Markets
Bitcoin, Ethereum price rally is far from over: Investing.com’s CryptoQuant
Large investments by major shareholders and institutional investors have supported prices, fueling a broader market recovery. A report from CryptoQuant highlights this surge as a key factor in a steady rise in prices in the cryptocurrency market.
The report discusses several key factors contributing to the increase in demand for Bitcoin. First, there has been faster growth in the total balances held by permanent holders and large investors. Over the past 30 days, permanent Bitcoin holders have accumulated 70,000 Bitcoins, marking the largest increase since late April.
According to analysts at CryptoQuant, daily inflows from new large investors into Bitcoin have reached $1 billion, paralleling the massive period of accumulation seen in 2020 before Bitcoin’s rally from $10,000 to $70,000.
Additionally, there has been an increase in Bitcoin buying from spot ETFs in the US, with total holdings rising from 819,000 on May 1 to 859,000 currently.
CryptoQuant said these purchases have been a significant source of demand this year. Additionally, selling pressure from traders has eased, with the unrealized profit rate reset to 0%. This indicates that heavy selling by traders has been exhausted.
The on-chain data analytics firm’s report reveals that demand for Ethereum has also increased since May 20, following the approval of ETH spot ETFs in the United States. Daily ETH purchasing by permanent holders averaged 40,000 ETH following the ETF’s approval, compared to 5,000 ETH before the announcement.
The report suggests that large investors’ total holdings of ETH have also increased, reaching 16 million ETH, up from 15.4 million before the ETF’s approval and 14.9 million at the start of 2024.
The report concludes that despite positive trends for Bitcoin and Ethereum, stablecoin liquidity has yet to recover its growth trajectory, which is essential to support broader price upside.
CryptoQuant warns that Tether’s USDT market capitalization growth, an indicator of new liquidity in cryptocurrency markets, continues to decelerate, growing at the slowest pace since February 11.