chain data and holding patterns indicate a notable reduction in demand for Bitcoin (BTC), as interest in BTC ETFs appears to wane. This shift has prompted a bearish sentiment surrounding the leading cryptocurrency, which has been languishing in a state of price stagnation.

According to CryptoQuant, an on-chain analytics firm, demand for Bitcoin has notably slackened since early April and has even dipped into negative territory in the current month. The firm noted in a Wednesday report to CoinDesk, “The observable demand for Bitcoin has diminished significantly since early April, with this decline deepening into negative figures recently.” They added, “For Bitcoin to experience a sustainable price recovery and potential new peaks, demand growth must show substantial improvement.”

CryptoQuant’s demand indicator, which assesses the disparity between daily Bitcoin block rewards and the daily change in the number of Bitcoin that has remained unmoved for over a year, underscores this trend. The increase in sales from major holders suggests a decreasing appetite for the cryptocurrency. Typically, miners sell their Bitcoin rewards to fund operations, and rising sales from substantial holders hint at weakening demand.

The Bitcoin market has seen limited volatility, with substantial selling pressure over recent months. This has tempered the optimism generated by the launch of several Bitcoin ETFs in January. While the initiation of ETF trading and the Bitcoin halving event in May led some bullish traders to target the $80,000 mark by June, prices have since retreated by 20% from May’s all-time highs. Bitcoin ETFs have amassed $17.5 billion in net inflows since their introduction, yet critics argue that this influx may be more indicative of carry trades rather than outright bullish speculation.

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Moreover, initial ETF inflows are gradually diminishing. “The growth rate in the holdings of significant Bitcoin investors has decelerated from 6% per month in March to a mere 1% now,” CryptoQuant reported. This deceleration aligns with reduced purchases from U.S. spot ETFs, which have decreased from an average of 12,500 BTC per day in March—when Bitcoin was priced above $70,000—to just 1,300 BTC last week.

Conversely, long-term holders—those retaining their Bitcoin for over six months—continue to accumulate the asset at record-breaking levels, with their collective balance reaching a new high of 391,000 BTC earlier this week. Additionally, the market capitalization of stablecoins has surged to a new peak of $165 billion, a traditionally bullish indicator suggesting increased liquidity in the crypto market, which often leads to higher prices.