By: Matt Weller, Head of Market Research
Bitcoin ETF purchases are rising again after a lull that stretched through the first half of the year, bringing institutional and retail money back into Bitcoin. The rebound comes as the supply of Bitcoin left untouched for at least a year climbs to its highest level of the year, a sign that long-term holders are not selling. Together, the two trends put Bitcoin demand on firmer footing just as central banks begin raising interest rates and money supply growth slows.
Matthew Weller, StoneX Media, Head of Market Commentary, has spent more than 15 years analyzing financial markets and has delivered more than 1,300 educational webinars on trading and trading psychology. His research covers forex, equity and commodity markets through a mix of fundamental, technical and sentiment analysis, the same toolkit he applies to Bitcoin's cycle, holder behavior and fund flows.
Bitcoin ETF purchases are turning higher again after a lull that lasted through the first half of the year, restoring a source of demand that had faded. Weller points to that shift directly, observing that "ETF purchases are turning higher after a bit of a lull" as the cycle moves on from its crypto winter phase. The renewed buying brings both institutional and retail money into Bitcoin through ETFs, adding a tailwind for Bitcoin prices. Notably, the Bitcoin ETF rebound arrives alongside other supportive signals, including valuation metrics such as the MVRV score turning higher.
"Long term holders of Bitcoin are keeping their diamond hands, if you will, holding on to their Bitcoin," Weller says, pointing to the supply of Bitcoin last active at least one year ago. That measure of dormant Bitcoin supply is ticking up to its highest level of the year, showing that long-term holders are choosing to sit tight rather than sell. In contrast to Bitcoin ETF purchases, which bring fresh money in, long-term holders shape the market by keeping coins out of circulation. Weller describes this holder behavior as a bullish factor for the cryptocurrency, and it lands at the same time as ETF buying picks up, so both forces push Bitcoin demand in the same direction.
--- Written by Frédéric Guétin, StoneX Media Producer
--- Expert: Matthew Weller, StoneX Media, Head of Market Commentary
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