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Demand for Bitcoin from large investors and permanent holders is growing. However, according to a recent report from CryptoQuant, USDT’s market capitalization growth is slowing and Bitcoin (BTC) has yet to see a significant price rebound.
“Stablecoin liquidity has yet to regain its growth trajectory to support price gains,” CryptoQuant said. “The growth rate of Tether’s USDT market capitalization, which represents new liquidity in the cryptocurrency market, continues to slow, growing at the slowest rate since February 11.”
As mentioned, demand for Bitcoin is gathering pace among large investors and long-term holders, known as whales. The monthly demand growth rate for these groups was 4.4%, the fastest increase since April.
Over the past 30 days, these Bitcoin holders have added 70,000 BTC to their holdings, the largest accumulation since April. According to the report, this reflects the pre-2020 rally phase, when large investors invested approximately $1 billion in Bitcoin.
Despite low volatility in Bitcoin price, on-chain activity remains active. Data shows that institutional investors are actively purchasing Bitcoin for their custody wallets. In addition, long-term holders’ savings have also resumed.
The report also notes that selling pressure on Bitcoin has decreased as traders have mostly completed profit-taking. Unrealized profits have fallen from 69% in early March to a low of 3%, which is expected to reduce selling pressure going forward.
At the same time, Ethereum (ETH) has seen a surge in demand, especially after the spot Ethereum ETF was approved in the US, with daily purchases by perpetual holders reaching an average of 40,000 ETH since May 20.
Despite optimistic signs of increased institutional buying and the launch of spot ETFs, CryptoQuant’s report suggests that sluggish growth in stablecoin liquidity could hamper Bitcoin’s major price upside prospects in the near term.
Bitcoin price remains stagnant despite strong inflows into US spot Bitcoin ETFs.
The report also highlights a notable increase in Bitcoin acquisitions from the U.S. Spot Bitcoin ETF (ETF), with total holdings increasing from 819,000 to 859,000 between May 1 and June 6.
According to data from Farside, U.S. spot Bitcoin funds recorded net inflows of $131 million on June 7, marking their 19th consecutive day of inflows.
Historically, strong Bitcoin ETF inflows have been accompanied by rising Bitcoin prices. However, price movements over the past two weeks indicate that ETF flows are not the only factor influencing Bitcoin price movements.
Bitcoin prices fell from around $72,000 to $69,000 on Friday following the jobs report and unemployment data, according to data from CoinGecko.
At press time, Bitcoin is trading around $69,200, down slightly over the past 24 hours and about 6% off the all-time high set in March.
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