Bitcoin’s $2 Trillion Market Cap Attracts Retail Investors, But Caution from Veterans Suggests Potential Pause in Growth
Bitcoin (BTC) has reached a significant milestone, surpassing a $2 trillion market capitalization, sparking enthusiasm among first-time buyers, yet raising concerns of price consolidation as veteran traders remain cautious, according to recent on-chain data analysis by Glassnode.
After hitting a record high of over $100,000 per Bitcoin on Thursday, its market cap climbed above $2 trillion, marking the first time since January 31, as per data from TradingView. Bitcoin has maintained this valuation, with expectations of further price movements, especially as U.S. inflation data is set to be released later this week.
Glassnode’s data reveals that first-time buyers are driving much of the demand, with a noticeable surge in retail interest, often attributed to the fear of missing out (FOMO). FOMO typically occurs when investors make hasty decisions based on seeing others make gains, fearing that they will miss an opportunity for high returns.
“BTC Supply Mapping reveals robust demand from first-time buyers. The First-Time Buyers RSI has remained at 100 throughout the week, signaling sustained interest from new participants,” Glassnode reported on X.
The First-Time Buyers RSI at 100 is an indicator of strong market interest, with many new wallets entering the space for the first time. This influx of new buyers suggests that retail investors are fueling Bitcoin’s price movement, driving the coin’s continued upward momentum.
However, the data also highlights the lack of support from momentum traders, who tend to follow established trends and capitalize on price movements. According to Glassnode, the 30-day RSI for momentum buyers is only 11, signaling weak participation from this group.
“Momentum Buyers remain subdued (RSI ~11), and there is an increasing presence of Profit Takers. A slowdown in fresh inflows could result in consolidation, as the market loses the momentum needed to drive higher prices,” Glassnode warned.
The divergence between strong retail demand and a lack of momentum from seasoned traders raises the possibility that Bitcoin’s rally could face a temporary halt or pullback. Without continued buying pressure from experienced market participants, the market may see consolidation before any significant new price advances.
