Network Activity Score

Overview

This pillar analyzes the fundamental health of a blockchain network by aggregating user activity and transaction volume. It provides a clear signal of a network's real utility, helping to distinguish hype from genuine adoption.

What It Does

It combines two core on-chain metrics, Daily Active Addresses and Transaction Volume, into a single score. By smoothing daily fluctuations with moving averages and weighting the inputs, it produces a standardized measure of network health. This score indicates whether a network's usage is growing, stagnating, or declining.

Why It Matters

Price often follows utility in the long run. This pillar offers a fundamental valuation signal that cuts through market noise and speculation, identifying assets with a strong, growing user base that can support future value.

How It Works

The pillar first collects daily data for active addresses and USD-denominated transaction volume. It then calculates a 7-day moving average for each metric to smooth out volatility. These averages are normalized on a 0-100 scale and combined into a final weighted score that reflects overall network activity.

Methodology

The score is a weighted composite of two indicators: Daily Active Addresses (DAA) and Transaction Volume (USD). It uses a 7-day simple moving average (SMA) for each metric. Each metric is then normalized using a 90-day min-max scaling formula. The final score is calculated as: Score = (0.6 * Normalized_DAA_7d_SMA) + (0.4 * Normalized_Volume_7d_SMA).

Edge & Advantage

It provides a data-driven view of network health that is independent of price action, helping to spot divergences where on-chain activity is rising before the market price reacts.

Key Indicators

• Daily Active Addresses (DAA)

  high

  Measures the number of unique addresses interacting with the network, indicating user engagement.

• Transaction Volume (USD)

  high

  Measures the total value of transactions, reflecting the network's economic throughput.

• New Address Growth

  medium

  Tracks the rate of new address creation, signaling network adoption and expansion.

Data Sources

• Glassnode

  Provides comprehensive on-chain metrics and intelligence for major cryptocurrencies.

• Dune Analytics

  A platform for user-generated SQL queries on public blockchain data.

• The Graph

  A decentralized protocol for indexing and querying blockchain data.

Example Questions This Pillar Answers

• → Will Ethereum's daily active users exceed 1 million by the end of the month?
• → Will Solana's transaction volume be over or under $10 billion next week?
• → Which L1 blockchain will show the highest network activity growth in Q3?

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