Bitcoin (BTC) began 2024 with a powerful rally, surpassing $70,000 and experiencing significant activity on its blockchain network. However, recent trends indicate a cooling in these metrics.
On-Chain Activity at 5-Year Low
Data from blockchain analytics firm Santiment shows that Bitcoin's on-chain activity has reached its lowest level since 2019. This decline suggests a decrease in trader interest compared to the earlier enthusiasm. The firm suggests this slump may reflect broader fear and uncertainty among market participants, aligning with historical patterns where transaction decreases coincide with volatile periods. Notably, BTC's price has dropped over 11% in the past month to $61,205.
"This isn't necessarily a sign of more BTC dips, but rather a signal of crowd fear and indecision," according to Santiment analysts.
Runes Protocol Slowdown Mirrors On-Chain Slump
Some market observers point out that the dwindling on-chain activity coincides with the slowdown in Runes Protocol transactions after its initial surge. The protocol's launch on BTC halving day triggered record transaction fees and volumes. Despite this promising start, recent data suggests a noticeable decline in user engagement and transaction volumes.
Crypto analyst Budhil Vyas noted, "After Runes Protocol generated a staggering $135 million in fees the first week, only 2 out of the last 12 days exceeded $1 million – with May 10th seeing the lowest activity."
Spot Bitcoin ETF Enthusiasm Wanes
Furthermore, the excitement surrounding spot Bitcoin exchange-traded funds (ETFs) seems to be fading. CoinShares data reveals a slowdown in trading volume for spot Bitcoin ETFs. Over the past month, several funds have experienced outflows and days of no inflows.
Early Bitcoin Addresses Revive
Amidst the sluggishness in the ecosystem, two long-dormant Bitcoin addresses, originating from Satoshi Nakamoto's early days, recently sprung back to life.
According to blockchain analysis platform Lookonchain, these wallets, inactive for approximately 11 years, transferred their entire holdings of 1,000 BTC, currently valued at a staggering $60.9 million. The wallets, labeled "16vRqA" and "1DUJuH," had received initial deposits of 500 BTC each in September 2013 when Bitcoin was valued at a modest $124 per coin. Today, these addresses boast an astronomical profit margin of nearly 50,000%.
Read more: Latest Bitcoin Price Prediction
