This week was one of two clear halvings in Bitcoin’s price, with the most significant cryptocurrency rising to a up-to-date record high and falling by around 13% a few days later. On Friday, December 20, the price of BTC dropped to just $92,000.

This piercing decline in Bitcoin’s price followed the U.S. Federal Reserve’s interest rate cut, which also caused declines in other financial markets. However, it is worth mentioning that the most significant cryptocurrency is starting to show signs of recovery, currently hovering around $97,000.

Could surging demand push the BTC price back above $100,000?

In a recent report on December 20, market intelligence platform CryptoQuant revealed compelling on-chain development with Bitcoin demand and supply dynamics. According to the blockchain company, the BTC market appears to be enjoying renewed investor interest.

The relevant metric here is the total OTC desk balance, which tracks the amount of Bitcoin held at addresses associated with over-the-counter (OTC) sales desks. This indicator provides insight into BTC supply for immense investors and institutional players.

According to CryptoQuant data, OTC outlets are seeing the largest monthly decline in inventory in 2024, falling by over 26,000 BTC in December. This decline has been even more significant over the last 30 days, with the balance down 40,000 BTC since November 20.

This decline in the total OTC desk balance is a bullish indicator that reflects increasing demand for Bitcoin and shrinking supply at the same time. Typically, the decreasing supply of BTC in the open market could set the stage for a period of significant price appreciation.

CryptoQuant noted that Bitcoin’s price rose from $40,000 to around $74,000 in the first quarter of 2024 after a surge in demand caused OTC desk stocks to decline. According to market intelligence, OTC stocks are starting to approach levels seen during the first quarter rally.

Data from CryptoQuant shows that apparent demand for Bitcoin is currently growing at a rate of 228,000 BTC per month after entering expansion territory in overdue September. At the same time, the balance of accumulation addresses is growing at a record pace of 495,000 BTC per month.

Bitcoin price at a glance

At the time of writing, Bitcoin is trading at around $97,655, reflecting a decline of 0.1% over the last 24 hours. According to CoinGecko data, the main cryptocurrency fell by almost 4% on a weekly basis.

Featured image by DALL-E, chart from TradingView