Bitcoin transactions are rapidly declining as the cryptocurrency market continues to lose value following its recent peak.
The global crypto market lost $200 billion overnight into Tuesday morning, bringing the week’s losses to $300 billion. Since Bitcoin (BTC) reached a recent top in April, followed by an altcoin top in early May, momentum has pushed the global market value down. Following $1.1 trillion in losses since then, the prior quarter’s rise has been totally erased across the crypto market.
The recent slump also coincides with a marked decline in the number of transactions flowing through the Bitcoin blockchain. On May 30, the number of daily Bitcoin transactions dipped as low as 175,000 — a near three-year low that stretches back to September 2018, according to data from Bitinfocharts.
The number of Bitcoin transactions peaked at 392,000 in January 2021 and stayed relatively consistent until April 15 — two days after the coin’s price peaked. Since then, both have been declining, with transactions plummeting by more than 50% in May.
The same general pattern was witnessed with Ether (ETH), where daily transactions sank from 1.6 million on May 11 (the same day the coin price peaked), to 1 million by June 6 — a 37.5% decline.
The number of on-chain transactions for Bitcoin and Ether does not provide a complete picture due to the former’s use in the Lightning Network and the latter’s use by its own plethora of layer-2 protocols.
The dollar worth of coins trapped in the Lightning Network has also dropped significantly since reaching an all-time high of $76 million on April 14, down to $47 million at the time of publishing.
Market analysts, who make both hopeful and pessimistic projections for the future direction of the BTC coin price, are divided on whether the overall decrease will continue.