The on-chain data indicates a significant decline in Bitcoin network activity, with daily transactions dropping by 53% from its peak in September 2024. The CryptoQuant Bitcoin Network Activity Index is at its lowest in a year, and overall network activity has decreased by 15% since November 2024. This decline could signal weakness in the cryptocurrency's fundamentals. The decline is attributed to macroeconomic factors, including the economic policies of US President Donald Trump and the fading hype around the Runes protocol. The introduction of tariffs by the Trump administration caused market shocks, leading investors to seek safer assets like the US dollar and avoiding volatile assets like Bitcoin. Additionally, the decline in interest in the Runes protocol, which had previously caused a spike in transactions on the Bitcoin network, has contributed to the decline. The near-empty mempool and overvaluation of BTC indicate that a correction may be due. However, BTC remains a potential hedge against inflation and economic uncertainty.



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