Bitcoin Network Activity In Bear Market Zone—Warning Or Opportunity?

By: bitcoin ethereum news|2025/05/07 08:15:01
0
Share
copy
On-chain data shows the Bitcoin network activity has recently declined into the bear market zone. Here’s what this could mean for the asset. CryptoQuant’s Bitcoin Network Activity Index Is Flashing A Bear Market Signal As pointed out by an analyst in a CryptoQuant Quicktake post, the Bitcoin Network Activity Index has recently been inside the bear phase. The “Network Activity Index” here refers to an indicator from CryptoQuant that essentially tracks the amount of activity that the BTC network is witnessing. The metric uses the data of different activity-related indicators like the transaction count and daily active addresses in order to determine the situation on the blockchain. Here is the chart shared by the quant that shows the trend in the index and its various moving averages (MAs) over the cryptocurrency’s history: As displayed in the above graph, the Bitcoin Network Activity Index reached a peak last year, but since December, the metric has been sharply moving down, implying the demand for using the network has been waning. Generally, a surge in user activity is what provides the fuel that any move in the asset’s price needs to be sustainable, so an increase in the Network Activity Index may be considered constructive, while a decrease a bad sign. Recently, the trend in the network activity has developed in such a manner that the index has entered into what’s considered as a “bear phase.” From the chart, it’s visible that this red signal has maintained even after the latest recovery rally. The signal has historically come alongside bear markets for Bitcoin (arriving before the price low is in), but there was one notable exception: the second half of the bull run in 2021. The Network Activity Index signaled a bear phase during this rally, which suggests that, from the perspective of chain usage, this run was always unlikely to last. This may be one of the reasons why the price couldn’t reach a much higher top than the May 2021 one during this bull run. Nonetheless, Bitcoin was still able to witness a notable period of bullish momentum back then despite the Network Activity Index signal. Thus, while the latest red signal from the metric can indicate the presence of a bear market, it could also just be a signal for a buying opportunity. In some other news, the combined market cap of the stablecoins has just reached a new all-time high (ATH), as the market intelligence platform IntoTheBlock has shared in an X post. The capital stored in the form of stablecoins may find its way into other cryptocurrencies like Bitcoin, so a rise in their market cap might be looked at as a bullish sign for the sector as a whole. BTC Price At the time of writing, Bitcoin is trading around $93,800, down around 1% in the last week. Source: https://www.newsbtc.com/bitcoin-news/bitcoin-activity-bear-warning-opportunity/

You may also like

TAO is Elon Musk, who invested in OpenAI, and Subnet is Sam Altman

Most of the capital invested in TAO will ultimately subsidize development activities that do not provide value back to token holders.

The era of "mass coin distribution" on public chains comes to an end

The market is becoming increasingly intelligent, and they are abandoning ecosystems that rely solely on funding to support false activity. Now, what is being rewarded is real throughput, real users, and real revenue.

Soaring 50 times, with an FDV exceeding 10 billion USD, why RaveDAO?

What exactly is RaveDAO? Why is Rave able to rise so much?

1 billion DOTs were minted out of thin air, but the hacker only made 230,000 dollars

Liquidity saved Polkadot's life.

After the blockade of the Strait of Hormuz, when will the war end?

The US has taken away Iran’s most important card, but has also lost the path to ending the war

Before using Musk's "Western WeChat" X Chat, you need to understand these three questions

The X Chat will be available for download on the App Store this Friday. The media has already covered the feature list, including self-destructing messages, screenshot prevention, 481-person group chats, Grok integration, and registration without a phone number, positioning it as the "Western WeChat." However, there are three questions that have hardly been addressed in any reports.


There is a sentence on X's official help page that is still hanging there: "If malicious insiders or X itself cause encrypted conversations to be exposed through legal processes, both the sender and receiver will be completely unaware."


Question One: Is this encryption the same as Signal's encryption?


No. The difference lies in where the keys are stored.


In Signal's end-to-end encryption, the keys never leave your device. X, the court, or any external party does not hold your keys. Signal's servers have nothing to decrypt your messages; even if they were subpoenaed, they could only provide registration timestamps and last connection times, as evidenced by past subpoena records.


X Chat uses the Juicebox protocol. This solution divides the key into three parts, each stored on three servers operated by X. When recovering the key with a PIN code, the system retrieves these three shards from X's servers and recombines them. No matter how complex the PIN code is, X is the actual custodian of the key, not the user.


This is the technical background of the "help page sentence": because the key is on X's servers, X has the ability to respond to legal processes without the user's knowledge. Signal does not have this capability, not because of policy, but because it simply does not have the key.


