Despite Bitcoin trading well above its 2021 bull market highs for much of the current cycle, activity on the network tells a very different story.
New data from Santiment shows that both user participation and transaction activity remain significantly below the levels recorded during the peak of the last major bull run.
Network Usage Has Dropped Since 2021
At the height of the 2021 rally, Bitcoin averaged approximately 1.12 million active addresses per day, while nearly 489,000 new wallet addresses were being created daily.
Today, those numbers have fallen considerably. The network now records roughly 624,000 active addresses and about 278,000 new wallet creations each day.
Compared with the 2021 peak, active addresses have declined by around 44%, while the rate of new wallet creation has dropped by roughly 43%.
Active addresses are often used to gauge how many unique participants are using the network, while network growth measures the number of new addresses interacting with Bitcoin for the first time. Based on these metrics, Santiment concluded that Bitcoin is currently attracting fewer new users and generating less transactional activity than it did during the retail-driven boom several years ago.
Institutional Adoption Is Changing the Landscape
One of the main reasons for this disconnect may be the growing influence of institutional investment products.
According to Santiment, the rise of spot Bitcoin ETFs and other regulated investment vehicles has allowed investors to gain exposure to Bitcoin without directly interacting with the blockchain. As a result, many participants can invest in BTC without creating wallets or conducting on-chain transactions.
The firm also noted that long-term holders have become increasingly passive. Rather than actively moving their coins, many investors are simply storing Bitcoin for extended periods.
This shift has created a situation where Bitcoin’s market value remains high, but network activity is noticeably lower than during the retail-fueled rally of 2021.
Lower Activity Does Not Necessarily Signal Weakness
Santiment emphasized that declining network activity should not automatically be interpreted as a bearish development.
Historically, major price swings have tended to stimulate on-chain activity as traders move funds and react to market conditions. The current slowdown may instead reflect a period of relatively limited price movement, combined with increasing investor interest in traditional assets such as stocks and gold.
In other words, the decline in network usage may be more closely tied to changing investment behavior than to weakening confidence in Bitcoin itself.
Interest in Crypto Begins to Recover
Although on-chain activity remains subdued, investor attention toward cryptocurrencies has started to improve.
During May, discussions related to Bitcoin increased by approximately 24% compared with the previous month. According to Santiment, the rise in conversation suggests that traders are once again searching for opportunities in the digital asset market, even if capital deployment remains cautious.
The firm noted that participation is still selective, but overall interest appears to be returning after a quieter period.
Traditional Markets Continue to Compete for Attention
At the same time, many investors are increasingly focusing on opportunities outside the crypto sector.
Strong performances in technology, artificial intelligence, semiconductor, and defense stocks have attracted significant interest, encouraging traders to diversify their portfolios. Discussions surrounding equities and exchange-traded funds have also become more common within crypto communities.
This trend suggests that digital assets are now competing more directly with traditional investment sectors for investor attention and capital.
Regulation Remains a Key Market Focus
Regulatory developments also remained a major talking point throughout May.
Many market participants closely followed progress on the CLARITY Act, hoping it would provide long-awaited regulatory guidance for the cryptocurrency industry in the United States.
However, delays and procedural obstacles prevented the legislation from advancing before the end of the month, causing some of the initial optimism to fade and giving way to frustration among investors.
Strategy’s Bitcoin Sale Draws Attention
Another topic that generated significant discussion was the recent Bitcoin sale by Strategy.
The company disclosed the sale of 32 BTC, marking the first publicly reported Bitcoin sale in its history. The announcement sparked speculation about whether Strategy was reconsidering its long-standing commitment to holding Bitcoin indefinitely.
However, the transaction appears to have been related to managing obligations associated with preferred stock rather than signaling a change in the company’s overall Bitcoin strategy.
Even after the sale, Strategy remains one of the largest Bitcoin holders in the world, with approximately 843,706 BTC on its balance sheet.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
