April closed with bitcoin (BTC) delivering a roughly 12% gain—the largest monthly advance in a year. Although the price pulled back slightly to about $75,000 by month-end, traders and analysts debated whether the upward move was rooted in durable fundamentals or driven by short-term speculation.
Market research firm CryptoQuant recently weighed in with on-chain analysis to explain the forces behind April’s rally and assess whether the pattern could persist into May.
On-chain indicators suggest speculative buying
In its latest weekly report, CryptoQuant attributes April’s price run primarily to demand originating in the perpetual futures market while spot-market demand contracted. That mix implies the rally was leveraged and speculative rather than supported by broad-based accumulation of bitcoin on the spot market.
Historically, periods where futures demand rises as spot demand weakens tend to precede unsustained price advances, particularly during bear phases. In such scenarios, the absence of strong spot buying undermines the structural foundation needed to maintain higher prices.
Throughout April, CryptoQuant’s “apparent demand” indicator—which tracks the 30-day change in estimated on-chain spot buying activity—remained in negative territory. At the same time, metrics that monitor perpetual futures demand expanded, reflecting growing speculative positioning among derivatives traders.
“The divergence between rising price and contracting spot demand is one of the clearest on-chain signals that price gains are speculative rather than structural. Apparent demand stayed negative across the full April price surge, confirming the absence of fundamental demand support,” CryptoQuant explained.
Could a multi-month decline follow?
CryptoQuant’s analysts also note that the current demand structure closely resembles conditions observed at the onset of the 2022 bear market. In that earlier episode, similar dynamics preceded a prolonged multi-month decline, suggesting a material downside risk if the pattern repeats.
That said, similarity in on-chain signals does not guarantee identical outcomes. Still, the present arrangement—rising futures demand paired with falling spot demand—has historically served as a reliable, early warning of price fragility and a typical bearish precedent.
Absent a reversal in apparent demand from negative to positive, rallies toward the roughly $79,000 area may struggle to find the support needed to break out and sustain higher levels. In other words, futures-driven price moves without concurrent spot accumulation are more vulnerable to sharp reversals.
Supporting this cautious view, CryptoQuant’s Bull Score Index declined during April, sliding from 50 to 40. That shift marks a move from neutral into bearish territory and indicates that on-chain fundamentals weakened after the speculative lift from futures activity.
In summary, while April’s price action showed impressive short-term gains for bitcoin, on-chain data points to leveraged speculative demand as the primary driver. Without renewed spot-market accumulation and a return of apparent demand to positive readings, the current rally may face significant headwinds, and the risk of a deeper multi-month correction remains elevated.