Lucía Peña
Bitcoin’s demand appears to have stabilized but will need to see significant growth in the fourth quarter to maintain higher prices, according to a report released by CryptoQuant analysts on Tuesday.
Since July, CryptoQuant has measured Bitcoin’s demand by calculating the difference between the daily bitcoin block subsidy and the daily change in bitcoin that has remained untouched for over a year. This metric has varied between a monthly loss of 23,000 BTC and a gain of 69,000 BTC. In September, however, demand showed steady growth, with less volatility compared to previous months.
Despite this uptick, the increase in demand throughout September was not enough to spark a lasting price surge. Analysts highlighted that, in comparison, demand in April saw a rise of 496,000 BTC when prices were around $70,000, suggesting that demand still has considerable room to grow in the upcoming quarter.
The report also noted similarities between the behavior of BTC holders at the start of 2024 and past halving cycles in 2016 and 2020. Earlier this year, long-term holders sold BTC to new buyers, which fueled demand, but this trend slowed down over the summer.
“If historical patterns hold true, we should see demand growth pick up again, potentially increasing the short-term supply,” the report added.
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Increase in spot Bitcoin ETF demand in September
One area that showed renewed strength was U.S. spot exchange-traded funds (ETFs). September saw a shift from net selling of 5,000 BTC at the start of the month to net buying of 7,000 BTC by the end of September—the highest single-day purchase volume since July.
“Spot ETFs bought an average of nearly 9,000 BTC daily in the first quarter of 2024, contributing to the rise in BTC prices. If this demand from ETFs continues to grow, it could help push prices higher in the last quarter of 2024,” the analysts noted.
However, despite this positive momentum, there was a net outflow from spot ETFs on Tuesday—the first since September 3—breaking an eight-day streak of inflows. BlackRock’s IBIT, the largest spot BTC ETF, was the only fund among the top 12 to record positive flows, receiving $40.84 million in new investments.
