IntoTheBlock Reveals Puzzling Fact About Current Bitcoin Situation
Bitcoin, the leading cryptocurrency, has a puzzling current situation that has left analysts scratching their heads. The market intelligence platform IntoTheBlock has shared intriguing insights into what's happening.
Bitcoin Adoption Has Slowed Down To Multi-Year Lows
Bitcoin had an impressive start in 2024, thanks to high demand from spot exchange-traded funds (ETFs) and institutional investors. This surge led Bitcoin to break its previous all-time high (ATH) and created much excitement. However, since reaching this peak, Bitcoin has mostly stayed the same in value.
High Transfer Activity But Low Adoption
In a recent post on X (formerly Twitter), IntoTheBlock discussed why many find the current Bitcoin situation confusing. They noted that the Number of Transactions on the BTC network has hit a new record. This increase is due to the Runes protocol, which lets users efficiently create fungible tokens on the network.
"Institutional whales are present, and activity on the Bitcoin network is high," said the analytics firm. "So, where’s the confusion?"
The New Addresses Metric Tells a Different Story
The confusion lies in the trend of the New Addresses indicator. This metric tracks the daily number of new addresses appearing on the network and provides insights into Bitcoin adoption.
Here’s a Look at the Data Over the Past Decade:
The data shows that while Bitcoin's price has risen to new heights, the number of new addresses has dropped significantly. IntoTheBlock points out that this surge in activity doesn't include many new participants. In fact, new Bitcoin users have fallen to levels lower than those seen even during the 2018 bear market.
Why This Matters
Typically, during bull markets, sharp increases in new investors drive asset adoption due to the hype. These new holders usually help fuel the rally. Yet, despite a new ATH, Bitcoin hasn't managed to attract a significant number of new users, causing confusion among analysts.
Current Bitcoin Price
At the time of writing, Bitcoin is trading at around $65,000, which is down 7% in the past week. This downturn and lack of new adoption may explain why Bitcoin hasn't continued its bullish momentum.
The big question now is whether this situation will change soon. Will Bitcoin manage to attract new users, or will the trend continue to decline? Only time will tell.
