics between whale and small accounts. Bitcoin in up to 1% of accounts fell from 17.34 million to 17.32 million in July. Conversely, Bitcoin in accounts over $10,000 increased from 18.2 million to 18.4 million over the same period.
A similar pattern is playing out in derivatives. Valued at 10% of the Bitcoin price ($2,300) and traded by retail traders, CME’s microcontracts saw a significant increase in open interest from 15,998 to 24,960 since the beginning of July.
In contrast, the standard contract valued at 5 Bitcoins ($115,000) and favored by institutional investors saw a slight increase in open interest from 13,466 to 13,480.
