As traders and investors appear to be shifting funds towards altcoins, Bitcoin fees have dropped to their lowest level in a decade.

Key Takeaways

Bitcoin transaction fees have fallen to their lowest level in over a decade, reflecting weak demand. As Bitcoin holders diversify their assets, altcoins are attracting capital, but long-term investment confidence remains insufficient.

The price trend of Bitcoin [BTC] has recently shown weakening momentum. Glassnode data indicates that, on a 14-day average, Bitcoin's daily transaction fees have fallen to just 3.5 BTC.

The last time fees were this low was at the end of 2011, when the network was still in its early stages.

This decline indicates that on-chain market activity is shrinking, suggesting that demand for block space has significantly weakened over the past few weeks.

Evidence of portfolio diversification

Interestingly, according to CryptoQuant data from AMBCrypto, the number of active sending addresses has surged over the past 48 hours as transaction fees decline.

A surge in active sending addresses typically indicates that holders are moving coins out of wallets—usually to rebalance or to take positions elsewhere.

The timing looks perfect.

Most major altcoins have shown strong growth during the same period, further confirming the view that investors are moving funds out of Bitcoin in search of higher short-term returns.

Forex outflows bring change

Despite the on-chain developments mentioned above, Bitcoin also experienced a sharp increase in exchange outflows over the past week.

Analysts interpret this as a positive signal, as long-term holders are moving assets to self-custody. However, considering the increase in sending activity, the outlook becomes less clear.

Some of the outflow may still be directed towards altcoins rather than cold storage, reflecting a broader repositioning across the market.

What does this mean for Bitcoin?

In summary, BTC indicators suggest that the market is transforming.

Bitcoin seems to be losing some trading momentum, while altcoins have performed more strongly in the past 48 hours.

However, the outflow of funds from exchanges still suggests that long-term confidence in BTC has not disappeared.