Key Points
- Bitcoin active addresses have seen a decrease due to high transaction fees and the hype around Runes.
- The 7-day moving average of active Bitcoin addresses fell below 700,000 for the first time since March 2020.
The number of active addresses on the Bitcoin network has dropped significantly due to increased transaction fees and the excitement surrounding Runes. This decline was not unforeseen as high transaction costs can deter users from engaging with the blockchain.
High Fees and User Activity
When transaction fees become excessively high, as was the case with Runes, users who are unwilling to pay choose to hold back. Once the hype subsides and fees return to more manageable levels, users can resume their transactions.
However, this pattern has not been observed recently. Although the 7-day moving average fell to 689,810 on April 23, it saw a slight increase to 839,400 on April 30 as transaction fees eased. The 7-day moving average of the average transaction fee was $39.15 on April 23, dropping to $11.92 on April 30.
Current Trends
As of May 12, the moving average of active addresses has dropped further to 655,190. Conversely, the moving average of transaction fees has also decreased to $3.86, aligning with pre-halving levels. A similar pattern is observed with new addresses on the network, which generally follow the same trend as active addresses.
Despite the decrease in overall activity, Runes-related transactions still account for a significant portion of Bitcoin activity, often constituting more than half of daily transactions. The initial rush and the urgency to be the first to participate have subsided, allowing transaction fees to stabilize.
While high fees may have initially triggered the decline in active Bitcoin addresses, they no longer appear to be the main factor. Some users may still be waiting for further signs that the Runes hype has truly ended. The broader market slowdown could also be contributing to the decrease in active addresses.
