According to a crypto executive, Bitcoin enthusiasts who believe the cycle’s peak is still ahead due to a lack of retail investor participation may be relying on an outdated strategy.
“The notion that the cycle is not finished simply because there’s no on-chain retail activity warrants a re-evaluation,” stated Ki Young Ju, founder and CEO of CryptoQuant, in a post on X dated March 19.
Ju pointed out that those monitoring retail trends solely through on-chain metrics may not grasp the complete scenario.
“Retail investors are probably entering via ETFs — the paper Bitcoin layer — which isn’t reflected on-chain,” Ju explained.
“This results in a lower realized cap compared to direct flows into exchange deposit wallets,” he added, highlighting that retail investors account for 80% of spot Bitcoin (BTC) exchange-traded fund (ETF) inflows, a trend previously noted by Binance analysts last October.
Since spot Bitcoin ETFs were introduced in January 2024, the inflows have reached approximately $35.88 billion. Source: Farside
The analysts had reported that a significant portion of ETF purchases likely stemmed from retail investors shifting their investments from wallets and exchanges into funds with increased regulatory protection.
Ju was responding to counterarguments regarding his earlier post on X on March 17, where he declared that the “Bitcoin bull cycle is over.”
“For the past two years, I’ve been predicting a bull market, even when indicators suggested otherwise. I apologize for changing my position, but it now appears evident that we are entering a bear market,” he remarked.
Ju elaborated that specific indicators are signaling a shortage of new liquidity, likely influenced by macroeconomic factors.
He also clarified that when he stated the bull cycle had ended, he meant it might take Bitcoin “6-12 months” to surpass its all-time high, rather than predicting an imminent crash.
Related: Analysts assert Bitcoin is merely experiencing a ‘normal correction,’ and the cycle’s peak is still ahead
Traders frequently monitor retail investor behavior to identify potential exhaustion points or as a cue to sell when the market appears overvalued.
A variety of sentiment indicators assist market players in gauging retail interest levels, including the Crypto Fear & Greed Index, which currently reflects a “Fear” score of 31, a decline of 18 points from the previous day’s “Neutral” score of 49.
Additional common indicators for assessing retail interest in the crypto market consist of Google search trends for “crypto” and related terms, as well as the popularity of crypto apps in major global app stores.
While the Google search index for “crypto” peaked at a score of 100 during the week of January 19 – 25, coinciding with Bitcoin’s all-time high of $109,000 and US President Donald Trump’s inauguration, it has since dropped nearly 62%.
The Google searches for “crypto” have fallen by almost 62% since the end of January. Source: Google Trends
As of publication, the Google search score for “crypto” is at 38, while Bitcoin is trading 22% below its January all-time high.
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This article does not constitute investment advice or recommendations. Every investment and trading decision carries risk, and readers should perform their own research before proceeding.
