on the crypto
The number of Bitcoin on-chain transactions (quotation BTC) has dipped during the recent lull in the price of the cryptocurrency and this is hurting miners' earnings.
Bitcoin transactions at a minimum of the last 3 months
The world's largest cryptocurrency blockchain Bitcoin processed 231.437 transactions on October 18, the lowest since May 24, according to data provided by blockchain analytics firm Glassnode.
This means that the number of daily transactions has dropped by almost 40% from the peak of 382.408 recorded on July 1st. With far fewer transactions being processed online at the moment, the percentage of miners' revenue that comes from fees also dropped to a three-month low of 3,49% over the weekend.
Last week, bitcoin's hashrate hit a new high as mining on the network saw a record amount of computing power applied.
Low price volatility and bullish outlook
The decline in the number of transactions recorded is a result of the low-volatility trading of the cryptocurrency in recent times and could have bullish implications for the price, according to analysts.
"Boring price action and low volatility tend to reduce the number of transactions to and from exchanges," said Willy Woo, on-chain analyst and author of The Bitcoin Forecast newsletter.
On Sunday, the daily trading volume on major exchanges fell to $ 804 million. It's the low since July 19 and down 80% from the high of $ 4,4 billion recorded on September 3, according to data source Messari.
Exchanges typically liquidate bitcoins earned through commissions to pay salaries and finance other expenses. But with fewer transactions involving fewer fees, Woo said, the stock market supply tends to decrease, thereby reducing the selling pressure on the market.
The new milestone of $ 12.000
Bitcoin has now traded between $ 11.200 and $ 11.950 for more than a week, according to the industry's leading price indices. Previously, the cryptocurrency had stabilized below the $ 11.000 price threshold, where it remained for four weeks before setting a new full stop above the psychological limit of $ 11.000 on October 10.
Joel Kruger, currency strategist at LMAX Digital, also said the decline in transactions reflects sideways and directionless price action. The combination of low volatility and pullbacks in transaction counts often creates bullish conditions for prices, according to Woo.
As of press time, bitcoin is priced in the region of $ 11.950. A breakout would imply a resumption of the bitcoin price curve from the October 8 lows near $ 10.500 to aim for the new $ 12.000 milestone.
