• Bitcoin network activity is at its highest level since May 2021, as Ordinals NFTs have been rapidly gaining popularity.
• CryptoQuant’s Bitcoin Network Activity Index has seen a significant uptick in activity.
• The rise of NFT transactions on the network has caused the average block size to hit new all-time highs.
Bitcoin Network Activity Reaches Highest Level Since May 2021
On-chain data shows that Bitcoin network activity is now at its highest level since May 2021 as Ordinals NFTs have been rapidly gaining popularity.
CryptoQuant’s Bitcoin Network Activity Index
CryptoQuant’s “network activity index” evaluates the activity of the Bitcoin network using four metrics: total number of active addresses, number of transactions, Unspent Transaction Output (UTXO) count and block size. The value of the metric has seen a significant surge recently, reaching its highest level since May 2021.
Rise Of Non-Fungible Tokens (NFTs)
The boost in activity is attributed to the rise of BTC non-fungible tokens (NFTs), which have become possible on the BTC blockchain thanks to a system called “Ordinals.” This protocol directly stores images on the chain using Taproot transactions. As these NFTs are inscribed directly on the blockchain itself, it causes an increase in the average block size when added to transactions.
Network Activity Index
The Network Activity Index uses block size as one of its components for measuring activity; therefore, with increased block sizes, there has been a corresponding surge in this index.
Conclusion
In conclusion, Bitcoin network activity is currently at its highest point since May 2021 due to rapid growth in non-fungible token usage and CryptoQuant’s “Network Activity Index” reflecting this growth with an increase in value.