Bitcoin’s on-chain activity experiences a decrease, resulting in a slow movement of its price.
Bitcoin (BTC) network activity has reached a historic low, as traders have significantly reduced transactions since the cryptocurrency’s all-time high in price. Data from Santiment, a data analytics firm, reveals a decline in on-chain activity on the Bitcoin network over the past few months, providing a nuanced view of the current state of the cryptocurrency. Santiment’s update on May 11 highlights that on-chain activity on the Bitcoin network is at its lowest since 2019. This is evident from the decreasing transaction volume, daily active addresses, and whale transaction count. Bitcoin’s on-chain transaction volumes are nearing their lowest level in 10 years, while the number of daily active addresses is the lowest since January 2019. Whale transactions, which are typically worth more than $100,000, have also slowed significantly, similar to levels seen in December 2018.
Although the decline in on-chain activity may raise concerns, Santiment analysts suggest that it may not directly indicate impending price drops, as seen in recent weeks. Instead, they attribute the decline to “crowd fear and indecision” among traders, emphasizing the intricate relationship between on-chain activity and market sentiment. Despite these challenges, Bitcoin’s price remains relatively stable, hovering just above $61,000 with a slight 0.1% increase in the past day.
The coin’s 24-hour trading volume reached $12.67 billion, a decrease of more than 37% from the previous day. Over the past week, Bitcoin’s price has dropped by 4.6%, underperforming the global crypto market, which is down by 4.2%, according to data from CoinGecko. As investors navigate through this period of consolidation and subdued on-chain activity, market sentiment and broader economic factors are expected to play a crucial role in shaping Bitcoin’s trajectory in the coming weeks.
In other news, the Runes protocol on Bitcoin has generated $135 million in transaction fees on the cryptocurrency’s largest blockchain, according to a Dune Analytics dashboard. On-chain data reveals that tokens issued under the standard have generated more than 2,100 BTC costs within a week after the halving. However, activity has since slowed, with Friday, May 10 recording the lowest level of activity on the Runes protocol, as reported by The Block. Additionally, Bitcoin Magazine CEO has been appointed by Trump to draft the “day 1” crypto policy.
