On-chain data reveals a significant decline in Bitcoin's network activity, with key metrics falling more than 40% compared to their February 2021 peaks. According to analytics firm Santiment, the number of Daily Active Addresses has dropped 42% to approximately 650,000 per day, while Network Growth (new address creation) has declined 47% to around 291,000 daily addresses.
The trend shows a clear divergence from market capitalization performance. Santiment noted a "bearish divergence" throughout 2025 as Bitcoin explored fresh price highs while its underlying utility metrics declined. Both indicators witnessed a significant drop at the start of 2024, with only partial recovery during the subsequent bull rally, before slumping again in 2025 and moving sideways despite Bitcoin's price strength.
Additional data from Glassnode provides context to the market structure. At Bitcoin's current price around $67,000, unrealized losses equal approximately 19% of total market capitalization, a level of aggregate market pain that closely resembles the structure seen in May 2022. Historically, similar spikes in relative unrealized loss have coincided with capitulation phases or late-stage corrections within broader cycles.
Santiment's wallet cohort analysis reveals a divergence in holder behavior. Wallets holding 0.1–1 BTC have reached a 15-month high, accumulating roughly 1.05% more BTC since the October 5th all-time high, indicating consistent dip-buying among smaller participants. Conversely, wallets holding 1–10 BTC sit near a 38-month low, having reduced holdings by approximately 0.49% over the same period, suggesting mid-tier traders are taking profits or remaining cautious.
Analysts interpret this data as signaling market maturation rather than deterioration. The contraction in network activity aligns with a reduction in speculative churn and a transition toward longer-term holding behavior. Santiment suggests that a "true long-term relief rally" for crypto will depend on metrics like active addresses and network growth beginning to rise again. Currently, Bitcoin continues to trade sideways around the $66,400 level.