The following illustration compares the security mechanisms of Signal, WhatsApp, Telegram, and X Chat along six dimensions. X Chat is the only one of the four where the platform holds the key and the only one without Forward Secrecy.


The significance of Forward Secrecy is that even if a key is compromised at a certain point in time, historical messages cannot be decrypted because each message has a unique key. Signal's Double Ratchet protocol automatically updates the key after each message, a mechanism lacking in X Chat.


After analyzing the X Chat architecture in June 2025, Johns Hopkins University cryptology professor Matthew Green commented, "If we judge XChat as an end-to-end encryption scheme, this seems like a pretty game-over type of vulnerability." He later added, "I would not trust this any more than I trust current unencrypted DMs."


From a September 2025 TechCrunch report to being live in April 2026, this architecture saw no changes.


In a February 9, 2026 tweet, Musk pledged to undergo rigorous security tests of X Chat before its launch on X Chat and to open source all the code.



As of the April 17 launch date, no independent third-party audit has been completed, there is no official code repository on GitHub, the App Store's privacy label reveals X Chat collects five or more categories of data including location, contact info, and search history, directly contradicting the marketing claim of "No Ads, No Trackers."


Issue 2: Does Grok know what you're messaging in private?


Not continuous monitoring, but a clear access point.


For every message on X Chat, users can long-press and select "Ask Grok." When this button is clicked, the message is delivered to Grok in plaintext, transitioning from encrypted to unencrypted at this stage.


This design is not a vulnerability but a feature. However, X Chat's privacy policy does not state whether this plaintext data will be used for Grok's model training or if Grok will store this conversation content. By actively clicking "Ask Grok," users are voluntarily removing the encryption protection of that message.


There is also a structural issue: How quickly will this button shift from an "optional feature" to a "default habit"? The higher the quality of Grok's replies, the more frequently users will rely on it, leading to an increase in the proportion of messages flowing out of encryption protection. The actual encryption strength of X Chat, in the long run, depends not only on the design of the Juicebox protocol but also on the frequency of user clicks on "Ask Grok."


Issue 3: Why is there no Android version?


X Chat's initial release only supports iOS, with the Android version simply stating "coming soon" without a timeline.


In the global smartphone market, Android holds about 73%, while iOS holds about 27% (IDC/Statista, 2025). Of WhatsApp's 3.14 billion monthly active users, 73% are on Android (according to Demand Sage). In India, WhatsApp covers 854 million users, with over 95% Android penetration. In Brazil, there are 148 million users, with 81% on Android, and in Indonesia, there are 112 million users, with 87% on Android.



WhatsApp's dominance in the global communication market is built on Android. Signal, with a monthly active user base of around 85 million, also relies mainly on privacy-conscious users in Android-dominant countries.


X Chat circumvented this battlefield, with two possible interpretations. One is technical debt; X Chat is built with Rust, and achieving cross-platform support is not easy, so prioritizing iOS may be an engineering constraint. The other is a strategic choice; with iOS holding a market share of nearly 55% in the U.S., X's core user base being in the U.S., prioritizing iOS means focusing on their core user base rather than engaging in direct competition with Android-dominated emerging markets and WhatsApp.


These two interpretations are not mutually exclusive, leading to the same result: X Chat's debut saw it willingly forfeit 73% of the global smartphone user base.


Elon Musk's "Super App"


This matter has been described by some: X Chat, along with X Money and Grok, forms a trifecta creating a closed-loop data system parallel to the existing infrastructure, similar in concept to the WeChat ecosystem. This assessment is not new, but with X Chat's launch, it's worth revisiting the schematic.



X Chat generates communication metadata, including information on who is talking to whom, for how long, and how frequently. This data flows into X's identity system. Part of the message content goes through the Ask Grok feature and enters Grok's processing chain. Financial transactions are handled by X Money: external public testing was completed in March, opening to the public in April, enabling fiat peer-to-peer transfers via Visa Direct. A senior Fireblocks executive confirmed plans for cryptocurrency payments to go live by the end of the year, holding money transmitter licenses in over 40 U.S. states currently.


Every WeChat feature operates within China's regulatory framework. Musk's system operates within Western regulatory frameworks, but he also serves as the head of the Department of Government Efficiency (DOGE). This is not a WeChat replica; it is a reenactment of the same logic under different political conditions.


The difference is that WeChat has never explicitly claimed to be "end-to-end encrypted" on its main interface, whereas X Chat does. "End-to-end encryption" in user perception means that no one, not even the platform, can see your messages. X Chat's architectural design does not meet this user expectation, but it uses this term.


X Chat consolidates the three data lines of "who this person is, who they are talking to, and where their money comes from and goes to" in one company's hands.


The help page sentence has never been just technical instructions.


Popular coins

Latest Crypto News

Read more