Bitcoin Spot Demand Growing For First Time Since Early October: CryptoQuant Head

CryptoQuant’s head of research, Julio Moreno, has highlighted the recent development in the Bitcoin metric called 'Apparent Demand', which is showing growth for the first time in more than a month. According to on-chain analytics, this metric measures the spot demand for Bitcoin by comparing the cryptocurrency's production with changes in its inventory.

The Apparent Demand indicator is calculated as the difference between Bitcoin’s production—the daily amount introduced by miners—and the 1-year inactive supply inventory. In a chart shared by Moreno, it was observed that the 30-day sum of the Apparent Demand showed negative values last month, indicating a decline in demand. However, recent trends reveal a sharp reversal into positive territory, signaling that Bitcoin demand is growing again for the first time since early October.

Though spot demand appears to be growing, the perpetual futures market seems to be witnessing a slowdown. According to on-chain analyst Glassnode, the Bitcoin Futures Open Interest—which measures the total open perpetual futures positions—remains at low levels. This drop began following a major leverage flush in October, caused by a large drawdown in Bitcoin prices that liquidated numerous positions. Since then, derivatives activity has slowed significantly, reflecting the overall subdued market sentiment.

Another area experiencing weak demand is the US Bitcoin spot exchange-traded funds (ETFs). A separate chart from Glassnode reveals that US Bitcoin spot ETFs have mostly faced outflows since early October. Glassnode explains that this trend hints at a broader de-risking phase among ETF investors, as they pull back from the cryptocurrency market in light of recent conditions.

At the time of writing, Bitcoin's price has retraced some of its recent gains, dropping to $103,200. Despite fluctuations in various metrics, the overall market sentiment remains cautious.