Bitcoin’s on-chain activity plunged into the red after the infamous LUNA crash. Undoubtedly, the crash reduced confidence in the cryptocurrency market and saw investors significantly reduce their activity in the space. This resulted in losses across the board for miners as fee revenue, transaction volume and transaction values all declined, and all saw their daily mining revenue fall toward annual lows.
Bitcoin activity down the chain
The past week saw an intensification of on-chain activity during the height of the LUNA hardware meltdown. Mostly, this was due to investors scrambling to move their currencies to avoid being affected by the downtrend that followed. In addition to the exchanges needing to restructure their bitcoin wallets after the massacre, which saw a spike in activity.
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As a result, there has been a huge jump in transaction volumes as well as the average transaction. Although this did not translate into more revenue for miners, recording 21.85% down from the previous week. Miners’ earnings were worse last week in the wake of the LUNA crash. It recorded an additional loss of 7.95% and daily revenue reached $25.5 million. The last time revenue was this low was in July of 2021.
Mining difficulty reaches all-time high | Source: Arcane Research
With the market stabilizing after the crash and the restructuring of the exchange portfolio, activity on the chain is now back to normal levels. This resulted in a 44% crash from the previous week, and daily trading volumes were down nearly 50% from last week’s levels.
Difficulty mining back up
Bitcoin mining difficulty has been declining over the past two weeks, seeing the block production rate exceeding the 6 blocks per hour target about three weeks ago. What followed was a mining difficulty correction that brought the mining difficulty back. The adjustment has seen block production drop below target sitting at 5.64 blocks per hour.
BTC declines below $30,000 once more | Source: BTCUSD on TradingView.com
Revenue made up of fees decreased 0.69% from the previous week to 1.81%. This was expected as the daily fee was down 33.48% in the same time period. Daily transactions decreased by 6.185 to 252532 daily transactions.
The bitcoin price has also taken a major hit which has contributed to a drop in daily mining revenue, along with a drop in the rate of block production that is now at an all-time high. Wednesday’s adjustment is expected to reduce mining difficulty by 4% and 5%. With this said, block production is expected to pick up and if the price of the digital asset reverses the move, miners could see a big jump in revenue this week.
Featured image from Seeking Alpha, charts from Arcane Research and TradingView.com
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