Web3 is drowning in metrics, most of which paint an unclear image. Transaction volumes, token costs and flashy headlines usually masks what actually issues: the standard of consumer engagement and the potential for natural, exponential progress. Because the trade strikes past the hype, dependable, data-driven alerts of success are not non-obligatory — they’re important.
Right here’s the excellent news: the instruments to chop by the noise exist already. By combining a number of on-chain metrics right into a single “well being index” rating indicating the depth and high quality of total consumer engagement, we will determine which chains are actually thriving and poised for long-term progress. With 2024 coming to a detailed, let’s dig into what these alerts reveal about right this moment’s main chains, and what we will anticipate in 2025.
Assessing consumer high quality utilizing aggregated, not remoted, information
When making a sustainable on-chain ecosystem, it doesn’t make sense to optimize any single consumer motion. What’s wanted is context — a option to quantify not simply every thing customers are doing, however how and why it issues. One promising strategy to attain that is to combination consumer behaviors into 5 core classes:
- Transaction Exercise, starting from spot trades to sensible contract interactions.
- Token Accumulation within the medium-to-long-term, and different “funding” behaviors.
- DeFi Engagement for actions like staking, lending and liquidity provision.
- NFT Exercise similar to minting, buying and selling and utility-driven interactions.
- Governance Participation to quantify DAO or protocol governance contributions.
Crucially, these metrics shouldn’t be handled equally. A greater strategy is to weigh and mix them utilizing a Bayesian mannequin to generate a single top-line “rating.” Not like conventional scoring programs that depend on static thresholds or easy averages, this lets us incorporate each prior data (what we anticipate from an “common” pockets) and new proof (precise exercise noticed on-chain). These dynamic, multi-variate scores are a lot tougher to sport and subsequently extra prone to reveal correct, actionable insights.
What the information tells us about 2024
The above strategy gives a recent perspective on every chain’s consumer exercise by 2024. Let’s zoom in on a few of the extra shocking findings.
Solana (the highest gentle blue line that peaks at ~2.75) attracted an enormous share of high-quality customers between February and mid-March, however engagement high quality has fallen since. Curiously, this downslide coincided with SOL’s first value and buying and selling quantity spike of 2024, and has continued by the present memecoin mania. Repetitive actions have diminishing returns when assessed utilizing a Bayesian mannequin, which means a number of token swaps yield smaller rating enhancements than engagement throughout a number of sorts of actions, for any given pockets. This means most Solana customers are at the moment engaged in a slim vary of on-chain actions that aren’t contributing to Solana’s multi-sector progress.
As for Ethereum supporters (the underside orange line that begins at simply above 1) who anticipated this yr’s ETH ETFs to be a game-changer, the numbers paint a distinct image. Ethereum’s low and secure consumer rating by H1 2024 means that this yr’s bullish developments didn’t spur broader ecosystem participation similar to DeFi exercise and protocol governance.
It’s additionally value noting that Axelar (the darkish blue line that begins at 2.5) had probably the most lively customers throughout the broadest vary of on-chain actions relative to its whole consumer base, based on the information. Whereas Axelar is at the moment a lot smaller by TVL than the legacy chains dominating right this moment’s headlines, that is an intriguing sign that warrants nearer inspection — and would have been missed if we have been market cap or buying and selling quantity alone.
The takeaway right here isn’t that Solana is doomed and Axelar will inevitably turn out to be the world’s greatest chain. There’s restricted worth in evaluating a lot of these scores throughout chains, since every rating is proportional to the consumer high quality of its corresponding chain. In different phrases, a Solana consumer with a rating of “4” could also be very completely different from a “4” on Axelar, given the variations in every chain’s baseline exercise. As such, these scores are most helpful when monitoring modifications within the high quality of a sequence’s total consumer exercise over time, not cross-chain comparisons.
Predictions for 2025
With that mentioned, what does every chain’s consumer high quality observe file inform us about subsequent yr?
For starters, it’s clear that Solana faces important challenges and alternatives coming into 2025. The chain’s trajectory is dependent upon its means to retain its huge informal consumer base and increase their vary of on-chain interactions. Failure to take action might end in a big hunch as soon as memecoins cool off — though information from early 2024 suggests the chain has a big contingent of high quality customers that can endure no matter what occurs short-term.
2024 demonstrated Axelar’s means to draw a concentrated consumer base engaged in numerous, sustained on-chain actions, reasonably than speculative surges. Now, Axelar’s problem shall be upscaling its ecosystem with out diluting the standard of its consumer base. This may increasingly contain prioritizing high-profile partnerships to unlock new audiences whereas creating extra newbie-friendly onramps throughout its dApp ecosystem.
Ethereum’s fragmentation has shifted many lively customers to its quicker, cheaper L2 ecosystem, and so we might even see mainnet exercise more and more consolidate round core options protocol staking and governance. These actions are essential for the broader EVM ecosystem, however this trajectory could also be penalized by scoring programs that reward numerous on-chain engagement.
This dynamic underscores a problem for scoring programs: prioritizing wide-ranging consumer exercise can current an incomplete image when utilized to task-specific networks (or normal function chains which can be evolving into one thing extra specialised). Consequently, it’s necessary to obviously outline what success means for no matter chain is being evaluated and use a scoring system that captures the corresponding consumer actions.
A greater option to outline, and drive, on-chain progress
Web3 has spent too lengthy chasing the mistaken metrics and failing to view the information in combination. In 2025, the winners shall be those that discover multivariate methods to measure — and act on — what issues most: consumer high quality.
By incorporating new scoring strategies into their dashboards, on-chain intelligence platforms can present extra significant insights to traders and trade observers. On the similar time, Web3 builders can use these scores to make clear prime priorities and drive consumer engagement and worth creation. In the end, it will assist your complete trade shift away from hype-driven narratives to data-backed methods that unlock the complete potential of Web3 in 2025 and past.
