The number of transactions waiting in the Bitcoin Mempool has been thin since mid-May, a rare occurrence in bull markets.
This prolonged spell of calm brought fees down to 1 SAT/VB or less, left many blocks unreasonable, and revived long-term concerns about the health of the Bitcoin fee market.
Some reports show that the 7-day average of confirmed daily transactions fell to 317,000 in early June, levels last seen in October 2023.
Low usage on Bitcoin at the grassroots level shows the struggle at the grassroots level.
A look at recent blocks shows how sparse activity has become. On June 9, several blocks contained fewer than 2,000 transactions and collected barely 0.01 to 0.03 BTC in total fees. Block 900451, mined by Mara Pool, contained just 12 transactions.
Other buildings from Foundry USA and VIOBTC accept transactions paying less than 1 SAT/VB, with some hovering around 0.01 BTC in fees. With the mempool constantly empty, miners are adding whatever they can to fill the space.
ScreenGrab showing Bitcoin blocks from Block 900446 to 900456 on June 9, 2025 (Source: Mempool)
The decline is not due to a technical issue or protocol update. It reflects broader market shifts that have reduced the urgency and volume of Bitcoin transactions on-chain. Notably, the macro environment has stabilized, Bitcoin volatility has cooled, and retail trading has largely faded from this bull market.
At the same time, a wave of institutional adoption and continued use of off-chain solutions like Lightning has pulled transaction volume away from the base layer.
Bitcoin remains hovering near its all-time high, trading steadily in the $100,000 to $110,000 range for weeks. However, the price action lacks the volatility spikes that often drive bursts of on-chain activity.
Lower volatility translates to fewer deposit and withdrawal events, fewer panic moves, and less arbitrage, all of which reduce pressure on block space.
Price stability hasn't sparked the kind of speculative rally that has typically occurred in previous cycles. Exchange volumes have evaporated, and daily active addresses are declining, suggesting that this rally is driven less by grassroots demand and more by institutional flows.
Bitcoin's Institutional Era
This shift is evident in Bitcoin ownership trends. Individuals held approximately 247,000 fewer BTC in early 2025 than they did a year earlier, while corporations, funds, and governments increased their holdings by approximately 225,000 BTC.
The emergence of meta-chain ETFs and corporate treasuries means that an increasing share of Bitcoin is in cold storage, not moving on-chain. Retail users who sold this BTC are off-chain, and entities that bought it are not making regular transactions. This transition, from millions of small holders to a few large custodians, has significantly reduced the number of UTXOS in circulation.
Efficiency gains across the Bitcoin economy reinforce this structural focus. Exchanges and custodians routinely combine hundreds of withdrawals into a single transaction. Many transactions reside on an internal ledger and never touch the blockchain.
Layer-2 solutions like the Lightning Network handle an increasing share of routine payments, especially in regions with high merchant traffic. All of these factors reduce reliance on layer-1 confirmations.
Development-related speculation faltered
The speculative activity that had previously filled the blockchain also faded. The hype surrounding orders and BRC-20 tokens in 2024 led to daily transaction counts approaching one million at their peak. Blocks were consistently filled, and fees soared above 100 SAT/VB. But that hype has faded.
The inscriptions and usage of the experimental token have declined sharply, and no new innovation has emerged to address them. The collapse of Memcoin mining and NFT traffic has removed a major pressure point from Mempool.
The result is a free market where little is paid. With no competition for block space, users pay a minimal, and sometimes even zero, fee to be included.
Transaction fees now represent only about 2% of miners' revenue. In mid-2014, at the height of speculative activity, this share often exceeded 10%. Without significant fee income, miners rely almost entirely on the 3.125 BTC block support.
This dependence raises long-term concerns. The next halving in 2028 will lower the support to 1.5625 BTC. If on-chain activity doesn't recover by then, fee revenue will need to make up the difference.
Otherwise, smaller or less efficient miners could be forced offline, which could impact hashrate, network security, and ultimately the performance of public mining companies.
Navigating low-fee environments
The current lull may be temporary, but it's already sparking a debate within the mining community about how to navigate low-fee environments.
Some miners have adapted by accepting low-volume or even non-standard transactions. One such service is the Marathon Slipsstream, which allows users to bypass the Mempool and submit unusual or large-volume transactions directly to miners.
While this practice is controversial, it demonstrates that miners are willing to fill blocks, but they can when demand decreases.
The low transaction volume also sparked a long-running debate about transaction migration policy. With blocks constantly shrinking and fees hovering at minimal levels, some miners began accepting transactions that would normally be ignored by the default Bitcoin core node configurations, such as those with extremely low fees, non-standard scripts, or unusual size ratios.
This behavior came under renewed scrutiny in early June after the Marathon Digiter mining pool included several such transactions using the Slipsstream pipeline, drawing criticism from some developers and users who viewed the move as enabling spam or compromising network reliability.
In response, 31 Bitcoin Core developers published a public statement reaffirming the importance of node-level transaction relay policies. The letter emphasized that the Bitcoin Core software does not dictate which miners should include which transactions, but instead sets a default for reasonable relaying to protect node operators from bandwidth abuse and resource overload.
The signatories warned against weakening these standards in the name of block filling, arguing that “filling blocks for the sake of filling” risks long-term harm to the network’s resilience and decentralization.
Community reaction has been divided, with some defending unauthorized mining and others advocating for stricter controls to prevent exploitation of low-lying conditions.
Currently, users benefit from a low overcapacity window. Chain consolidation, dust cleaning, and UTXO management are implemented at minimal cost.
However, developers and analysts are closely watching to see what will break the stagnation. A new speculative protocol, a geopolitical shock, or even a parabolic price breakout could quickly boost congestion. So far, none of these catalysts have emerged.
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