Ethereum is currently the leader in decentralized finance, non-fungible tokens, and smart contracts, and continues to maintain its position as the dominant cryptocurrency in the altcoin market. This has resulted in Ethereum having the highest number of new address creations compared to the other blockchains. However, data suggests that most of these new addresses are dumped after just a few days.
New Ethereum wallets are only used for a short time
Ethereum is second only to Bitcoin in terms of unique addresses. Y cards estimates put the number of unique addresses on the Ethereum network at about 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, more than 70% of new Ethereum wallets are used for less than 30 days before the owners completely stop trading. Going to a custom chart on Dune Analytics, a blockchain ecosystem analytics platform, the data analyst noted the speed of the creation and exit of new Ethereum addresses.
The facts showing 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 have been created. However, most new addresses show minimal activity: 66% are active for only one day and 95.5% are active for less than ten days. For example, in May 2023, 2.41 million addresses were created, of which only 6.91% transacted after 30 days.
ETH price sitting at $1,876 | Source: ETHUSD on Tradingview.com
In total there are about 4.5 million to 7 million active addresses every month. This means most wallets don’t last long, with only 1.9 million being active for more than 10 days. Fewer addresses are in frequent and long-term use, with only 400,000 addresses completing more than 100 transactions in the past year.
Why are there so many ETH addresses?
Ethereum has had one of the most impressive adoption rates in recent years. New address creation provides valuable insights into improving adoption and longevity, and address creation and abandonment can be traced back to airdrop fighters. Airdrop hunters create multiple addresses for the sole purpose of farming ERC-20 tokens from airdrops.
While the retention rate of new wallets is very low, Ethereum is blessed with several holders, including smart contract addresses and centralized exchanges. The Eth2 Beacon Deposit Contract has the largest address, with over 27.6 million ETH and a 22.9% stake in the network.
Featured image from iStock, chart from Tradingview.com