Bitcoin continues to attract international interest, institutions are steadily adding to their holdings, and its market cap, exceeding $1.7 trillion, reflects its widespread adoption. However, examining the actual behavior of the network reveals a disconnect from the headlines. Over 60% of all BTC has remained inactive for over a year, on-chain activities are declining (partly due to ETF adoption), and miner fee revenues continue to fluctuate. For a system designed for value transfer rather than mere storage, this presents a significant issue for its functionality.
How effective can a network be when the majority of its capital remains stagnant? After all, value movement drives fees, stimulates demand for new tools and applications, and enhances network security. If the observed trend persists, the existing incentive model will likely fall short of what is necessary for future growth.
Bitcoin’s incentive model is nearing its limits
Bitcoin wasn’t designed to remain idle; that goes against its core principles. Its architecture inherently assumes activities driving economic processes. The network depends on transactions for miner payments and requires consistent activity for efficient operations. Yet today, there is a contradiction — a high-value network with low-value transactions.
In contrast to Ethereum or Solana, where users engage with applications, stake tokens, or mint assets, Bitcoin’s usage remains predominantly focused on long-term storage, as evidenced by the large quantity of BTC that remains untouched. While this behavior may protect personal wealth, it undercuts the network’s vitality. Thus, the more BTC is treated as an untouchable asset, the less motivation there is to transact, resulting in a diminished fee pool.
Consider this scenario: in the year 2140, the final Bitcoin is mined. The subsidies cease, and the network must rely exclusively on transaction fees to maintain security. However, user engagement hasn’t increased. Daily transactions linger below 250,000, and average fees stay below $2, all while block rewards diminish.
What does that entail? Miners may deactivate their machinery, leading to decreased security, or Bitcoin might raise fees to a point where ordinary users can no longer participate. This creates a stalemate.
The more alarming reality is that, even by 2025, this situation is becoming increasingly plausible. Currently, fee income represents less than 1% of miners’ rewards — significantly below the 10–15% range required to reduce dependence on new issuance. This illustrates the absence of functional velocity. While scarcity might support pricing, circulation is essential for the network’s sustainability.
If movement is the vital missing element, what steps are necessary to reactivate Bitcoin’s capital? This is where innovative incentive models come into play.
Capital must either become useful or become a burden
Despite Bitcoin’s inherent value, that alone is insufficient to ensure long-term network sustainability. Its capital must be utilized effectively. New on-chain tools are emerging that activate BTC itself.
At the heart of this transformation is BTCFi — a financial layer developing around Bitcoin’s fundamental resource: hashrate. These protocols enable holders to lock their BTC into yield-generating products that bolster network security.
This creates a feedback loop, where users assist miners, miners maintain network security, and the network provides value through consistent on-chain rewards. For the first time at scale, Bitcoin’s computational power is being integrated into a financial mechanism that strengthens the system from within, rather than relying solely on speculative excitement.
Of course, there are skeptics. Analysts assert that BTCFi has yet to make significant progress due to modest adoption, limited liquidity, and the majority of BTC remaining in cold storage. This observation is valid and, to some extent, accurate. Nonetheless, it does not negate the direction. Instead, it emphasizes the urgency of the matter.
Since Bitcoin was never intended to remain locked away, but rather to move, interact, and circulate, BTCFi is the next logical step in enabling actual utilization of BTC.
A monetary revolution requires participants
One key lesson from highly engaged ecosystems like TRON is that activity isn’t accidental. Networks flourish when participation is straightforward, incentives are clear, and value flows through the system rather than remaining stagnant.
This principle holds true for institutions as well. They do not intentionally keep Bitcoin inactive; they simply follow the incentives shaped over years of treating BTC as a macro hedge. Therefore, as long as holding yields more benefits than participating, trillions will remain in cold storage. When risk-adjusted on-chain yields become irrefutable, that behavior will shift.
This brings us to the broader truth: Bitcoin cannot thrive as a mere historical artifact. It must evolve into an economy.
