As Bitcoin (BTC) continues to consolidate slightly below the $120,000 level, the dominance of new investors is steadily rising. However, on-chain data shows that BTC is still far from overheating, suggesting the premier cryptocurrency may have more room to run before a significant correction sets in.
According to a CryptoQuant Quicktake post by contributor AxelAdlerJr, new investor dominance in Bitcoin is gradually increasing – currently hovering around 30%, which is only halfway to the historical “overheated” threshold.
The analyst shared the following chart, which highlights two past instances – marked in orange – when new investor dominance reached overheated levels and coincided with BTC local price tops.
The first instance occurred in March 2024 when the metric hit 64%, and the second in December 2024 when it peaked at 72%. In both cases, BTC experienced a significant pullback, leading to the formation of local bottoms.
Notably, as the influx of new liquidity dried up during these phases, long-term holders began actively taking profits. This added further pressure on BTC’s price.
Currently, while new investor dominance is trending higher, it remains well below the euphoria zone – typically between 60% and 70% – suggesting more upside potential in BTC’s bullish momentum before exhaustion.
Meanwhile, older holders continue to sell moderately. The chart indicates a coefficient of 0.3, showing that the supply of three-year-old BTC is still absorbing fresh demand without sharp disruptions.
From a long-term perspective, the market remains balanced, and the risk of large-scale capitulation from veteran wallets appears low. AxelAdlerJr concluded:
If the indicator’s growth accelerates and approaches the historical corridor of 0.6-0.7, one should expect intensified profit-taking and, consequently, a correction. For now, the supply/demand structure remains in a healthy late bull cycle phase, when new money is coming in but old players have not yet transitioned to mass selling.
