When the price of Bitcoin fell sharply four weeks ago (3 · 12), as investors started hoarding coins and turning to holding Bitcoin, Bitcoin network activity showed a downward trend. With the recent increase in the daily transaction volume of Bitcoin, Bitcoin transfer activity has started to heat up, and this trend is being reversed.
Bitcoin price recovery returns investors?
Glassnode released a chart on bitcoin network activity. The chart shows that the number of bitcoins moving across the network has accelerated rapidly since August last year and did not stabilize until last month. Now, this number increases again.
- Bitcoin developers release multi-signature UI to lower the threshold for full-node and hardware wallet users
- The market ushered in a counter-offensive yesterday, or did not have too strong continuity
- Bitcoin, which is also step by step: an alternative feast brought by the skyrocketing gold
- From lightning network shopping to bitcoin rebates, cryptocurrency payments have "invaded" mainstream platforms
- How to transfer bitcoin from one wallet to another
- Bitcoin scripts ushered in important upgrades, and Pieter Wuille officially announced the Miniscript project
Since the sharp decline in March, the overall network activity has also increased again, as shown in the following chart of Blockchain.info:
The main conclusion from this information is that this leading cryptocurrency is under development again. The change in activity on the network may be relatively small, but it still shows a shift from holding Bitcoin to using Bitcoin.
The increase in these network activities is likely due to the increase in transaction volume. There is no doubt that this will happen as prices increase. Many investors view the market recovery as an opportunity to quickly profit from the apparently growing demand for cryptocurrencies.
It is worth noting that the upcoming halving event also provided a strong impetus for buying Bitcoin immediately before the supply diminished in mid-May. Similarly, concerns about inflation and the continued slowdown of the global economy have driven many people to put their assets in safe havens, and Bitcoin and other cryptocurrencies are the most ideal choices.
Data shows network strength
Although the amount of activity on the Bitcoin platform fluctuates every month, it is worth noting that the Bitcoin network continues to operate as designed. The transaction fee is still very low, and the transaction confirmation time is relatively fast.
When there are about 400,000 transactions per day, the Bitcoin network will begin to show signs of congestion, a number that greatly exceeds the current number of transactions. The last time this happened was in 2017, resulting in slow transactions and high fees. Now, the Lightning Network exists to help prevent such problems from happening again, but more work needs to be done to make it reliable and user-friendly enough to be used by the public.
It can be reasonably assumed that with the adoption of the overall cryptocurrency, the number of active bitcoins will continue to increase. Activities in the entire blockchain field are accelerating, and most of these activities take place in areas such as decentralized finance and supply chain tracking. Current data clearly shows that interest in this new asset class continues to grow.