Bitcoin analysis: rising retail interest suggests lower risk aversion

Bitcoin analysis: rising retail interest suggests lower risk aversion

There have been encouraging signs in the cryptocurrency market in recent weeks. Analysis of bitcoin transaction volumes shows that retail demand has increased by 13%, which may indicate a return of interest from retail investors in response to the rising price of the digital currency.

According to a recent report by analytics platform CryptoQuant, published on October 21, there was a significant increase in transactions valued at less than $1,000. This trend reflects the recovery in retail activity seen after a long period of stagnation and decline following record highs reaching over USD 69,000 in March.

Cauê Oliveira, a CryptoQuant contributor, pointed out that "retail demand has grown by about 13% in the last 30 days. We have only seen this scenario in March, when we were near all-time highs." While the whales have maintained high transaction volumes, retail investor activity has been declining and is only now starting to pick up again.

Since the beginning of October, Bitcoin has gained nearly 10% in value. This points to a possible return of retail investors, signaling a change in risk aversion in the market. "This recent rise in the value of bitcoin suggests that retail investors are returning to trading, which may be a sign of lower risk aversion," Oliveira added.

The market and its trends

Risk aversion is becoming an increasingly hot topic in cryptocurrency market debates. Circumstances in the global liquidity arena are increasing risk appetite, and experts believe that this trend may strengthen in the context of the upcoming presidential election in the United States.

In its latest newsletter, QCP Capital says: "Both BTC and ETH have not yet broken their July highs, but are approaching key resistance levels - $70,000 for Bitcoin and $2,800 for Ethereum. A break of these levels could attract massive attention from retailers."

Despite the steady rise in the BTC price, US retail investor interest in bitcoin remains strong. Data from CryptoQuant suggests that the Coinbase premium - the price difference between the BTC/USD pair on Coinbase and BTC/USDT on Binance - is currently very low, even though Bitcoin has reached its highest weekly close since June.

While the market continues to evolve and attract attention, it remains up to investors and traders to monitor these signals and adapt their strategies to current conditions. The growth in retail interest may provide new impetus for the crypto market's further development and stability.

*This is not investment advice.

Coingarage team