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Dear Bankless Nation,
Being able to analyze on-chain data is a powerful skill for the next decade.
Use it to derive important insights about protocols, tokens, and the crypto economy.
Since so few actually do the work to look at the data…
On-chain data is alpha.
While analyzing on-chain data used to be difficult and opaque, today it’s easier than ever. There are a number of amazing tools at our disposal, especially on Ethereum.
Etherscan has built a suite of features invaluable for parsing ETH transactions.
Analytic dashboards like Nansen have been tailored to identify the most alpha-driven insights while Dune Analytics allows analysts to build their own unique dashboards for whatever they need.
We also have tools like Token Terminal which have been a key tool for Bankless in identifying the rise in DeFi.
Here’s your guide on how to use on-chain data to find the gems.
– RSA
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Bankless Writer: William M. Peaster , Bankless contributor and Metaversal writer How to analyze on-chain data
A blockchain is a fully public record-keeping system for 21st-century transactions.
The information blockchains store is known as “on-chain data.” Ethereum, which is home to most DeFi and NFT activity, has a growing abundance of on-chain data people can openly inspect.
Analyzing this crypto-centric data is a great way to gain deeper insights into contemporary or historical blockchain happenings. For example, investors use these analyses to find new alpha, NFT archaeologists use them for finding long-lost collections, and citizen sleuths use them for holding scammers to account.
Good stuff right?
Well, you can be doing the same sorts of things in no time! First, though, you’ll need the right tools for the work at hand. Accordingly, this Bankless tactic will walk you through some of the best resources available today when it comes to analyzing on-chain data and how to glean important insights from them. Goal: How to analyze on-chain data Skill: Intermediate Effort: Varies ROI: Increased competency in one of crypto’s most useful skills The best tools for on-chain data analysis The aim of on-chain analysis depends on the analyst. An investor who’s considering acquiring a DeFi token could analyze data pertaining to the health of the underlying dapp. Are key metrics trending upward over time? Or is usage steadily going down?Yet performing on-chain analysis doesn’t have to be complicated or involved. It can be as simple as reviewing your previous Ethereum transaction to see if it’s completed or still pending, or checking to see what NFTs your friends have been collecting lately.Whatever your aim, the tools below considerably streamline the process of on-chain analytics and are go-to resources for beginner and veteran crypto analysts alike. 1. Etherscan (and its contemporaries) Image via Etherscan The 101 Etherscan is a block explorer, a special browser platform for reviewing and analyzing all the data stored on Ethereum. The service lets users search for and inspect historical info via address (alphanumeric or ENS style) , transaction hash, block number, token name, etc. Etherscan offers additional resources like an ETH unit converter , a Label Word Cloud ( for searching activity by theme, like “Charity” ), a Verify Contract tool , and beyond. Keep in mind that other networks, like Ethereum scaling solutions, have their own bespoke block explorers. Also, check out: Using Etherscan for on-chain analysis Etherscan is a foundational resource for any crypto analyst because the block explorer makes it simple to parse all the basic details of an Ethereum transaction. Then you can piece together the bigger picture by looking at and understanding transaction flows. As such, you’ll want to learn how to “read” transactions on Etherscan if you haven’t already. For instance, let’s take a quick look at Ethereum creator Vitalik Buterin’s main address. I searched for his public ENS vitalik.eth on Etherscan, which brought me to his address page and recent transactions. In the first transaction visible below, we can see Buterin sent a test transaction of 0.1 ETH to an address as a precaution before sending a much larger sum, 199.9 ETH, to the same address immediately thereafter. Image via Etherscan If we click on the Txn Hash of the test send we can review all of the transaction’s main details, like its precise timestamp, its transaction fee, the value of ETH at the time of the transaction, […]
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