Ethereum is currently the leader in decentralized finance, non-fungible tokens, and smart contracts, and it continues to maintain its position as the dominant cryptocurrency in the altcoin market. This has led to Ethereum having the highest rate of creation of new addresses when compared to the other blockchains. However, data suggests most of these new addresses are dumped just after a few days.
New Ethereum Wallets Are Used for Only a Short Time
Ethereum is second to Bitcoin in terms of unique addresses. Ycharts estimates put the number of unique addresses on the Ethereum network to around 239.62 million. However, on-chain transaction data shows that if you’ve just created a new Ethereum wallet, chances are you won’t be using it for long.
According to crypto data analyst Jack Gorman, over 70% of new Ethereum wallets are used for less than 30 days before the owners stop transacting completely. While taking to a customized graph on Dune Analytics, a blockchain ecosystem analytics platform, the data analyst noted the rate of creation and abandonment of new Ethereum addresses.
The data show that Ethereum has one of the highest rates of new addresses, with 2 million new wallets per month. In the past year alone, more than 26.69 million wallets were created. However, most new addresses display minimal activity, with 66% only active for one day and 95.5% being active for less than ten days. For instance, in May 2023, 2.41 million addresses were created, with only 6.91% making transactions after 30 days.
ETH price sitting at $1,876 | Source: ETHUSD on Tradingview.com
Overall, monthly active addresses total around 4.5 million to 7 million. This means that most wallets don’t last long, and only 1.9 million are active for more than 10 days. Fewer addresses are used frequently and long-term, with only 400,000 addresses completing more than 100 transactions in the past year.
Why Are There So ETH Addresses?
Ethereum has had one of the most impressive adoption rates in recent years. The creation of new addresses provides valuable insights into improving adoption and longevity, and the creation and abandonment of addresses can be traced to airdrop hunters. Airdrop hunters create multiple addresses with the sole aim of farming ERC-20 tokens from airdrops.
While the retention rate of new wallets is really low, Ethereum is blessed with various holders, including smart contract addresses and centralized exchanges. The Eth2 Beacon Deposit Contract has the largest address, boasting more than 27.6 million ETH and a 22.9% stake in the network.
Featured image from iStock, chart from Tradingview.com
