Bitcoin’s price has recently made an early new high this cycle, surpassing previous peaks ahead of the anticipated halving. This surge is primarily driven by institutional demand, presenting a seemingly promising outlook for the cryptocurrency. Earlier this year, *BTC* transactions surged, hitting new highs amid the hype surrounding ordinals and Runes. This increase in activity further suggests a robust and growing interest in Bitcoin.
Institutional whales are significantly present, and activity on the Bitcoin network is high. These factors generally indicate a strong market and bullish sentiment. However, the situation is not as straightforward as it appears. Despite the positive indicators, many analysts are puzzled by Bitcoin’s current situation. The confusion arises from a critical piece of data: the surge in usage and whale activity does not involve a significant influx of new participants.
Decline in New Bitcoin Users
The number of new Bitcoin users has plummeted to a multi-year low, even falling below the levels seen during the 2018 bear market. This decline is concerning, as new user growth is typically a key driver of crypto bull markets.
The current lack of retail user growth poses a critical question: Why are retail investors not loading up on Bitcoin? Typically, widespread Bitcoin enthusiasm among retail investors fuels crypto bull markets. Despite Bitcoin’s early rise this cycle, the absence of retail participation is a significant anomaly that analysts are struggling to understand.
Bitcoin’s early price surge and increased network activity, driven by institutional demand, paint a promising picture. However, the decline in new user growth and lack of retail investor enthusiasm present a critical puzzle for analysts, leaving the future trajectory of Bitcoin uncertain.
