In January 2024, Bitcoin saw a major increase in on-chain transaction volume, hitting a remarkable milestone for the cryptocurrency.
Data from The Block revealed that $1.21 trillion worth of Bitcoin was transferred on-chain during the month, marking the highest volume since September 2022, when Bitcoin’s price was around $20,000.
This surge in transaction volume follows a trend that has been gaining momentum over recent months. Throughout 2023, Bitcoin consistently fell short of reaching the $1 trillion volume mark each month, except for December. However, January’s record-breaking transaction volume signals a notable shift, indicating renewed activity in Bitcoin’s on-chain transactions.
Analysts attribute this surge in transaction volume to the anticipation surrounding the approval of spot Bitcoin exchange-traded funds (ETFs). Despite Bitcoin’s record-breaking low active supply, traders have been eagerly awaiting the approval of Bitcoin ETFs.
With the potential approval of these ETFs on the horizon, transaction volume has been steadily increasing. January marked the fourth consecutive month of volume growth after a comparatively modest $550 billion in volume moved in September 2023.
Interestingly, despite the rise in transaction volume, data from Glassnode analysts suggests that long-term Bitcoin holders remain steadfast in their commitment to the cryptocurrency. These holders seem unwilling to sell their coins, choosing instead to weather market fluctuations with a sense of calm resilience.
It’s worth noting that while transaction volume surged in January, monthly transactions on the Bitcoin network actually declined between December 2023 and January 2024, according to The Block’s data. This indicates a nuanced landscape of activity within the Bitcoin ecosystem, with underlying dynamics at play that warrant further investigation.