Rune Protocol's slowdown in activity coincides with slump in Bitcoin on-chain activity

Brief overview:

• Bitcoin’s on-chain activity has dropped to its lowest level since 2019.

• This decline coincides with a decrease in Rune Protocol activity.

• Notably, two Satoshi Nakamoto-era Bitcoin addresses were activated today, May 12th.

The price of Bitcoin (BTC) has risen sharply at the start of the new year, successfully surpassing the $70,000 mark and generating significant interest and activity in its blockchain network.

However, recent developments suggest these indicators are showing signs of cooling. Over the past two months, the price of Bitcoin, the leading digital asset, has encountered headwinds and on-chain activity has declined.

Bitcoin on-chain activity plummets to 5 year low

Data from blockchain analytics firm Santiment shows that Bitcoin’s on-chain activity has reached its lowest point since 2019. The decline signals reduced interest among traders, in stark contrast to earlier enthusiasm.

The firm suggested the downturn may reflect broader sentiments of fear and uncertainty among market participants. This sentiment is consistent with historical patterns, as reductions in trading volume typically coincide with periods of market volatility. It is worth noting that as of press time, the price of BTC has fallen by more than 11% in the past month to $62,834.

“This is not necessarily a sign of further BTC losses, but rather a sign of fear and indecision among the crowd,” Santiment analysts wrote.

Bitcoin on-chain activity｜Source: Santiment

Meanwhile, some market observers noted that the decline in on-chain activity coincided with a slowdown in Rune Protocol transactions after an initial surge. The protocol launched on Bitcoin halving day, bringing record transaction fees and volume to the blockchain network. Despite a promising start, recent data suggests user engagement and transaction volume are declining significantly.

Crypto analyst Budhil Vyas pointed out that after Runes Protocol set a record of huge transaction fees of $135 million in its first week, in the past 12 days, only two days have exceeded $1 million in fees, especially The activity reached its lowest point on May 10.

Additionally, the enthusiasm surrounding spot Bitcoin exchange-traded funds (ETFs) appears to be fading. Data from CoinShares shows a significant slowdown in trading volume for spot Bitcoin ETFs. Over the past month, several funds have experienced outflows and days without inflows.

Amid a downturn in the ecosystem, two long-dormant Bitcoin addresses originating from the early days of Satoshi Nakamoto have recently become active again.

According to data from blockchain analytics platform Lookonchain, the wallets, after being idle for approximately 11 years, finally transferred all 1,000 BTC they held, which is currently worth a whopping $60.9 million. It is reported that these wallet addresses marked "16vRqA" and "1DUJuH" each received an initial deposit of 500 BTC in September 2013, when the value of Bitcoin was only $124.

Today, the asset value of these addresses has also grown significantly, with astronomical profit margins of nearly 50,000%.

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