One of the characteristics of the blockchain is its transparency, which means that everyone can see all the transactions that take place there. This provides a unique opportunity to analyse these transactions. In this article, we'll show you how you can analyse blockchain data and what tools you can use to do so. But first things first.
What is on-chain analytics?
Let's start by looking at what on-chain analysis is. We can describe it as the practice of analysing data recorded on a blockchain to gain a deeper understanding of the activity taking place on that particular blockchain.
This technique allows for the identification of trends, patterns and predictions about the future of a blockchain project. One of the key benefits of on-chain analysis is its transparency and objectivity, as all transactions on a blockchain are recorded in a publicly available ledger.
How to perform on-chain analysis
There are several methods of on-chain analysis, such as analysing the volume of transactions over time to identify trends in adoption and usage, or examining the distribution of tokens or assets to understand ownership concentration and potential centralisation.
On-chain analysis can also be used to study the behaviour of different user groups, such as early adopters versus late adopters, or usage patterns across different demographics.
On-chain analysis is a useful tool for anyone interested in gaining insight into the activity and dynamics of a blockchain project, whether for investment, development or simply to stay informed as a member of the community.
On-chain analysis tools
Etherscan - https://etherscan.io/
Etherscan is the most popular Ethereum blockchain explorer and analysis platform.
There are several things you can do on Etherscan:
- View and search Ethereum transactions by their hash and view a list of all transactions on the network.
- Interact with Ethereum smart contracts and see how they have been used in the past
- View information about individual blocks
- Review Ethereum address information such as balance and transaction history
- Use the Etherscan API to access blockchain data
Dune - https://dune.com/
Dune dashboards allow you to build your own dashboards from on-chain data using SQL queries. You can explore dashboards already created by other users and fork them into your own. It is great for visualising the performance of NFT projects, DeFi logs and other on-chain activities.
It is one of the most popular on-chain analysis tools out there. It's easy to use and even if you don't know how to create your own dashboard using SQL, you can still browse other users' dashboards to explore the data.
Coinbrain - https://coinbrain.com/
Coinbrain is the next-generation analytics platform for real-time cryptocurrency analysis and market insights. With Coinbrain you can discover, analyse and trade crypto tokens on Ethereum and BNB Chain.
It also provides several trading tools such as wallet approvals, converter, watchlist and multichart, making it a great tool for anyone to gain an edge in crypto trading.
Lens stats - https://stats.lens.xyz/
Lens stats provides statistics for Lens protocol, which is web3's decentralised social media platform.
You can find metrics such as total profiles, posts, comments and averages per user profile as well as metrics on individual profiles. You can read more about lens in our other article: Emerging trend for 2023: Web3 Social Media
Token Terminal - https://tokenterminal.com/terminal
Token Terminal is a platform that provides traditional financial and business metrics on crypto assets.
These metrics focus on:
- Active users
- Fees and revenue
- Gross merchandise volume
- Token incentives
- Token holders
You will not find all existing projects there, but only those with real use, a long-term vision, a sensible token model and sufficient documentation.
Nansen - https://www.nansen.ai/
Nansen is a blockchain analytics platform that combines on-chain data with a massive and ever-growing database of millions of wallet labels.
Wallet labelling combined with on-chain data is its biggest advantage. For example, investors use Nansen to discover opportunities, perform due diligence and defend their portfolios with real-time dashboards and alerts.
These are just a few examples of some of the most popular on-chain analytics tools out there. More tools are rapidly emerging, as they give us a unique opportunity to learn from all the data that is publicly available on blockchains.
On-chain analytics will be something interesting to dive into as more brands and companies enter web3, because we will be able to study and learn what is happening, what is working and what is not working for web3 strategy. And all this in complete privacy.
To sum up. On-chain analysis can be used by:
- Investors to make informed investment decisions
- Researchers to study and understand blockchain development
- Businesses to understand how their products or services are used by their users
- Law enforcement to investigate and track the illegal activity on a blockchain
- Everyone else - data on a blockchain is available to everyone without permission - no need to wait for quarterly reports
If you're as nerdy about data as we are, then it's time to explore these tools.