According to the crypto and blockchain analytics firm Diar, Ethereum’s on-chain transaction volume hit an all-time high in December 2018.
The data compiled by Diar goes as far back as Ethereum’s first transaction in 2015, and according to the analytics, Ethereum reached 115 million on-chain transactions in December 2018. This signals an all-time high for Ethereum transactions, excluding activity following the hard fork caused by the DAO hack in 2016.
As stated by Diar:
“In terms of transaction count on-chain, the ‘supercomputer’ has found stability since October bobbing between 16–17 million monthly transactions.”
Analyzing Ethereum’s On-Chain Transaction Data
As seen from the data represented in the graph above, Diar compiled on-chain transaction data from as far back as Ethereum’s first transaction in 2015. Disregarding transactions around the DAO hack, Ethereum’s transactions increased steadily from 2015 to the beginning of 2017, then tapered off until the beginning of 2018.
Through 2018, the number of Ethereum’s on-chain transactions decreased, hovering around 16-17 million monthly transactions, until November and then December where they reached an all-time high of 115 million monthly transactions.
The increase in transactions can be attributed to Ethereum’s volatile trading action with a massive sell-off resulting a low price of $83 on December 15, followed by a surge in price to $155 on December 24. This price move represents a near-50% increase in price, which is one of the largest moves by Ethereum in 2018.
US Dollar Value of On-Chain Transactions Hit 22 Month Low
While Ethereum on-chain transactions hit an all-time high in December 2018, the US dollar value of these transactions hit a 22 month low during the same month. The total US dollar value on-chain was $815 million last year, which is down significantly from $1.1 billion during the crypto bull run in 2017.
As stated in the Diar analytics report:
“A 97 percent drop in on chain transaction value from the peak in January versus December 2018 was, by and large, the cause of an 80 percent drop in Ethereum’s price.”
Constantinople Upgrade Will Reduce Ethereum’s Already Low Fees
Moreover, regarding the continued growth of on-chain transactions on the Ethereum blockchain, Diar stated that fees are unlikely to interfere with Ethereum’s growth as the blockchain already has the lowest fees for on-chain transactions.
Also, Ethereum developers intend to keep their fees low, as the upcoming Constantinople upgrade will bring down Ethereum’s fees even further for certain types of transactions. Developers are lowering fees not because they need to, but because they’re thinking very long-term.
As previously reported by IIB, the Constantinople upgrade has been delayed after auditors found a vulnerability in the code. The bug that was found would allow for a reentrancy attack, which would allow the attacker to siphon users’ funds by sending the same function multiple times.
Since the vulnerability was found, Ethereum developers have decided to push back the upgrade until February 27 at block number 7,280,000. Developers have already decided how they will fix the bug and implement the Constantinople upgrade, but they are further pushing the date back to ensure there are no more bugs.
Will 2019 be another slow year for Ethereum on-chain transactions, or will we see an overall increase from month to month? Let us know what you think in the comment section below.