Bitcoin hit a historical high of $111,963 in May, but its upward momentum has since cooled, dropping to $103,078 on May 31. At the time of writing, Bitcoin was trading at $104,785, with no clear direction on whether it is consolidating for a potential breakthrough or has reached a temporary peak.
Bitcoin Google Search Interest Declines
According to the latest Google Trends data, Bitcoin's ranking on the Google search trends has significantly dropped to 25th place, with a search interest index of 30, marking a new low since October last year.
Regarding the waning Bitcoin interest, CoinDesk reported that this phenomenon indicates a clear lack of retail investor interest, market excitement, and speculative desire.
The report also analyzed that this low interest coincides with Bitcoin's historically low volatility. The Bitcoin volatility index (DVOL) is slightly above 40, one of the lowest levels in the past two years, second only to the trough in mid-2023.
Deribit's implied volatility indicator further highlights the market stagnation: the IV ranking (current implied volatility compared to the past year) is only 2.3, close to the year's lowest point, with an IV percentile as low as 0.3, indicating that the implied volatility has been lower than this level for less than 1% of the past 12 months.
Sygnum Bank: Bitcoin to Gain New Momentum from US Debt Market Volatility and Weakening Dollar
Despite the current reduction in Bitcoin discussion, Sygnum Bank's latest market analysis report remains optimistic about Bitcoin's future:
Bitcoin's position as a hedge asset gains new momentum from US Treasury market volatility and a weakening dollar. Over the past 18 months, Bitcoin's liquid supply has decreased by about 30%, which could lay the groundwork for price appreciation in the coming months.
Specifically, Sygnum Bank's positive outlook on Bitcoin includes:
- Market Dynamics and Liquidity Pressure: Analysts note that Bitcoin's liquid supply is severely limited, while demand trends continue to improve, creating conditions for price appreciation. Increased ETF fund inflows and governments' open attitude towards Bitcoin reserves are driving a "demand shock" scenario, where buyers chase scarce coins.
- Strengthened Hedge Asset Status: Declining US Treasury prices and surging federal debt are pushing investors towards gold and Bitcoin. Bitcoin's resilience in fiscal headwinds shows it is becoming the preferred hedge asset, with a weakening dollar and Treasury market volatility further solidifying its position.
- Geopolitical Demand Catalyst: The report also emphasizes geopolitical factors driving new demand growth. For example, three US states have passed Bitcoin reserve laws, and Pakistan and a leading UK political party are considering official Bitcoin reserve allocation.
