Bitcoin demand spiked last week, according to onchain analytics firm CryptoQuant, helping lead to a more than 5% rally in the price of bitcoin to just under $68,000, a ten-week high.
Bitcoin’s apparent demand, or the difference between production and changes in inventory, jumped to a monthly growth of 177,000 bitcoin last week, the largest reading in the indicator since late April, according to CryptoQuant’s latest report.
Increased purchases of bitcoin by spot bitcoin ETFs have been one key factor in the increased demand, with the funds buying close to 8,000 bitcoin a day, the highest level of daily purchasing since July 21. “If ETF demand continues to accelerate, it can propel prices up in the last quarter of 2024,” CryptoQuant wrote.
In addition, whales have continued to accumulate bitcoin, with the group collectively now holding approximately 670,000 bitcoin. The growth of holdings by bitcoin whales stands above its 365-day moving average, which CryptoQuant noted is a “positive sign for prices.”
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CryptoQuant also noted that there are seasonal factors working in bitcoin’s favor right now. Bitcoin usually performs well in the fourth quarter during a bull cycle, as we are in now, and that’s particularly the case in a halving year, when mining rewards are cut by 50%.
“In 2012, 2016, and 2020, halving years, the price of bitcoin increased by 9%, 59% and 171%, respectively. So far Q4 2024, bitcoin is behaving very similar to 2016 and 2020,” CryptoQuant wrote.
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UPDATE (Oct. 16 5:27 p.m. ET): Added quote from CryptoQuant about spot bitcoin ETF demand.
