In investing and trading, retail investors are often considered “dumb money”, while institutional investors are considered “smart money”. Historically, this perception has been evident throughout Bitcoin cycles. For example, during the 2017 cycle, retail investors, represented by “shrimps” (holding less than 1 BTC) and “crabs” (holding 1-10 BTC), bought at the peak of the bull run. , accumulated around 360,000 BTC above the 30-day moving average, suggesting they are buying at peak levels.
However, recent events have shown a change in this dynamic. During major crises such as COVID-19 incident in March 2020, Luna’s collapse in June 2022, and FTX’s bankruptcy in November 2022, these retail groups accumulated significant amounts of Bitcoin at low prices. They accumulated around 135,000 BTC during the COVID-19 crash; 300,000 BTC when LUNA collapsed and 500,000 BTC during the FTX disaster.
In 2024, this trend will continue. Retail investors sold around 100,000 BTC at an all-time high in March, demonstrating strategic profit-taking. And as Bitcoin has consolidated over the past few months, they have accumulated. The evolution from “dumb money” to “smart money” of retail investors is a promising indicator for the market.
Bitcoin dominance rises again to 55% by mid-2024
Bitcoin (BTC.D) dominance in the digital asset market has fluctuated significantly in 2024, reflecting broader market dynamics and shifting investor sentiment. Earlier in the year, Bitcoin dominance fell from 53% to below 50%, coinciding with a period of volatility in its price, which hovered around $40,000. This trend reversed in mid-February, as Bitcoin regained its footing and its dominance increased to 55% by mid-April, reflecting renewed investor confidence following the halving event in April 2019. 2024.
Historically, Bitcoin’s market dominance has seen significant changes. At the end of 2020, BTC.D was around 65%, then gradually decreased to around 40% by mid-2021 as altcoins gained traction. However, a resurgence has been seen since mid-2022, stabilizing around 50% to 55% until early 2024. Latest data shows that Bitcoin dominance stabilized around 55% in June 2024. 2024, when Bitcoin price consolidates near $65,000.
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Itadori
Bitcoin Magazine
