Bitcoin Sheds ‘Dumb Money’ as Retail Purchase Most BTC

bitcoin cryptocurrency

Since the March 2020 meltdown, Bitcoin (BTC) has lost its ‘dumb money’ status as retail buyers have purchased the majority of the cryptocurrency.

According to findings, small-volume purchasers are just as interested in $48,000 Bitcoin as they were in $3,600 Bitcoin.

Regular investors are once again purchasing Bitcoin (BTC) around $48,000, according to data, which verifies the largest buying binge since March 2020.

Willy Woo, a statistician, noticed an important trend that had been missing from the Bitcoin (BTC) market for nearly 18 months in a tweet on December 14.

BTC is being added to retail like it’s March 2020

BTC-USD was a trendy selection for those able and willing to invest after plummeting below $3,600 in March 2020 — and it’s back now.

Changes in balances for wallets with Bitcoin or less — which usually indicate small-scale investors — have hit their highest level since March 2020.

While the circumstances stay the same (coronavirus worries and macro market jitters over central bank policies), the most significant difference by the end of 2021 is that Bitcoin prices $48,000 instead of $3,600.

Regardless, if the retail accumulation data is correct, interest is skyrocketing.

Woo noted, “The last time retail purchased the dip this hard was at the bottom of the COVID-19 crash.”

At current pricing levels, larger established hodlers continue to demonstrate mixed behavior. Despite some selling, the top tier – whales — are warier about abandoning BTC.

The divide between “smart” and “dumb” money has reached an all-time high.

Meanwhile, the share of long-term investors against short-term market participants has hit a new high.

There has never been a wider disparity between the amount of BTC held by “smart” and “dumb” money — long-term and short-term buyers — according to the so-called “Smart Money Gap” indicator, which is based on data from on-chain analytics firm Glassnode.

Local peaks in the metric have signaled the commencement of price bull runs throughout Bitcoin’s history, indicating local price bottoms.

The figures back up the theory that Bitcoin’s near 40% drop from all-time highs of $69,000 “flushed out” speculative market bets.

The Author

Samuel Adeshina

Samuel is a financial reporter whose interests include blockchain, market, business, insurance, and Crypto to provide relevant information to all interested.