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Bitcoin Active Addresses Decline, Investors Losing Interest?

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On-chain data shows the Bitcoin active addresses metric has been decreasing recently, a sign that investors may be losing interest in BTC.

Bitcoin Active Addresses Have Taken A Hit Recently

As an analyst on X pointed out, the active addresses metric may signal that the network activity has dropped recently. The “daily active addresses” is an indicator that measures the total number of addresses taking part in some transaction activity on the blockchain daily.

This metric naturally counts both the senders and receivers. It only accounts for unique addresses, meaning that even if a wallet makes several transactions in a single day, its contribution towards the indicator’s value will remain one unit.

The number of active addresses on the network may be considered analogous to the total number of unique users visiting the blockchain, so this indicator can tell us about the amount of traffic the Bitcoin network is receiving.

When this metric’s value is high, many addresses are making transfers on the chain right now. This trend can be a sign that the users are currently finding the network attractive.

On the other hand, low values of the indicator imply low usage of the chain, which may indicate that the interest in the cryptocurrency is low among the general investor.

Now, here is a chart that shows the trend in the daily Bitcoin active addresses over the last few years:

Looks like the value of the metric has been declining in recent days | Source: @ali_charts on Twitter

As displayed in the above graph, the Bitcoin daily active addresses surged when the rally above the $30,000 mark occurred. Generally, investors get FOMO’d into the asset whenever such sharp price action happens, so the blockchain activity naturally shoots up.

The excitement of the rally could only last for so long, however, as the indicator had hit a top after a while when investors had started getting b

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Author: Hououin Kyouma

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