Recently, Bitcoin (BTC) daily transaction on its blockchain has increased to an all-time high of 682,000 on May 1st. Rafael Schultze-Kraft, one of the founders of Glassnode, suggested that the jump in transaction volume is likely because of the growing adoption of Bitcoin by institutional investors and big corporations. Companies now store it on their balance sheets and offer it as a payment option, adding to the demand for Bitcoin transactions. Similarly, the popularity of decentralized finance (DeFi) applications on top of blockchains like Ethereum and Bitcoin that enable users to borrow, lend, and trade cryptocurrencies have also driven the numbers up.

Furthermore, Schultze-Kraft claims that the increase in transaction counts is remarkable as it's two times more than the baseline established in 2022, which was around 250,000 transactions per day. With the newfound attention to the crypto space, more people are leaning into Bitcoin as a means of communication and expression as well.

A noteworthy aspect to this surge is the growth in Taproot transactions. Taproot is a proposed upgrade to the Bitcoin network that is expected to improve privacy and efficiency by combining multiple BTC script paths into a single output that can be spent with a single signature, making it smaller and cheaper. Taproot was proposed way back in 2018, however it took time for the Bitcoin community to align and achieve consensus on its implementation. As of April 30th, Taproot transactions accounted for 37.5% of spent outputs, and on May 1st, a high of 60% of all Bitcoin transactions adopted Taproot.

Interestingly, text inscriptions are at the heart of Taproot’s rising adoption. According to data from Glassnode, more than 50% of all transactions on the Bitcoin network were for text inscriptions, completely setting off all other kinds of inscriptions .This trend outpaced all other Bitcoin transactions for a brief period of time, suggesting that this is the main driving force behind the elevated transaction counts.

These evidences suggest that cryptocurrency, in general, is rising in popularity and is beginning to find widespread acceptance. Institutional investors, large corporations, and DeFi applications are fueling the demand for BTC transactions, and the recent surge in related activity is largely associated with the increase in the use of Taproot – spurred on by the increased usage of text inscriptions. As the use of blockchain technology grows, new innovations and upgrades will be introduced that will further benefit Bitcoin and its associated networks.



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