On-chain data indicates a remarkable turnaround in spot demand for Bitcoin, as the Apparent Demand metric has begun to grow for the first time since late November.
Bitcoin Apparent Demand Experiences Positive Shift
In a recent post on X, Julio Moreno, head of research at CryptoQuant, introduced intriguing developments in Bitcoin’s Apparent Demand. This vital on-chain indicator estimates the current spot demand for Bitcoin on the network by comparing two key metrics: mining issuance and changes in the 1-year inactive supply.
Mining issuance represents the daily amount of Bitcoin that miners generate through their activities, essentially measuring the cryptocurrency’s production output. In contrast, the 1-year inactive supply denotes coins that have remained untouched for more than a year, acting as a reflection of Bitcoin’s available inventory.
When the Apparent Demand metric registers a positive value, it indicates that the decline in inventory is surpassing the production rate, suggesting a rise in demand for BTC. Conversely, a negative value often indicates that coins are being conserved in inventory, likely due to diminished market activity.
The chart shared by Moreno reflects the fluctuating trend of the 30-day sum of Bitcoin’s Apparent Demand over recent months:
As shown, the Apparent Demand plunged into negative territory at the start of December, signifying decreased demand for the cryptocurrency. This trend continued throughout December and into the first half of January. However, a change began to materialize in the latter half of January.
While the data showed minimal signs of recovery during February, a significant shift occurred recently, with the metric moving back into positive territory. Moreno pointed out, “Bitcoin spot demand is growing for the first time since late November,” cautiously noting that the current increase remains modest, leaving the potential for further growth uncertain.
Moreover, the Coinbase Premium Index has also recently shifted to green for Bitcoin. This indicator, highlighted by CryptoQuant founder Ki Young Ju in another post on X, offers valuable insights into market dynamics.
The Coinbase Premium Index analyzes the percentage difference between Bitcoin prices on Coinbase and Binance, effectively showcasing how the platform’s user behavior in the U.S. diverges from Binance’s international audience.
Recent data displays a significant uptick in this index, indicating that institutional accumulation from American investors may have been a driving force behind the recent price rally.
BTC Price Update
As of the latest updates, Bitcoin is trading around $68,000, reflecting a 4% increase over the last 24 hours.
