Coinbase Proposes New Metric To Accurately Track Blockchain and Crypto Adoption
Coinbase, the largest crypto exchange in the US, says there’s a need to accurately measure the true adoption of blockchains beyond what already exists.
In a new blog post, Coinbase says that as more applications launch, tracking the adoption of blockchain ecosystems becomes difficult as traditional metrics like total transactions or daily active addresses become distorted due to spam and Sybil attacks – an exploit that involves the forging of multiple identities in peer-to-peer networks.
To address these difficulties, Coinbase proposes using the h-index, which was originally created to measure the productivity and impact of scientific publications.
Coinbase says it has taken the h-index and adapted it to blockchains by tracking the number of addresses that have been on the receiving end of transactions the same number of times.
Says Coinbase,
“The h-index originated in academia as a way to quantify the research output and impact of a researcher, calculated by counting the number of publications that have been cited at least that same number of times. (For example, five publications that have been cited five times each would have an h-index of five.)
We have adapted this metric to measure the activity on blockchain networks by looking at the number of addresses that have been on the receiving end of transactions at least that same number of times. In other words, an h-index of 100 means that 100 different receiving addresses had received transactions from at least 100 unique sending addresses over a given time frame.”
Using the new metric, Coinbase says that out of all the Ethereum Virtual Machine (EVM)-compatible chains, ETH has the strongest level of adoption, followed by Base, Arbitrum (ARB), Optimism (OP), Polygon (MATIC), Avalanche (AVAX) and Fantom (FTM).
“Our findings indicate that Ethereum and Base have the most widespread user activity of those measured, with Arbitrum and Polygon PoS following close behind.”
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Author: Alex Richardson
