The number of daily transactions on the Ethereum blockchain network surpassed 1 million, a level unseen since January 2018.
In recent months, network activity on Ethereum surged as a result of rising demand for decentralized finance (DeFi) applications and growing anticipation towards ETH 2.0.
Why is Ethereum Daily Transaction Volume Climbing So Rapidly?
Since January 2020, within six months, the daily transaction volume of the Ethereum blockchain increased from 435,000 to 1.073 million.
Two factors likely triggered the 146.6% upsurge in user activity on Ethereum: a spike in investors sending funds to DeFi applications and on-chain stablecoin transfers.
DeFi platforms essentially allow users to carry out conventional financial services in a decentralized environment.
For example, through DeFi, cryptocurrency investors can lend their surplus holdings to borrowers. In exchange, borrowers incentivize lenders with monthly returns.
For users to start using DeFi, they first need to send funds on the blockchain network. That can be ETH, Tether, or any other token that they hold. To do that, the users need to send transactions to and from DeFi applications.