According to Glassnode's research, on-chain consumption behavior suggests that some investors appear to have taken profits during the recent rally.
"We have yet to see a convincing influx of new users or demand," the report said. Specifically, bitcoin's user base currently lacks evidence of strong growth or recovery, with daily active users still at the upper end of a six-year bear market channel.
The number of transactions is relatively low, now close to 225,000 a day. While higher than last July, it is still far from what is common in bull market momentum. As a result, transaction fees have been near record lows since May last year, reflecting the lack of competition for block space among Bitcoin traders.
In theory, that would reduce the incentive to mine bitcoin, as miners make less profit per piece. Still, competition in the industry appears to be intensifying, with mining at an all-time high.
Each Bitcoin block now requires about 122.78 Zettahashes to solve. According to Glassnode, this equates to all 7.938 billion people on earth guessing a SHA256 hash 15.5 trillion times every 10 minutes to solve each Bitcoin block.