- Bitcoin active addresses have fallen about 44% since May 2021
- New wallet creation is down roughly 43% from cycle highs
- ETF adoption reduces the need for direct on-chain participation
Bitcoin network activity has declined sharply from the levels seen during the 2021 bull market, according to new data from Santiment. Despite Bitcoin trading well above its previous cycle highs for much of the current market phase, user participation on-chain has not followed the same trend.
Bitcoin Network Activity Shows Sharp Drop From 2021 Levels
Bitcoin network activity averaged around 1.12 million active addresses per day during May 2021. At the same time, nearly 489,000 new wallets were created daily. Today, those figures have fallen to roughly 624,000 active addresses and 278,000 new wallets per day.
This represents declines of approximately 44% and 43%, respectively. Active addresses are commonly used to track unique participants sending or receiving transactions. Network growth measures the number of new addresses interacting with Bitcoin for the first time.
The data suggests that Bitcoin network activity is attracting fewer new participants than it did during the retail-driven market surge of 2021. Daily transactional usage has also moderated compared with previous cycle peaks.
Bitcoin Network Activity Reflects Changing Market Structure
One factor behind lower Bitcoin network activity may be the growing popularity of spot Bitcoin ETFs. These products allow investors to gain exposure to Bitcoin without creating wallets or moving assets on-chain.
As institutional participation expands, more capital can enter the market without directly affecting blockchain metrics. This creates a different market structure than the one observed during previous retail-led cycles.
Long-term holders may also be contributing to lower activity levels. Many investors are choosing to store Bitcoin rather than transact regularly. As a result, fewer addresses are actively moving coins across the network.
Santiment added that recent sideways price action may also be limiting engagement. Investor interest has increasingly shifted toward equities and precious metals in recent months. Until stronger price swings return, Bitcoin network activity may remain below the levels recorded during the peak of the 2021 bull market.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.
