The recent data on Bitcoin's circulation, as indicated by its velocity, suggests a notable shift in how the cryptocurrency is being used by its userbase. According to CryptoQuant founder Ki Young Ju, Bitcoin's circulation rate has dropped to historical lows, indicating that the tokens are remaining stationary in addresses for extended periods before being transferred.

The concept of "Velocity" in this context refers to the rate at which Bitcoin tokens are moving within the network. A higher velocity implies that coins are circulating more rapidly, while a lower velocity suggests that they are staying dormant in addresses for longer periods.

The chart provided illustrates that Bitcoin's velocity experienced a surge during the 2021 bull run, reaching a peak in the middle of the subsequent bear market in 2022. However, since then, the velocity has steadily declined and is now at its lowest point in approximately 13 years, reminiscent of circulation rates observed back in 2011.

This trend raises questions about the original vision of Bitcoin as electronic cash for peer-to-peer transactions without the need for central intermediaries. Instead, it appears that Bitcoin is primarily being treated as a store of value, often referred to as "Digital Gold," with institutions holding it as a long-term investment rather than using it for day-to-day transactions.

While it remains uncertain whether this low velocity trend will persist, historical data shows that Bitcoin's velocity has undergone cyclical fluctuations over its history. Ki Young Ju suggests that Bitcoin's velocity may peak again in the future when BTC becomes more widely adopted for payments, aligning with Satoshi Nakamoto's original vision of a peer-to-peer electronic cash system.