Bitcoin buyers outrank sellers despite brutal market crash

However, bad news has continued to plague the broader crypto industry since the beginning of the year, with the collapse of stablecoin Terra and the closure of major lender Celsius denting investor confidence.

Additionally, last week Elon Musk’s car company Tesla announced it had sold around 75 per cent of its Bitcoin holdings, worth around $1.3 billion, after a poor quarter, a move which many viewed as a reversal of Musk’s previously bullish view on digital assets.

Bowler says she believes the demand from buyers could be driven by some sceptical investors who didn’t believe Bitcoin was fairly valued at the $80,000 plus price it demanded last year, but are willing to buy in now the asset has significantly devalued.

“Those who have previously held bearish views about where the price of Bitcoin is at, I think they’re the ones who are coming in now to get access to the market,” she says.

However, sellers’ reluctance to part with their crypto may only last so long, Honan says, warning that a prolonged bear market could see even the sturdiest of traders start to cut their losses.

“The fundamentals of Bitcoin and other major cryptocurrencies remain strong, especially across areas like retail and business adoption,” he said.

“That’s not to say you couldn’t see the market flip. If prices declined for say another six to nine months, you might start to see the execution of more sell orders.”

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