- Although BTC rallied to $97K, on-chain activity remained notably weak amid the price surge.
- Six key reasons explain why Bitcoin’s adoption and usage lag behind its recent price gains.
While Bitcoin [BTC] has experienced sustained gains on its price charts over the past months, its network has struggled.
Although Bitcoin has surged to $97,000, its on-chain activity remains relatively low.
Key network metrics, such as the number of Active Addresses and transactions, are surprisingly not reflecting the overall market enthusiasm.
In fact, the number of Active Addresses has struggled to remain above 1,000, reaching this level only three times in the past few months.
Source: CryptoQuant
At press time, Active Addresses hovered around 958.74K. This raises the question: Why is this happening?
According to Alphractal analysis, Bitcoin’s on-chain activity is struggling over 6 main reasons.
Six reasons behind Bitcoin’s stagnant on-chain activity
For starters, the current price is driven by external factors.
As such, the Bitcoin market and value are more influenced by capital inflows through Spot ETFs and institutional interest, and not by real blockchain usage. This is evidenced by the continued accumulation of MicroStrategy, Metaplanet, and BlackRock’s spot ETFs.
Secondly, BTC’s price volatility has been unusually low.
After weeks of consolidation between $92K and $95K, price action lacked the spark needed to trigger active wallet movement. In such conditions, many holders simply choose to wait.
Therefore, there are fewer incentives for investors to act, resulting in fewer on-chain transactions.
Thirdly, Bitcoin is experiencing artificial Exchange Volumes, where some Exchange Volumes are likely inflated. The inflated volume is creating a misleading sense of activity while real network usage stays modest.
Source: Alphractal
On top of that, usage has shifted elsewhere.
Other networks such as Ethereum [ETH], Solana [SOL], and Base are attracting DeFi, staking, and memecoin activity. Thus, speculative use is gradually moving to other chains where there’s high traffic.
For instance, the Solana chain has become dominant for memecoins, while Ethereum is staking. With usage moving to other chains, Bitcoin is struggling significantly.
Having said that, Bitcoin’s appeal as a practical payment network has also taken a backseat.
Thus, prices are growing faster than the network activity. Usually, this is unsustainable and prices might face a correction to meet the actual demand.
Finally, the adoption of second layers like Lightning Network is growing faster. With more transactions shifting off-chain, especially to Lightning, Mainnet activity appears lower.
This positions the crypto in a challenging situation where L2 is seeing more demand and usage. In conclusion, it’s essential to note that Bitcoin’s high price doesn’t necessarily mean increased blockchain usage.
Thus, we’re witnessing a shift where BTC is treated more like a financial asset, while on-chain dynamism is happening elsewhere.
What does this mean for BTC?
Ultimately, price alone doesn’t tell the full story. Bitcoin’s strong performance on the charts has not translated into increased network usage.
This shift suggests BTC is increasingly being treated as a macro financial asset—not as a decentralized currency built for everyday use.
Historically, network growth—especially from retail users—has played a crucial role in sustaining Bitcoin rallies. But now, with institutions dominating flows and retail largely on the sidelines, momentum may prove harder to maintain.
Unless on-chain demand picks up, BTC’s price growth could face structural limits.