CryptoQuant, a cryptocurrency analysis firm, has released a report detailing the decline in Bitcoin network activity and increasing uncertainty among investors. The data shows a decrease in active wallets and transactions for Bitcoin deposits and withdrawals, as well as a slowdown in the accumulation rate of Bitcoin spot ETFs. Additionally, there have been small capital outflows and a decline in the number of unspent transaction outputs (UTXOs), which could resemble the market correction seen in 2023. However, CryptoQuant cautions that a drop in UTXOs alone is not enough to confirm the end of the current bullish cycle, as other on-chain indicators suggest potential for continued upward momentum. The recent market rally was fueled by optimism surrounding US strategic asset allocation and pro-crypto policies under the Trump administration, but this enthusiasm has diminished due to a lack of immediate action and geopolitical tensions. The report suggests that new catalysts or resolution of existing uncertainties may be needed for the next uptrend in Bitcoin's price. Short-term price predictions based on historical data and on-chain metrics are challenging under current conditions. Improvement in macroeconomic conditions and a resurgence of Bitcoin's upward momentum could restore investor confidence, while prolonged uncertainty could lead to a prolonged consolidation phase.



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