Hive is Performing Well In the Bear Market

It can be difficult to compare usage activity on different blockchains directly to each other because transactions can be of radically different types across blockchains, and even when you standardize with something like an "operation" for performance purposes, the value and meaning of a transaction to a user can still be dramatically different across chains.

An alternative is to instead compare a chain to itself. For example, we can measure the highest point of transactions per day in the bull market, to how many transactions were done yesterday on the same chain. We can then say how much it has dropped off (or if it has actually grown in the bear market), and compare that drop off a similar phenomenon on other chains. There are still limitations to keep in mind, such as if a networks peak resulted in congestion. In that case the peak was limited by technical constraints, and could have been higher, so the real drop in demand could be higher than it appears. This could be the case for Bitcoin and Ethereum, which were highly congested resulting in high fees during the bull run.

In order to reduce the impact of outliers and periodic volatility, we will use 7 day moving averages as much as possible.

Bitcoin

The peak in transactions per day was 366409. It has dropped to 267161 today, or 27%. Again, keep in mind that Bitcoin was highly congested at the peak, and the median fee has dropped from $24 at the peak to $0.52 today, implying the real drop in demand is much worse.

Ethereum

Transactions on Ethereum peaked at 1,657,800 per day in May 2021. Today it has dropped to 1,047,400 per day, representing a 37% drop. Like Bitcoin, Ethereum was highly congested at the peak, and median fees have dropped from a peak of $24.44 back then to $1.28 today, again indicating that demand has dropped more than the transaction count alone suggests.

Litecoin

Litecoin peaked at 159,003 transactions per day and has dropped to 103,894 today, a drop of 34%. Unlike Ethereum or Bitcoin, there was no congestion at the peak of demand for Litecoin, and fees have not changed in any meaningful way. Given this, demand for Litecoin transactions has held up remarkably well in the bear market, at least compared to Bitcoin and Ethereum.

Dogecoin

The peak for Dogecoin was actually quite recently, although it only barely surpassed the 2021 bull market peak. From a high of 79,374 in July of this year it has fallen 56% to 34,574 today. As with Litecoin, congestion is not a factor and this drop can be more easily taken at face value.

Steem

I would really like to include Steem here to see just what level of animated undeath it is being kept in, but suffice to say, there doesn't seem to be anywhere to find this data any more without scraping it from the blockchain myself. This is what Dappradar is showing for Steem transactions, which is clearly incorrect if you view steemit.com or steemd.com yourself.

Those still on Steem care enough about it to farm the rewards, and that is about it, it seems.

Hive

Hive transactions per day peaked in November 2021 at 4,305,178, before dropping 48% to 2,209,958. That seems like a very sharp drop, but there are two important caveats here. Firstly despite peaking much higher than most chains mentioned, with over 4 million transactions per day, Hive was not experiencing any serious congestion at these levels. Also, as can be seen in the graph, there was a sharp one-day drop in transactions in June of 2020. This was due to a change in the transaction model for Splinterlands, the biggest Hive dapp by far. If we account for this change, the drop would be about 23%.

Another way to look at this is the social network side of Hive, by looking only at post counts.

In terms of posts, Hive peaked in December 2021 with 5165 posts per day. It has since dropped to 3358 or 35%. Unlike Bitcoin and Ethereum, Hive was not facing serious congestion, and so given that, it actually compares rather well. There is still nearly as much demand to make Hive transactions and posts today as there was at the peak of the bull market.

We can also look at transfers, which are purely financial transactions on Hive.

Transfers peaked in August 2021 at 38,838, and have since declined 50% to 19,342. The peak of transfers however relates more to the HBD depegging event last year, although that can be considered a bull market phenomenon. Outside of that incident, we are pretty much as high as we've ever been.

Final Thought

To give a clean bill of health to the Hive network, I would hope to see us growing in usage even as the broader crypto market declines. However, it has been unavoidable so far that demand for the platform is connected to the price of the token. Posts may be down 35%, but payouts are down much, much more in the same time, and people keep posting regardless.

Overall we are in a good place, if not exactly where we would like to be.