Overview

An active wallet on blockchain is any wallet that has been used to store and/or transact cryptocurrency. It refers to a wallet that has received transactions or has a balance, and is considered to be active on the blockchain network.

An active wallet on Terra network can be used to send, receive, swap and provide liquidity a set of cryptocurrencies and has a unique address that is publicly visible on the blockchain.

However, not all wallets are active for a while. In fact, the major of them are active once a month or only one day in its history. For this reason, the question of active wallets faces every ecosystem.

The intention of this dashboard is to try to make a good definition for what is an “active wallet” going beyond the “one transaction in 30 days” approach.

Methods

The main idea is to differentiate between high quality user wallets and the rest of the wallets. Then, first of all, what is an active high quality wallet? In my opinion, it is a wallet that transacts (send, receive, swap or provide liquidity) at least 5 out of 7 days of the week. Based on the amount of weekly days a wallet is active, we can catalogued blockchain users. In this case, we will divide the active wallets in three groups based on its weekly activity:

• High quality wallets: transacting at least 5/7 weekly days
• Moderate quality wallets: transacting between 2 and 5 weekly days
• Low quality wallets: transacting less than 2 weekly days

\n Once definition is provided, the following metrics will be computed:

• How many active users exist on Terra, according to this definitions.
• Which type of users are these active wallets.
• Specific ideas to attract additional users, and what it would cost to implement these ideas.

Looking at the first charts, we can see the active wallets on Terra ecosystem by type and the transactions done, as well as the fees spent on the network. Looking at the first image, it can be seen that the major of the wallets are active less than 2 days in a week. In fact, the second image shows that during the first weeks, this type of wallets represented more than 90% of the active wallets. However, the dominance of low quality wallets has been decreasing over time and its now below 80%. Both, wallets transacting between 2-5 days and more than 5 days shares increased over time passing from 16 to 20% and from 1 to 3% respectively.

Regarding the transactions these wallets are doing, even during the first month the three groups seemed to be doing similar number of transactions, the situation was reverted on September when high quality wallets started to increase its number of transactions and since then, the number has been increasing passing from 15k weekly transactions to more than 60k, representing now almsot 60% of the total transactions vs the previous 30% of dominance before September. In cumulative numbers, it can be seen how in December, the 1 active day wallets and +5 active days wallets lines crossed and the +5 active days wallets surpassed the 1 active day wallets in total number of transactions.

Finally, in terms of fees, it can be seen how again, high quality wallets are generating more fees than the rest of the wallets. Its dominance increased from 25% before September to current 66%. In fact, even the difference in number of users, the high quality wallets are reaching the low quality wallets in terms of total accumulated fees.

Regarding the LP active wallets, it can be seen that in this case, the major of the wallets are active between 2 or 5 days and also less than 2 days in a week. However, looking at the distribution chart, it shows that the high quality wallets has been increasing over time in percentage increasing from 3% to 8%.

Regarding the LP actions these wallets are doing, it seems that in this case, the moderate quality wallets are those who are doing more transactions by week, folloed by 1 day active wallets and at the end the +5 days active wallets. However, the numbers are closer than expected because in this case, the percentage share of LP actions for high quality group is higher than 20%. In cumulative numbers, it can be seen how 2-5 active days wallets are taking distance from the others reaching a total of +18.5k actions vs 11.5k actions from 1 day active wallets vs 6k LP actions from +5 active days wallets.

Finally, taking a look at the swapping active wallets, it can be seen that in this case, the major of the wallets are both active between 2 or 5 days and also less than 2 days in a week. However, looking at the distribution chart, it shows that the high quality wallets has been increasing over time in percentage increasing from 1% to 8%.

Regarding the swaps these wallets are doing, even during the first months the three groups seemed to be doing similar number of swaps, the situation was reverted on November when high quality wallets started to increase its number of swaps and since then, the number has been increasing passing from 1k weekly swaps to more than 16k, representing now almost 90% of the total swaps vs the previous 45% of dominance before November. In cumulative numbers, it can be seen how practically since the start, the +5 active days wallets surpassed the other groups in total number of swaps and since January, the difference has started to increase dramatically. So far, high quality wallets have done more than 120k swaps, while moderate wallets less than 50k and low quality wallets less than 25k.

Key insights

• There are currently a total of 12.4k active wallets on Terra in a weekly basis. 2.77% (344) of them are quality active wallets considering our definition of those wallets who transact more than 5 days in a week.
• During the first month, 90% of the active wallets transacts less than 2 days in a week. However, the dominance of low quality wallets has been decreasing over time and its now below 80%.
• High quality wallets has increased in percentage from 1 to 3% respectively.
• On September, the high quality wallets started to increase its number of transactions and since then, the number has been increasing passing from 15k weekly transactions to more than 60k, representing now almost 60% of the total transactions vs the previous 30% of dominance before September.
• High quality wallets are generating more fees than the rest of the wallets. Its dominance increased from 25% before September to current 66%. In fact, even the difference in number of users, the high quality wallets are reaching the low quality wallets in terms of total accumulated fees.
• The major of the LP wallets are active between 2 or 5 days and also less than 2 days in a week. However, looking at the distribution chart, it shows that the high quality wallets has been increasing over time in percentage increasing from 3% to 8%.
• Regarding the LP actions these wallets are doing, it seems that in this case, the moderate quality wallets are those who are doing more transactions by week. However, the numbers are closer than expected because in this case, the percentage share of LP actions for high quality group is higher than 20%.
• The major of the swapping wallets are both active between 2 or 5 days and also less than 2 days in a week. However, looking at the distribution chart, it shows that the high quality wallets has been increasing over time in percentage increasing from 1% to 8%.
• On November, the high quality wallets started to increase its number of swaps and since then, the number has been increasing passing from 1k weekly swaps to more than 16k, representing now almost 90% of the total swaps vs the previous 45% before November. In cumulative numbers, it can be seen how practically since the start, the +5 active days wallets surpassed the other groups in total number of swaps and since January, the difference has started to increase dramatically.

Global transactions activity

LP activity

Swap activity

Final conclusion

After this dive deep analysis, we can clearly corroborate that the high quality wallets on Terra are more likely to doing swaps than LP actions. Since the end of 2022, the activity of these wallets has increased considerably, surpassing the activity of the rest of the groups and reaching more than 60% of the network activity except the LP actions.

The acquisition cost for a high-value user depends on the type of user you want to attract and for this reason, you have first to determine the target audience. In this case, I think that it is clear that the type of users Terra needs to attract more are swappers, due to the main activity of its high quality wallets. It is clear that these users are generating the major of the fees but the most important thing is that they are generating more than 90% of swaps in Terra and then, they are the main sources of LP fees rewards.

To be able to acquire more users, the main strategy could be to generate a good marketing campaign including social media alerts, some affiliate programs, bounty/reward programs, bug bounty programs, community building strategies or some engagement activities. The maximum cost of acquiring a high-value user can be determined based on the amount of fees they are generating on the network. Based on the total fees they have generated so far and the amount of weekly fees they are generating, it is clear that a huge campaign could be designed. The exact cost will depend on the size and scale of the marketing efforts and the target audience's engagement with the ecosystem. It's important to note that the cost of acquiring a user is just one aspect of the overall business strategy and should be carefully evaluated and balanced with other expenses.

The other thing I have in mind is to make a dive deep report about the competition and to try to get the most important things other competitors have to attract more high quality wallets and also, which of them are acquiring more swappers to try to do similar approaches to increase in that point.

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