Julio Moreno, head of research at CryptoQuant, has noted that Bitcoin's mempool, a queue of pending transactions, is "practically empty."
Bitcoin's transaction activity has now plunged to its lowest level since last March.
Meanwhile, Bitcoin fees have now plunged to just 1 sat/vB.
Casa co-founder Jameson Lopp has stated that the empty mempool signals that the "sovereign usage" of the flagship cryptocurrency is "extremely low."
Some commentators have attributed the anemic activity to the "hodl" mentality that is pervasive within the community: Instead of spending their holdings, some users choose to stack sats to wait for price appreciation.
However, as Loop points out, it does not seem like the people who are buying Bitcoin are withdrawing to self-custody. He has explained that the total number of unspent transaction outputs (UTXOs) has been "dropping like a rock," which indicates that fewer coins are getting spread across individual wallets.
Even though some interpreted Bitcoin's anomaly low fees, Bart Mol, the founder and host of the "Satoshi Radio" podcast, has adopted a rather alarmist tone, arguing that the digital gold narrative is "slowly destroying the foundation of Bitcoin."
That said, Canadian Bitcoin developer Peter Todd believes that the low activity might be attributed to the growing popularity of the Bitcoin network. "Almost every transaction buying goods or services that I've done with Bitcoin in the past few years has been with Lightning. None of those show up in the blockchain," Todd said.
