TL; DR breakdown
- ETH Q1 result for 2021.
- Reactions to the result of the ETH 2021 Q1.
The leading number one decentralized open source blockchain (Ethereum) recently released its performance for the first quarter of 2021. The network undoubtedly had a lot to report during the period.
The publication describes the year 2021 as the most important year in the history of Ethereum and names economic security and scalability as two key themes for 2021.
In April, Ethereum’s core development team approved EIP1559 – a software update that improves the block storage bidding process and introduces a burning mechanism for the base portion of the transaction fee. Fee Burn offsets a significant portion of the ETH issue and, in turn, paves the way for long-term network security with minimal dilution. EIP1559 will be deployed in test networks on June 9th, followed by an official rollout via the London hard fork on July 14th.
The publication also shows that Ethereum intends to move from its current proof-of-work algorithm to the proof-of-stake. The first version of the proof-of-stake chain (“Beacon Chain”) was published in December 2020. On May 12th, the developers successfully merged the two chains in a test environment. Proof of participation reduces ETH’s energy consumption by 99 percent, while all ETH holders are granted democratic access to bonuses.
Key findings from the Ethereum Q1 ecosystem
First, the transaction fee for the network increased 200 times in the first quarter of 2021 to $ 1.7 billion from $ 8 million in the first quarter of 2020. In April, ETH posted an annual revenue rate of $ 8.6 billion. Dollars – comparable to AWS in 2015.
Transaction volume for Ethereum increased 20 times to $ 713 billion in the first quarter of 2021, compared to $ 33 billion in the first quarter of 2020, and the median transaction fee increased 126 times to 7 in the first quarter of 2021, $ 63, compared to $ 0.06 in the first quarter of 2020.
Daily active addresses rose 71 percent to 607,000 in the first quarter of 2021, compared to 364,000 in the first quarter of 2020 when the staked ETH, launched in December 2020, hit 3.6 million ETH in the first quarter of 2021.
For the ecosystem, the DEX (Decentralized Exchange) volume increased 76-fold to $ 177 billion in the first quarter of 2021, compared to $ 2.3 billion in the first quarter of 2020. The total value of its decentralized funding (DeFi) increased in in the first quarter of 2021 also by 64 times to $ 52 billion. $ 0.8 billion in the first quarter of 2020.
The value of the stable coins at ETH also increased five-fold in the 1st quarter of 2021 to 41.9 billion US dollars, compared with 7.1 billion US dollars in the 1st quarter of 2020.
NFT art revenue increased 560 times to $ 396 million in the first quarter of 2021, compared to $ 0.7 million in the first quarter of 2020.
Reactions to the ETH report Q1
Anthony Sassano, founder of The Daily Gwei, described the first quarter as a phenomenal quarter for Ethereum. He alluded this to the on-chain metrics from active addresses to transaction volume, which all hit all-time highs.
“DeFi’s popularity shows that ETH is more than just a cryptocurrency, it is the world’s best programmable money,” said David Hoffman, founding father of Bankless.
“People are realizing that Ethereum is not just money, it’s ultra-solid money,” said Justin Drake, a researcher at the Ethereum Foundation. “While other cryptocurrencies may have an upper limit of supply, Ethereum will soon no longer have a lower limit of supply.”
The strong growth at ETH in the first quarter was not without pain. Gas prices rose in the first quarter due to the incredible popularity of DeFi and NFT applications.