Active Addresses vs. Transaction Count
Bitcoin’s activity metrics have been showing a split recently. Active Addresses, which track unique addresses participating in transactions, have been plummeting. However, the Transaction Count, which measures the total number of transfers, has reached all-time highs.
Behind the Trend
This divergence is linked to the decline in Bitcoin Inscriptions. Inscriptions allowed users to store data on Bitcoin’s smallest unit, Sats. They were popular until mid-April, when their share of transactions dropped.
The Rise of Runes
The downfall of Inscriptions coincides with the rise of Runes, a protocol that allows users to create fungible tokens on Bitcoin. Runes use address reuse, meaning the same address can be involved in multiple transactions. This explains the increase in Transaction Count despite the decline in Active Addresses.
Current Bitcoin Price
As of writing, Bitcoin is trading at around $69,600, down over 2% in the past week.
