As Bitcoin approaches its previous all-time high, retail investors are gradually reentering the market, but transfer activity remains subdued, according to data from CryptoQuant. Since Bitcoin’s local bottom on July 3, 2023, retail investors—defined as those holding less than 1 Bitcoin—have collectively added 18,000 Bitcoin, bringing their total to 1.753 million Bitcoin.
This increase highlights a cautious return of smaller investors, driven by bullish sentiment in the market. CryptoQuant suggests that this could signal the start of a potential bull run. In fact, Jeff Park, head of alpha strategies at Bitwise, has projected that Bitcoin might surge to $92,000 if Donald Trump wins the 2024 U.S. presidential election, according to Ruholamin Haqshanas at CryptoNews.
Retail Growth Slower Than Expected
Despite the uptick in holdings, the growth of retail investments remains slow by historical standards. Over the past 30 days, retail investors have only added 1,000 Bitcoin, indicating a more cautious approach compared to earlier periods. Back in May 2023, retail holdings spiked by 27,000 Bitcoin, but the current trend reflects a significant deceleration in accumulation.
In contrast, larger Bitcoin holders—those with portfolios between 1 and 10,000 Bitcoin—have been more aggressive in 2024. While retail investors have increased their holdings by 30,000 Bitcoin this year, large investors have accumulated a staggering 173,000 Bitcoin. This stark difference suggests that institutional or high-net-worth investors are the primary drivers of Bitcoin demand at present.
Low Transfer Activity Among Retail Investors
Adding to the caution, transfer activity among retail investors has also dropped. On September 21, 2024, daily Bitcoin transfers by retail investors fell to $326 million—the lowest level since at least 2020. Historically, such low transfer activity among retail participants often precedes significant Bitcoin price rallies, as observed in past bull markets.
Overall, while retail investors are slowly returning, their reduced accumulation rate and lower transfer activity reflect a more conservative approach compared to larger investors. However, their reentry, though modest, could still contribute significantly to the next Bitcoin rally as the market edges closer to previous highs.
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