• Bitcoin active addresses measure the daily total amount of Bitcoin addresses participating in transaction activity on the chain.
• After the bottom formed during the previous cycles, market activity rapidly changed and active addresses dropped to a relatively low level.
• Recently, some improvement has been registered in this metric following an increase in the price of Bitcoin, but not as significant as seen in other cycles.

What Are Active Addresses?

On-chain data shows demand for Bitcoin has been returning recently, but the rise has been slower than what previous cycles saw at a similar stage. As pointed out by an analyst in a CryptoQuant post, the market activity rapidly changed after the bottom formed during the previous cycles. The relevant indicator here is the “active addresses,” which measures the daily total amount of Bitcoin addresses that are participating in some transaction activity on the chain.

The metric only measures unique addresses, meaning that if an address takes part in multiple transfers in a single day, it’s still counted only once. The indicator also accounts for both senders and receivers in this measurement. When the value of this metric is high, it means a large number of addresses are making transactions on the network right now. Such a trend suggests that cryptocurrency is actively attracting users to trade on its chain currently. On the other hand, low values imply not many users are making transfers on blockchain at present time. This kind of trend can suggest that demand for asset is low currently.

Recent Trend In Active Addresses

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner? 570% up to 12 BTC + 300 Free Spins for new players & 1 BTC in bonuses every day, only at Wild.io. Play Now! A chart showing recent trend of Bitcoin active addresses looks like this: Looks like value of metric hasn’t moved much recently | Source: CryptoQuant
As shown from graph above, Bitcoin active addresses had come down to relatively low value during bear market; however recently some improvement has been registered with latest rally of price of bitcoin but rise still not too significant compared to past cycles when price rose sharply after falling off its peak .

What Does Low Value Of Active Addresses Suggest?

When value of this metric is low it implies that not many users are making transfers on blockchain at moment – suggesting demand for asset is little or none currently . Such situation often occurs during bear markets when price endlessly consolidates so investors don’t find bitcoin interesting enough to trade .

Why Is Demand Returning Recently?

Recently , some improvement has been registered with latest rally of price of bitcoin due which more users have started trading again . An example can be seen around time when FTX collapsed with sudden fall followed by sideways movement , leading to decrease again active addresses count .

Conclusion

The recent increase in active addresses suggests that people have become interested again in trading cryptocurrencies and demand may be returning slowly but surely . Nevertheless , there’s still room for growth before reaching same levels we used to see previously .