- Bitcoin price struggles to maintain high $90,000 prices.
- Despite this, Bitcoin demand skyrockets in December.
- Analyst shares the many factors behind BTC demand increase.
As Bitcoin price struggles to maintain dominance, analysts note a growing demand for Bitcoin (BTC) in December. To highlight, accumulator addresses added a staggering 225,280 BTC to their holdings, reflecting an 82.6% increase compared to the previous month, according to data from CryptoQuant.
Bitcoin Demand Skyrockets in December
This surge in accumulation underscores a growing appetite for Bitcoin, even amid fluctuating market conditions. Moreover, the total sell-side liquidity dropped by 590,000 BTC during December, with 520,000 BTC disappearing from the market in a concentrated period between December 22 and 23.
This sharp decline in available Bitcoin indicates strong absorption of sell-side pressure by eager buyers. Large over-the-counter (OTC) trading desks also experienced a drop in their Bitcoin supply, declining from 421,000 BTC to 403,000 BTC. This movement suggests that institutional and large-scale investors remain highly active in the market, driving continued demand.
Factors Behind Increased BTC Demand
Meanwhile, whales sold 8,600 BTC during December, short-term holders increased their positions, adding 641,789 BTC throughout 2023. This marks a total of 3.81 million BTC held by short-term investors, nearing an all-time high. Despite the bullish accumulation trends, caution is warranted.
The supply of Tether (USDT) on exchanges is decreasing, while BTC supply is showing a slight uptick. These signals may point to short-term bearish pressure. Overall, demand is effectively absorbing selling pressure, and the long-term outlook for Bitcoin remains bullish. Despite potential short-term corrections, the broader market trajectory for Bitcoin continues to inspire confidence.
