Bitcoin Blockchain Sees Decline in Transactions: A Sign of Stability or Challenges?
2025 saw a significant decline in transaction activity on the Bitcoin blockchain, in stark contrast to the previous year’s all-time high. With transaction volumes dwindling and transfer fees plummeting, the Bitcoin network is experiencing an unprecedented lull, raising questions about the long-term impact on miners and the security of the system.
Decline in Bitcoin Transaction Activity
Compared to the 2024 peak of 927,010 transactions processed in a single day in April, the 2025 peak so far is just 534,013 transactions on January 9. This downward trend continues over the months:
- October 2024: Average 660,682 transactions/day
- November 2024: 536,874 transactions/day
- December 2024: 413,021 transactions/day
- January 2025: 372,468 transactions/day
This situation becomes more evident in mid-February 2025, when Bitcoin blocks are processed irregularly. For example, block 883,885 is only three-quarters full and has only 921 pending transactions in the mempool—a sign of a sharp decline in network demand.
Transaction Fees Hit Rock Bottom
In parallel with the decline in transactions, transfer fees on the Bitcoin blockchain are also at very low levels. On February 15, the cost to prioritize a transaction was just 1 satoshi per virtual byte (sat/vB), or about $0.14—significantly lower than a year ago. This suggests that competition to include transactions in blocks has virtually evaporated, leading to a sharp drop in fee revenue for miners.
What’s Causing the Decline
A number of factors have contributed to the decline in Bitcoin transaction activity:
1. The Decline of Ordinals and Runes:
- Ordinals, which once sparked a wave of use cases for using Bitcoin to record NFT data, are losing traction. There are now about 85.68 million Ordinal inscriptions, but new minting has dropped sharply.
- The Runes protocol, which was once expected to revolutionize token creation on Bitcoin, has also failed to gain the popularity it was predicted to.
2. More conservative BTC holding behavior:
- Many investors are holding Bitcoin in wallets waiting for the price to increase, instead of making small transactions.
- Centralized exchanges are optimizing costs by consolidating payments into larger transactions, instead of multiple individual transactions.
3. BTC accumulation by ETFs:
- US-based Bitcoin ETFs have held over 1 million BTC since January 2024.
- The majority of these BTC remain in custodial wallets, significantly limiting circulation on the blockchain.
Impact on the Future of Bitcoin
The Bitcoin network is entering a period of adjustment, reflecting changes in user behavior and the development of use cases. Transaction consolidation and low fees may signal a period of stability, but also pose a major revenue challenge for miners.
Some experts believe that without a recovery in network usage—through DeFi applications, RWAs (real-world assets), or new transaction models—Bitcoin could continue to see low transaction rates, which could impact the security and sustainability of the network in the long term.
While the current trend may be temporary, the slowdown in the Bitcoin network is still something to watch closely, especially as the cryptocurrency market adjusts to new dynamics.
