Bitcoin Faces Equilibrium as Demand Gradually Declines
Bitcoin’s demand is weakening post-May peak but remains enough to balance selling. Market stays stable in supply-demand equilibrium.
- BTC demand has declined since May’s local top.
- New supply vs. 1-year inactive supply shows reduced appetite.
- Market is balanced but lacks strength for upside breakout.
Market Finds Balance Amid Cooling Demand
Bitcoin (BTC) is currently caught in a quiet standoff. Although some investors recently took profits, selling pressure remains relatively mild. The broader sentiment still leans toward holding. However, Bitcoin’s upward momentum is limited by a gradual decline in market demand.
Supply-Demand Ratio Reveals the Story
A key on-chain metric—the ratio between newly issued supply and 1-year+ inactive supply—helps explain the situation. When this ratio is above zero, it indicates a positive demand environment: more coins are being reactivated from long-term holding than are entering circulation via mining.
Following the last local high in May, this ratio has been steadily declining, pointing to a slow drop in demand. Although the ratio remains above zero—meaning the market is still absorbing new supply—the energy behind BTC’s past rallies has cooled.
What This Means for Bitcoin’s Price Action
- No breakout fuel: Without stronger demand, BTC lacks the power to push higher.
- Stable market: Even with reduced demand, the balance with supply keeps prices relatively stable.
- Equilibrium phase: This balance marks a quiet period where neither bulls nor bears dominate.
If new demand doesn’t increase soon—through retail interest, institutional inflows, or macro triggers like interest rate cuts—Bitcoin may remain in this state of equilibrium. Traders and investors are now watching for signs of renewed buying pressure that could lift BTC out of this neutral zone.
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