Fresh Capital Dries Up for Bitcoin Amid Weakening Demand

CryptoQuant analysts, led by Alex Adler Jr., are sounding the alarm about the state of Bitcoin's market. According to Adler, no fresh capital is flowing into Bitcoin, and instead, more money is leaving than entering the network.

This worrying trend is reflected in the Bitcoin New Investor Flow indicator, which has dropped to -$1.2 billion. Historically, this metric showed large positive inflows as new investors rushed into Bitcoin during bull markets. Now, however, those blue inflow spikes have disappeared and been replaced by red bars, indicating weak demand.

The lack of new capital entering the network is not the only concern. Market data shows that over 50% of Bitcoin's circulating supply is now being held at a loss, with 10.5 million BTC being held in this state. This condition has appeared near major market bottoms in the past, including in 2011, 2018, and 2022.

The spot Bitcoin ETF market also indicates a slowdown in fresh demand. Over the past month, U.S. spot Bitcoin ETFs have recorded roughly $6.3 billion in net outflows, suggesting that institutional investors, including BlackRock, are reducing their exposure to Bitcoin.