Bitcoin Active Address Ratio Hits Lowest Point Since 2010 Amid Market Consolidation

Bitcoin Active Address Ratio Hits Lowest Point Since 2010 Amid Market Consolidation

According to on-chain data from IntoTheBlock, the ratio of active Bitcoin addresses has dropped to its lowest level since November 2010. In June, the weekly active wallet ratio fell to a low of 1.22%, peaking at 1.32%—figures last seen in November 2010.

Additionally, the total number of active wallets has reached multi-year lows, with 614,770 active wallets recorded in the week of May 27, marking the lowest since December 2018. A declining active address ratio suggests a phase of market consolidation, indicating reduced buying and selling activity among Bitcoin holders.

Juan Pellicer, a senior researcher at IntoTheBlock, attributes this decrease in Bitcoin’s wallet activity rate to weaker retail participation compared to previous cycles. “This year’s surge to a new all-time high was driven by institutional capital rather than retail investors,” Pellicer told Cointelegraph. “The broader economic environment might have deterred retail investors from making as many crypto investments as in the past.”

The drop in activity rate coincides with investors preparing for increased whale movements, including the Mt. Gox trustee’s plan to start distributing payments to creditors in July. Some larger holders, including those linked to governments, have also been observed engaging in selling activities. Pellicer notes, “Due to this concentration, much of the bearish trading activity is conducted off-chain, which doesn’t significantly impact on-chain address activity statistics.”

Are Runes facing challenges?

This decline in activity might seem surprising given the launch of Runes, a fungible token protocol introduced to the Bitcoin ecosystem alongside the latest halving event in April. Runes was anticipated to provide an alternative revenue stream for miners, which it did initially as miners earned record-high trading fees on halving day. However, transaction fees have since returned to pre-halving levels, and miner reserves—the new Bitcoin held by miners—are at 14-year lows.

Pellicer informed Cointelegraph that activity on Runes has cooled, though he considers this a temporary lull due to the cyclical nature of such assets rather than a permanent decline. Meanwhile, recent interest in the crypto space has shifted towards memecoins and celebrity tokens, attracting speculators seeking larger gains. Although Bitcoin is known for its volatility, its current state appears stable compared to the lower cap memecoins.