Bitcoin Fees Drop 86% While Market Confidence Soars As Dominance Reaches New Highs

Despite an 86% plunge in Bitcoin transaction fees this quarter, market confidence remains resilient, with Bitcoin’s dominance hitting its highest level since April 2021.

While Bitcoin’s price traded relatively flat throughout the quarter, major altcoins like Ethereum and smaller tokens hit new yearly lows.

In terms of market activity, the ‘dolphin tier’ of traders—those holding between 0.1 and 10 BTC—has seen significant growth since July 4th. Specifically, wallets holding 0.1 to 1 BTC have increased by 25,671, while wallets with 1 to 10 BTC grew by 4,013. This uptick marks a reversal after a period of contraction earlier in 2024.

Long-term Bitcoin holders, on the other hand, are taking profits, reducing their realized market cap by $6 billion. In contrast, short-term holders are ramping up, adding the same $6 billion to their realized cap, which signals growing risk appetite in the market.

Interestingly, Bitcoin has been trading below the realized price of short-term holders since June 22. Historically, when $BTC dips below this level, short-term holders tend to sell to avoid deeper losses, which could trigger a broader market sell-off.

Currently, this critical level is at $63,000, making it a key price point to watch for Bitcoin’s next market move.

Bitcoin Spot ETFs Recorded Notable Inflows

On the institutional front, Bitcoin spot ETFs saw notable inflows on October 4. The Bitcoin spot ETF received $25.59 million in net inflows, while Grayscale’s GBTC ETF saw an outflow of $13.91 million. Bitwise’s BITB ETF attracted $15.29 million in inflows, and Fidelity’s FBTC ETF added $13.63 million.

With these dynamics at play, Bitcoin’s position in the market remains strong, even as fees have declined significantly.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any service.

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Source: https://nulltx.com/bitcoin-fees-drop-86-while-market-confidence-soars-as-dominance-reaches-new-highs/