Bitcoin activity has plummeted to its lowest levels in over a decade, driven by a decline in retail participation and a shift in investor focus towards memecoins. According to on-chain data from IntoTheBlock, the ratio of active Bitcoin addresses fell to a mere 1.22% in June, hitting its lowest point since November 2010. This drop is further evidenced by the total number of active wallets, which reached a multiyear low of 614,770 in late May, the lowest since December 2018.

The decreased activity in Bitcoin wallets suggests a phase of market consolidation, with less buying and selling among Bitcoin holders. Juan Pellicer, a senior researcher at IntoTheBlock, attributes this drop to weaker retail participation compared to previous cycles. Pellicer noted that this year’s rally to new all-time highs was largely driven by institutional capital rather than retail investors. He pointed out that the broader economic situation might have deterred retail investors from making as many crypto investments as in the past.

The reduction in retail activity coincides with rising movements among Bitcoin whales. Significant events include the Mt. Gox trustee planning to start distributing payments to creditors in July. Additionally, some large holders, including those associated with government activities, have been spotted selling Bitcoin. Pellicer explained that much of the bearish trading activity is occurring off-chain, which does not significantly impact on-chain address activity statistics.

The drop in Bitcoin activity appears counterintuitive given the recent launch of Runes, a fungible token protocol introduced to the Bitcoin ecosystem alongside the latest halving event in April. Initially, Runes provided an alternative revenue stream for miners, resulting in record-high trading fees on halving day. However, transaction fees have since normalized, and miner reserves—new Bitcoin held by miners—are at 14-year lows. Pellicer remarked that activity on Runes has cooled off, suggesting a temporary lull rather than a permanent decline due to the cyclical nature of such assets.

Amid the downturn in Bitcoin activity, attention has shifted towards memecoins and celebrity tokens, which are attracting speculators seeking larger gains. While Bitcoin is known for its volatility, its current state appears relatively stable compared to the wild fluctuations seen in lower-cap memecoins. This shift indicates that speculators are drawn to the high-risk, high-reward nature of memecoins, further diverting activity away from more established cryptocurrencies like Bitcoin.

Bitcoin’s significant drop in wallet activity to levels not seen since 2010 underscores a period of market consolidation influenced by reduced retail participation and the allure of memecoins. While institutional investors continue to play a significant role, the broader economic environment and the appeal of speculative assets have reshaped the landscape of crypto investments. As the market evolves, it remains to be seen how Bitcoin will navigate these changes and whether retail interest will reignite in the face of emerging trends.