Additional pressure is created by competition from other layer one networks — Ethereum, Solana, and Tron.
The number of active addresses in the Bitcoin network has decreased to nearly 600,000 — a figure from 2019, when a bearish trend was observed in the cryptocurrency market. Experts from Bitcoin Magazine suggested that there could be several reasons for such changes.
Bitcoin user activity has been declining for several years, despite the fact that the first cryptocurrency has become more accessible to investors through regulated products — primarily exchange-traded funds (ETFs) tracking Bitcoin.
Analysts note that the emergence of BTC-ETFs has given large stock market investors the opportunity to gain indirect access to cryptocurrency without having to purchase it directly on cryptocurrency exchanges. As a result, the need for direct transactions on the blockchain has decreased.
Additional pressure on Bitcoin is created by competition from other layer one networks — Ethereum, Solana, and Tron. Payments and settlements with stablecoins are increasingly taking place on these blockchains, while Bitcoin is still primarily perceived as a capital preservation tool.
Experts from Bitcoin Magazine also link the decline in Bitcoin network activity to the American GENIUS Act, which established rules for the issuance and circulation of stablecoins. After it came into effect last summer, large companies began to actively use stablecoins for fast and cheap payments.
Analysts estimate that Bitcoin user activity may remain low if capital continues to flow into stocks of companies related to artificial intelligence.
At the same time, the cryptocurrency exchange HTX halted trading on several trading pairs with tokens from the family of American President Donald Trump’s project, World Liberty Financial (WLFI). It all started when the World Liberty Financial team blocked addresses associated with the HTX exchange in the smart contract of the native token of the crypto platform. After that, the movement of WLFI tokens to these addresses on the blockchain became impossible. World Liberty Financial explained the decision by the sanctions imposed against the exchange.
In response, HTX suspended trading on the WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1 trading pairs. Additionally, the exchange blocked the deposit and withdrawal of USD1 and automatically converted all USD1 balances of its clients into USDT stablecoins at a rate of 1:1. Meanwhile, the native WLFI tokens remained on the on-chain addresses — the exchange promises to unlock them after the assets are unblocked by the World Liberty Financial team.
HTX also officially appealed to WLFI to lift the restrictions. HTX explained that the blocked assets belong to users who legally acquired the tokens. However, the exchange did not receive any clarifications from World Liberty Financial regarding the legal basis, frameworks, and procedures for the decision to freeze. USD1 is a stablecoin pegged to the dollar and traded, among others, on the world’s largest cryptocurrency exchange, Binance.
HTX was one of the first to support World Liberty Financial and launched the USD1 listing on May 6 of last year.
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