• On-chain data indicates a significant slowdown in bitcoin demand since early April, with metrics like CryptoQuant's demand indicator showing negative growth, reflecting increased selling.

• Despite the bearish signals, some metrics remain robust. Long-term holders are accumulating bitcoin at record levels.

• The total market cap of stablecoins has hit an all-time high, suggesting increased liquidity which historically precedes price surges. However, the growth in ETF inflows and large investor holdings has notably slowed down.

Demand metrics using on-chain patterns and holding behavior show weakening sentiment for bitcoin {{BTC}}, drawing bearish views to the largest token amid weeks of sideways price action.

“Apparent demand has slowed considerably since early April and even dipped into negative territory this month,” on-chain analytics firm CryptoQuant shared in a Wednesday note to CoinDesk.

“Bitcoin demand growth still needs to pick up before we can see a sustainable recovery in price and the possibility of new highs,” the firm said.

CryptoQuant cited its demand indicator, which tracks the difference between the daily total bitcoin block rewards and the daily change in the number of bitcoin that has not moved in one year or more. Bitcoin rewards earned by miners are typically sold to cover operations, but an increase in selling from large holders indicates a waning demand for the asset.

Bitcoin price action has largely remained muted. In the past months, billions of dollars worth of selling pressure have flooded the market, denting optimism from the January launch of several spot ETFs.

The start of ETF trading in January and the Bitcoin halving event in May saw some bulls target the $80,000 level by June, citing a boost in demand, but prices are down 20% since May's lifetime highs. Bitcoin ETFs have attracted $17.5 billion in net inflows since launch, but skeptics say that flow could be arising for capturing a carry trade instead of representing outright bullish bets.

And the initial flows for the ETFs are slowly decreasing.

“The growth in the total holdings of large Bitcoin investors has also slowed, from a monthly pace of 6% in March to just 1% currently,” the firm said. “This slowdown in Bitcoin demand coincided with smaller purchases from spot ETFs in the USA."

“The average daily purchases from bitcoin spot ETFs in the USA have declined from 12.5K in March, when bitcoin was trading above $70K, to an average of 1.3K Bitcoin last week,” the firm added.

However, a few metrics have remained strong during this period of weak prices, CryptoQuant noted.

Long-term holders—or wallets that hold the asset longer than six months—have continued accumulating bitcoin at “unprecedented levels,” with this cohort's total balance reaching a record-high monthly rate of 391,000 BTC earlier this week.

Elsewhere, the total market capitalization of stablecoins has surged to a fresh record high of $165 billion, a historically bullish sign that indicates increasing liquidity in the crypto market that typically leads to higher prices.