The number of active bitcoin addresses has rebounded to near-record highs, new data shows

El Salvador bitcoin

The number of active bitcoin addresses rebounded to near-record highs, driven partially by El Salvador’s passage of a law that makes it the first country to accept the digital currency as legal tender.

According to Glassnode data, on May 8 there were roughly 1.229 million active bitcoin addresses. That’s just under 15,000 addresses away from the January 8 all-time record of 1.243 million.

Glassnode chart bitcoin adresses 2

During the recent bitcoin sell-off, active bitcoin addresses fell dramatically, but now, as bitcoin’s price has stabilized, there’s been a resurgence in the number of active addresses on the network.

According to Glassnode, the rise in bitcoin addresses is a common “characteristic of bull markets” as the number of addresses rises when there is “strengthening demand for on-chain transactions, value settlement, and urgency for inclusion in an upcoming block.”

Bitcoin has been on a wild ride of late. The price of the digital asset reached an all-time high on April 15 of over $63,500 per coin before bearish news pulled the price down.

From Tesla’s u-turn on accepting bitcoin as a payment to concerns about the digital currency’s environmental impact, there was a flurry of bearish signals that hurt bitcoin.

Now though, the digital currency seems to have regained some of its previous luster after landing support at the soldout Bitcoin 2021 Miami conference and from El Salvador’s President Nayib Bukele.

Bukele sent a bill to El Salvador’s congress asking to make bitcoin legal tender in the country this week, and the bill was passed with a supermajority (62 out of 84 votes).

Nicholas Cawley from DailyFX told Insider that making Bitcoin legal tender “will help the remittances trade in El Salvador, for people sending money back to the country.”

The strategist said that “if this proves successful then the other big remittance markets including Mexico will be very interested onlookers.”

Read more: Forget bitcoin and other hypervolatile cryptocurrencies. For everyday transactions, the future of money is stablecoins.

Inflation concerns could also be helping bitcoin regain its prominence as digital assets are often viewed as a way to protect capital from inflationary pressures.

Google Trends data shows terms relating to inflation have seen skyrocketing search volume over the past month as market commentators continue to question whether current inflationary forces are truly “transitory” as the Fed describes.

Wharton professor Jeremy Siegel even said inflation could spike to 20% in the next few years in a recent interview with CNBC.

If inflation does spike and investors seek uncorrelated stores of value, bitcoin could end up gaining even more traction.

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A crypto lender is trying to claw back bitcoin after accidentally depositing hundreds of coins into user accounts

Bitcoin
Bitcoin.

  • BlockFi is trying to reverse course after accidentally depositing bitcoin into users’ accounts.
  • The crypto-lending start-up said fewer than 100 clients were incorrectly credited with cryptocurrency associated with a “promotional payout that did not belong to them.”
  • A screenshot on Twitter appears to show one user received 700 bitcoin from BlockFi by accident.
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Cryptocurrency-lending start-up BlockFi is trying to reverse course after mistakenly sending some of its users bitcoin as part of a promotion.

The company made incorrect promo payouts to certain customers. The company said on Reddit on Tuesday that fewer than 100 clients were incorrectly credited with cryptocurrency associated with a “promotional payout that did not belong to them,” and the situation will not affect BlockFi’s ongoing operations.

According to Bloomberg, a number of recipients withdrew the coins before the company could backpedal. BlockFi CEO Zac Prince said the firm’s exposure is around $10 million, but noted that’s decreasing as more users return the coins.

“BlockFi carries loss reserves as part of its accounting policies and this is a fraction of existing loss reserves – so no negative impact to equity or ongoing platform operations,” Prince told Bloomberg. “The issue that caused the withdrawals was fixed and incremental safeguards have been developed to prevent any similar issue in the future.”

On Friday, the company tweeted: “Some clients who participated in the March trading promotion may see an inaccurate bonus payment displayed in their transaction history. Our team is working on a fix and the proper amounts will be reflected shortly.”

Several users commented in the Tweet replies that they received deposits of bitcoin. One screenshot showed a deposit of 700 bitcoin on Friday. Another Reddit user said he found 30 bitcoins in his account. He said he checked to see if he could withdraw but the withdrawals and trades didn’t work.

Another Reddit user said they received an email from BlockFi accusing them of withdrawing funds and threatening legal action. The user said they were attempting to withdraw USDC which they had deposited a month earlier, unrelated to the promo payment.

BlockFi could not be immediately reached for comment.

Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100X trade opportunities – and shares 5 under-the-radar tokens he thinks could explode

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