Glassnode On-Chain Analytics Platform provided insight into why the price of Bitcoin recently fell below $70,000. The platform suggested that the flagship product is not yet seeing enough demand, which could push its price to new heights.
Demand for Bitcoin is still modest
In one of its last markets reports, Glassnode mentioned that “the rate at which new capital is flowing into the Bitcoin network has slowed significantly from its peak.” They made this claim based on the Realized Cap metric, which measures the value of each Bitcoin based on the last time it was traded. Glass knot claimed that Bitcoin's realized cap is currently $574 billion.
Related reading
![Bitcoin Price](https://www.newsbtc.com/wp-content/uploads/2024/05/Bitcoin-price-1.png?w=460&resize=460%2C265)
The platform further revealed that liquidity injection into Bitcoin has slowed down since the flagship crypto hit an all-time high. absolute record (ATH) of $73,750. This stands in stark contrast to the period before Bitcoin reached this ATH, with Glassnode noting that flows into Bitcoin at the time were “extremely large, peaking at a value of $3.38 billion per day.”
Meanwhile, Glassnode said that the Cap made “remains in positive territory dominated by profits and returns to a position of equilibrium.” However, they noted that modest demand for Bitcoin was still able to spark this recent rally thanks to “diminishing sell-side headwinds from mature investors.”
Basically, Glassnode suggested that things were looking up for Bitcoin, but that it could be much better if there were more capital inflows. There could indeed be an increase in capital inflows soon enough, given that Spot Bitcoin ETFs have exceeded their limits. net output series and record again an impressive net collection in their funds.
Data from Farside Investors shows that these funds have already seen nearly $700 million in net inflows this week. Specifically, these Bitcoin ETFs saw a net inflow of $305.7 million on May 21 alone. That day was also BlackRock iShares Bitcoin Trust (IBIT) most profitable day to date, with the fund raising $290 million.
Some positive points to remember
Glassnode also reviewed other vital on-chain metrics, which brought positive elements for the future trajectory of Bitcoin. The platform noted that there has been a “sharp decline” in Bitcoin’s sell-side risk ratio, which “suggests that the market has found a degree of balance during this correction.
![Bitcoin Price 2](https://www.newsbtc.com/wp-content/uploads/2024/05/Bitcoin-price-2.png?w=460&resize=460%2C265)
To gauge market volatility, they also measured the percentage range between the highest and lowest prices over the past 60 days. They concluded that “volatility continues to compress to levels typically seen after long consolidations and before major market movements.
Related reading
Meanwhile, Glasnode revealed that 2.14 million BTC on the Short-term holder (STH) the supply, currently at 3.36 million BTC, fell into an unrealized loss following the recent market correction. They say this suggests that a large portion of the BTC held by this category of investors is held at an unrealized loss, reducing the risk of heaviness developing.
Featured image created with Dall.E, chart from Tradingview.com