VanEck May 2024 Bitcoin ChainCheck
31 May 2024
Read Time 5 MIN
Please note that VanEck has exposure to bitcoin.
In our May 2024 Bitcoin ChainCheck, we dive deeper into the shifts within the Bitcoin ecosystem following the recent halving event. This month's analysis observes a major pullback in inscriptions (-79%) and Bitcoin mining revenues (-49%). In response to the tougher operating environment, the network’s total hash rate fell 4% in the month, and Bitcoin mining equities fell 9%. Such challenges are leading many miners to either explore AI applications or M&A to achieve diversification or more scale.
- Bitcoin’s Price Action
- Bitcoin’s Network Activity, Adoption, and Fees
- Bitcoin Market Health and Profitability
- Bitcoin Miners
- Bitcoin ChainCheck Monthly Dashboard
Some takeaways for May 2024:
Bitcoin’s Price Action
- Market sentiment: Bitcoin prices displayed a slight decline of 2% over the last 30 days, currently standing at $64,815. Despite this minor setback, BTC is still up 136% y/y.
- Regional trading: Post-halving adjustments and ETF availability have brought distinct changes in regional market behaviors, with Bitcoin exhibiting clear relative strength during U.S. trading hours.
| MoM Change (%) | YoY Change (%) | |
| Asia Hours Price Change MoM ($) | -4 | 8 |
| U.S. hours Price Change | 4 | 82 |
| EU hours Price Change | -2 | 41 |
Source: Glassnode, as of 5/28/24. Past performance is no guarantee of future results.
- Funding rates: The annualized cost on Bitcoin Futures saw a significant reduction to 10%, possibly indicating decreased speculation or lower bullish sentiment in the market.
Bitcoin’s Network Activity, Adoption, and Fees
- Daily transactions: There has been a notable increase of 20% this month in transactions, likely due to ongoing re-adjustments post-halving. Such activity is in the 98th percentile of activity.
- Ordinal inscriptions: A steep 79% reduction in daily inscriptions has occurred, suggesting a strong market shift away from these assets.
- Total transfer volume: Total transfer value across the network decreased by 13% to $44.60 billion, albeit still maintaining robust activity metrics in the 85th percentile of all-time history.
- Average transaction fees: Fees experienced a dramatic downturn of 78%, averaging $3.68, which points to decreased network congestion as inscriptions have dwindled.
Bitcoin Market Health and Profitability
- Percent of addresses in profit: A slight drop was noted, with 93% of addresses remaining in profit. As we have noted, when this number reaches 100% after a multi-year gap, as it did in January, Bitcoin tends to make repeated all-time highs in the subsequent year.
- Net unrealized profit/loss: This ratio decreased to 0.56, interpreting a cautious yet not overly pessimistic sentiment.
Bitcoin Miners
- Total daily BTC miner revenues: Miners faced a sharp revenue drop of 49% to $30.83 million, reflecting the impacts of lower transaction fees and mining rewards post-halving. We have noticed some recent M&A among Bitcoin miners, with U.S.-listed RIOT making a bid for Canadian Bitfarms (BITF) after accumulating a 10% stake in the open market, which follows the closing of Hut8 Mining’s purchase of US Bitcoin late last year.
Chart of the Month: BTC 30-Day Average Fees (USD)
Source: Glassnode, VanEck research as of 5/28/24. Past performance is no guarantee of future results.
| Bitcoin ChainCheck Monthly Dashboard as of May 28th, 2024 | ||||
| 30-day avg | 30 day change (%) | 365 day change (%) | Last 30 days Percentile vs all-time history (%) |
|
| Bitcoin Price | $64,815 | -2 | 136 | 99 |
| Daily Active Addresses | 687,147 | -16 | -18 | 62 |
| Daily New Addresses | 282,394 | -21 | -30 | 54 |
| Daily Transactions | 571,778 | 20 | 8 | 98 |
| Daily Inscriptions | 8,359 | -79 | -97 | 16 |
| Total Transfer Volume (USD) | $44,602,891,094 | -13 | 105 | 85 |
| % Supply Active, last 180 days | 24% | 3 | 21 | 29 |
| % Supply Active, last 3+ years | 46% | 2 | 16 | 100 |
| Avg Fees (USD) | $3.68 | -78 | -51 | 83 |
| Avg Fees (BTC) | 0.00006 | -78 | -79 | 17 |
| Percent of BTC Addresses in profit | 93% | -1 | 37 | 79 |
| Unrealized profit/loss ratio | 0.56 | -3 | 94 | 77 |
| Global Power Consumption (TWh) | 117 | -3 | 69 | 99 |
| Total Daily BTC Miner Revenues (USD) | $30,832,877 | -49 | 4 | 85 |
| Total Crypto Equities' Market Cap (USD) (MM) | $141,047 | -9 | 164 | 91 |
| Transfer volume from Miners to Exchanges (USD) | $2,289,134 | -44 | -42 | 67 |
| Bitcoin Dominance | 53% | 0.38 | 15 | 78 |
| Bitcoin Futures Annualized Basis | 10% | -28 | 270 | 66 |
Source: Glassnode, VanEck research as of 5/28/24. Past performance is no guarantee of future results.
Notes:
Net unrealized profit/loss ratio (NUPL) can be calculated by subtracting the realized market cap from the market cap and dividing the result by the market cap. When a high percentage of Bitcoin’s market cap consists of unrealized profits, it can be interpreted that investors are greedy. Background reading here.
Links to third party websites are provided as a convenience and the inclusion of such links does not imply any endorsement, approval, investigation, verification or monitoring by us of any content or information contained within or accessible from the linked sites. By clicking on the link to a non-VanEck webpage, you acknowledge that you are entering a third-party website subject to its own terms and conditions. VanEck disclaims responsibility for content, legality of access or suitability of the third-party websites.