In previous cryptocurrency bull market cycles, on-chain activity often played the role of a 'weather vane.' This indicator represents whether Bitcoin that has not moved for a long time is being reintroduced into market circulation—an increase means active old coins and increased potential selling pressure; conversely, it means that these Bitcoins are still in a 'dormant' state.
Now, this indicator has been processed through 'entity adjustment' to remove internal transfers between addresses of the same entity, making the data it reflects closer to the real on-chain economic behavior.
(Figure 1)
From the chart, we observe that the price increases of Bitcoin in March and November 2024 are distinctly different from the price increase in April 2025. During the first two waves of increases, on-chain activity rose simultaneously, indicating that a large number of old coins were realizing profits and were fully absorbed by new incoming capital, forming a typical bull market chip replacement pattern.
The new upward trend since April 2025, however, presents a different picture. Although the price of Bitcoin rapidly rose from $745,000 to $1,119,000, on-chain activity remained flat or slightly declined. This low turnover and low liquidity market means that this round of increases is more driven by limited selling pressure and marginal demand, rather than strong capital relay.
(Figure 2)
From a positive perspective, the inactivity of old coins can be understood as a strong reluctance to sell among holders. In the short term, in the absence of significant negative stimuli, the risk of price decline is relatively controlled, and the market is likely to maintain a fluctuating pattern.
However, such low activity levels may also indicate that market demand has not yet been fully released, and capital follow-up is insufficient. If prices continue to rise but lack supporting momentum, it may replay the scenario of the second peak after July 2021—when declining on-chain activity made it difficult for the market to maintain high positions, ultimately initiating a long-term downtrend.
The performance of this atypical bull market breaks our previous inertia regarding the 'main upward wave.' It not only causes divergent interpretations in the market but also raises higher demands for analysis—perhaps in the future we need to adapt to more diversified bull market forms and capital behavior paths.
