Bitcoin Bulls Catch a Bid — But Spot Demand Is Still Ghosting the Party 👻

Bitcoin [BTC] is beginning to regain demand after weeks of persistent selling pressure weakened participation across both spot and derivatives markets. Over the past week, the 30-day cumulative demand rebounded sharply from nearly -500,000 BTC to around -75,000 BTC, indicating that risk appetite is gradually returning. Futures demand recovered from roughly -295,000 BTC to slightly above neutral, while spot demand remained weak near -78,000 BTC, a divergence that shows long-term investors are still waiting for stronger confirmation before deploying meaningful capital.

The options market is mirroring that caution. During the February and June selloffs, put implied volatility surged as traders hedged against deeper losses. In July, as Bitcoin traded between $60,000 and $65,000, downside premiums cooled noticeably, signaling that expectations are shifting from another capitulation toward a slower bottoming process following several months of declines. Even so, calmer options pricing has not translated into renewed conviction, as ETF participation remains inconsistent and spot accumulation continues to lag derivative demand.

Supply-side dynamics are also shaping the recovery. Long-term holder realized losses remain elevated on the 30-day Moving Average, though they have moderated from the extreme spikes recorded during the 2022 bear market. Realized profit and loss data shows short-term holders continue accounting for a larger share of market activity, a sign that newer investors remain uncertain as prices stabilize and that supply is gradually rotating from experienced holders to fresh participants rather than disappearing altogether.

Increased demand for Bitcoin is absorbing most of the distribution from those selling, but until long-term holder selling slows further and fresh capital flows back into spot markets, BTC's recovery is likely to remain gradual rather than accelerate into a sustained bullish trend.