Bitcoin Hits $97K Amid Institutional Investment Surge
Key Takeaways
- Bitcoin has reached a new all-time high of USD 97,000.
- Despite the price surge, network activity remains notably low.
- Key on-chain metrics such as active addresses are stagnating.
- Reasons include institutional capital inflows, low volatility, and users migrating to other blockchains.
- The use of second-layer solutions like the Lightning Network is increasingly shifting transactions off the main network.
Price Surge Without Network Activity – What’s Behind It?
Bitcoin has seen a significant increase in value over the past few months, reaching a new high of USD 97,000. However, while the price climbs, activity on the Bitcoin network remains surprisingly weak. Key indicators such as the number of active addresses and transactions are not showing the same momentum.
According to data from CryptoQuant, the number of active addresses currently stands at around 958,000 – a figure that has rarely exceeded the 1 million mark in recent months. This raises questions: Why are so few using the network while the price is rising?
Six Reasons for Stagnating On-Chain Activity
1. Institutional Demand Dominates
The recent price increase is primarily driven by external capital inflows. Spot ETFs (Exchange Traded Funds) such as those from BlackRock or MicroStrategy are purchasing large amounts of BTC. These investments typically occur without direct use of the blockchain, distorting the picture of actual activity.
2. Low Volatility Slows Transactions
Bitcoin has recently been trading within a tight range between USD 92,000 and USD 95,000 for several weeks. Without significant price fluctuations, many investors lack the incentive to move their coins. This results in fewer transactions and lower on-chain activity.
3. Artificially Inflated Trading Volumes
Some exchanges report exaggerated trading volumes that are not accompanied by actual activity on the blockchain. This practice creates a distorted view of market movements, while real network usage remains low.
4. Migration to Other Blockchains
Many users are turning to alternative networks. Ethereum is heavily used for staking and DeFi (decentralized finance applications), Solana is leading in memecoins, and Base is attracting developers with low fees. The result: Bitcoin is losing relevance as a platform for everyday transactions.
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5. Decreased Practical Use as a Payment Method
Bitcoin is increasingly viewed as a store of value – similar to gold. Its use as a payment method or for microtransactions is fading into the background. This reduces everyday usage and, in turn, network load.
6. Second-Layer Solutions Relieve the Main Network
The Lightning Network offers a scalable solution for fast and affordable transactions. Many transactions now take place outside the main blockchain. This reduces visible activity on the mainnet, even though Bitcoin continues to be used.
What Does This Mean for You as an Investor?
A high Bitcoin price does not automatically mean the network is being used more. Currently, BTC is evolving more into a financial instrument for institutional investors rather than a decentralized currency for daily use. This could have long-term implications for the sustainability of the price increase.
Historically, a rise in network activity – especially from retail investors – has been crucial for sustainable price rallies. If this component is missing, the current price trend may face limitations.
Our Assessment
The Bitcoin price is currently benefiting significantly from institutional demand and new financial products such as spot ETFs. At the same time, network usage remains low. This suggests a shift in Bitcoin’s role – away from a payment method, toward an investment asset.
For you as a user or investor, this means: Don’t just watch the price – also pay attention to the network’s fundamentals. A healthy blockchain thrives on active usage. Without it, price gains may be short-lived.
Sources
- CryptoQuant
- Alphractal
| Symbol | BTC |
| Coin type | Alt Coin |
| Transaction Speed | Slow |
| Pros |
|
| Cons |
|
| Further practical applications | |
| Price | $94,701.00 |
| 24h % | -1.25 % |
| 7d % | 0.39 % |
| 30d % | 13.48 % |
| 60d % | 3.04 % |
| 1y % | 49.38 % |
| Market Cap | $1,881,482,498,473.00 |
| Max. Supply | 21,000,000.00 |
| Official Links | Website | Whitepaper | Source Code |
| Socials | Reddit | X | Message Board |
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