The crypto market experienced a significant drop in mid-March in line with what happened in the global financial markets.

But some retail investors took the dip as a buying opportunity.

According to the latest report from the company CoinMetrics The number of addresses containing relatively small amounts of bitcoin has increased since the March 12th plunge, and as excerpted from the report:

The number of addresses holding small amounts of bitcoin has increased by nearly 6% over the past 90 days.

This increase was seen when the price of Bitcoin dropped to an annual low of $3,800.

The report suggested that with the increase in small purchases and the emergence of new online wallets, this may indicate that adoption is growing, as new users begin to acquire relatively small amounts of bitcoin.

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But it should be noted that there is no guarantee that these new wallet numbers are for new users, as a single user could split their Bitcoin holdings among multiple addresses, for example.

However, the report supports other data coming from the crash which indicates that investors are buying Bitcoin on the dip.

For example, crypto asset management firm Bitwise published trading volumes from cryptocurrency exchanges the day after the drop that showed $5 billion in new inflows into bitcoin.

Nick Carter, founder of Coin Metrics, told Coin Metrics that this pattern is an inverse pattern for some institutional investors who entered bitcoin after 2017, while small investors use the dip to buy bitcoin and large institutions run toward the dollar.

He explained:

It seems to me that the recent crash was largely a case of retail investors buying the dip and institutional investors out of the market.

Carter said that the overall liquidity of Bitcoin has decreased structurally since the drop event, and cited two investment funds (Adaptive Capital and Cryptolab Capital) that rose during the market turmoil after trading on Bitmex.

Since Bitmex hosts such an offshore volume of bitcoin trading, it may have an impact on the recent crash as well.

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Coin Metrics explained how the Bitmex Liquidation Engine – an automated process designed to help Bitmex control the damage of market volatility – may have triggered a series of liquidations that sent prices back to ground.

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The March 12-13 plunge saw more than $1 billion liquidated on Bitmex, and the capital flight that followed saw 75,000 Bitcoin leave.

“It’s clear that the faith of merchants has been shaken,” whether retail or institutional, Carter said.

So these investors are fleeing to the dollar, as traders in other markets, except for digital currencies, are fleeing to the dollar-based cryptocurrency.

Carter has noted over $2 billion in stablecoin flows since the drop, i.e. a significant increase in the volume of Tether, the most popular stablecoin issuer.

Currently, the bitcoin price is up about 14 percent over the course of the week and is trading at $7,287.

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