Study: Bitcoin daily transactions fell from ~360K in late 2017 to ~230K in Sept. 2018; transaction values fell from $3.7B+ to below $670M in the same period
- Declining daily transaction volume, values seen as negative — Quarter-over-quarter transactions are seen plummeting again
Context & Ripple Effects
The study lands as a confirmation of what Chainalysis already showed for payment processors: the 17 largest crypto processing services saw inflows collapse from $412M in September 2017 to $69M by June 2018. Now the network-level numbers match — daily transactions down from ~360K to ~230K, and value moved down from over $3.7B to below $670M.
The decline isn't confined to Bitcoin itself. Chainalysis found Bitcoin Cash payments — pitched explicitly as the cheaper payments chain — fell from $10.5M in March to $3.7M in May, meaning the entire 'crypto as payments' thesis was contracting at once, not just the largest chain.
First-order effects
- Crypto payment processors lose their revenue base almost entirely within a year — the same Chainalysis cohort that received $412M in September 2017 was down to $69M by mid-2018, and Q3 transactions are seen falling again quarter-over-quarter.
Second-order effects
- Competing chains can't pick up the slack: Bitcoin Cash's own payment volume fell by roughly two-thirds between March and May 2018, so the payments use case offers no differentiation for either chain's value proposition.
Third-order effects
- The pattern recurs across cycles — Bitcoin posted its worst quarter since Q3 2011 in mid-2022, and crypto trading volume dropped 63% from its February 2025 peak — suggesting activity metrics are driven by speculative flows rather than durable transactional demand, which is exactly what this 2018 study first quantified.
The trend: Each crypto cycle repeats the same shape: usage and volume metrics peak with prices and then contract far faster than the asset itself, exposing how thin real-world transactional demand is beneath the market.