Bitcoin [BTC] has seen significant adoption this year, particularly with the introduction of exchange-traded funds (ETFs) supporting its status as a valuable investment option.
Despite this success in the investment arena, BTC seems to be facing challenges in becoming a preferred choice for transactions.
The Lightning Network, a second layer protocol developed on the Bitcoin network to facilitate rapid, secure, and cost-effective transactions, has observed a decrease in activity, reverting back to 2021 levels.
Activity on the Lightning network
Statistics from Bitcoin Visuals indicate a sharp decline in Lightning Network Capacity, dropping from its peak of 5,308 BTC in July to 1,273 BTC.
A similar decrease can be seen in the number of nodes and channels, suggesting a notable reduction in user participation on the network.
This decline has sparked discussions within the BTC community, with Bitcoin enthusiast Sylvain Saurel pointing fingers at MicroStrategy’s Executive Chairman, Michael Saylor.
Saurel expressed,
“By continuously claiming that Bitcoin’s role as a [Means of Exchange] is insignificant, Michael J. Saylor has contributed to the waning interest in the Lightning Network.”
Nevertheless, the negative network trends have not overshadowed Bitcoin’s potential as a medium of exchange.
The state of Louisiana has permitted its residents to settle state-related charges using BTC through the Lightning Network.
In line with this initiative, Louisiana State Treasurer, John Fleming, emphasized their commitment to embracing technological advancements. Fleming remarked,
“By introducing cryptocurrency as a payment alternative, we are not only innovating but also offering our citizens flexibility and autonomy in utilizing state services.”
Simultaneously, former U.S. President and Republican Presidential candidate, Donald Trump, made history by executing a purchase using Bitcoin.
On September 18th, Trump bought cheeseburgers at a Bitcoin-themed PubKey bar in New York City using BTC.
Increasing Bitcoin monthly active addresses
The Bitcoin network is displaying resilience, as data from Artemis confirms a gradual uptick in monthly active addresses despite market volatility. The number of these active addresses has recently surpassed 10.7 million.
This surge in active addresses signifies healthy network expansion. However, a part of this growth may be attributed to heightened trading activities, as certain sectors show a decline in network usage.
CryptoSlam data reveals that Bitcoin ranks as the third-largest blockchain in terms of non-fungible token (NFT) sales volume, trailing Ethereum [ETH] and Solana [SOL].
Yet, NFT sales on the Bitcoin network have seen a 46% decrease in the last 30 days, totaling $55M. This downward trend is in line with the broader decline in NFT volumes across the sector.