Transaction values for top cryptocurrencies show Dash, as well as Bitcoin Cash and Dogecoin, used most frequently in small transactions, which could indicate real-world use as money.
Data from BitInfoCharts of several major cryptocurrencies shows statistics and trends that can be used to infer the nature of economic activity across the networks. The networks sampled were Bitcoin, Bitcoin Cash, Litecoin, Dash, Zcash, and Dogecoin. These were chosen based on availability of data and on a purpose for use as money (Ethereum’s extremely low median transaction value indicates non-monetary purposes such as smart contracts). Monero was excluded due to the unavailability of public network data, and Dogecoin was included due to its historical significance and persistently high network use.
Median transaction values use the middle value of a data set (example: 1, 1, 3, 12, 84 would give a median of 3) to infer what could be considered a “typical” amount. This is weighted towards the greater number of transactions rather than a significantly higher or lower value of just a few transactions. The most recent statistics show Dash as the lowest with a median transaction value of $16.30, followed by Dogecoin at $17.82. Bitcoin Cash and Litecoin are in the next lowest category with $35.50 and $84.64 respectively, while Bitcoin and Zcash are the highest with $297.38 and $406.79 respectively. Median transaction values across the board were far higher during the December/January period, however Dash’s value has fallen significantly, from the middle of the pack to a mere fraction of most competitors, while Zcash’s has actually increased where it used to be significantly lower than Dash.
Average values diverge from median with BCH and Dogecoin showing huge spikes
Average transaction values, on the other hand, tell a different story. Averages are computed by adding together all values in a set and dividing by the number of values in that set (example: 1, 1, 3, 12, 84 would give an average of 20.2). This skews the value towards single extreme numbers rather than towards the number of values, meaning a coin with mostly low-value transactions can have its average value significantly increased by a few very high-value transactions. Once again, Dash is the lowest in this data set with an average of $2,662 at time of writing, however now Litecoin ranks in as second-lowest with $9,729. Bitcoin Cash and Dogecoin come next with $18,831 and $19,206 respectively, with Bitcoin and Zcash once again ranking highest with $21,082 and $32,006 respectively.
The relative difference between Dash and the rest of the group remains fairly consistent from the median values. Bitcoin Cash and Dogecoin, however, have jumped from the low end of the pack to the mid-high end when computing average value. This indicates that, while those two have high numbers of low-value transactions, a smaller number of very high-value transactions have dragged the whole average up.
What can be inferred from transaction value data?
Because of their decentralized and pseudonymous nature, cryptocurrencies could in theory be used for any purpose by anyone at any time, and as such network data eludes providing many definite conclusions. Reasonably accurate speculation, however, can be made based on inferences from statistical data. In the case of Zcash and Bitcoin, the consistently large value of transactions across both median and average could indicate that they are mostly used to transfer large amounts of money, most likely on and off exchanges to either liquidate profits or move savings to storage. Litecoin indicates a similar trend on a much smaller scale, and this combined with December’s surge when the two larger Coinbase-listed coins (Bitcoin and Ethereum) had congested networks leaves evidence that it could be used by newer and smaller-scale investors who may view Bitcoin as too expensive. It may be worth noting that of all the coins analyzed here, Litecoin’s median transaction value (1.46 LTC) is closest to a single unit of the coin by a significant margin.
Bitcoin Cash and Dogecoin, on the other hand, have two conflicting stories: low median transaction value and relatively high averages. In particular, these two coins have experienced significant spikes in the average value in select instances, registering many times the average value of even Bitcoin and Zcash on those days. These data points combined could indicate that both are typically used for small retail transactions, however a few large whales buying or dumping on select days have driven the average up. Another possibility is that both are used largely for speculative purposes such as moving large amounts on and off exchanges and to storage, but both networks additionally leverage cheap fees for a high volume of transactions unrelated to purchases such as scripts, tip bots, network stress tests, and non-currency uses such as social media platform Memo.Cash. This seems more likely than the first hypothesis due to the average on any given day being relatively high, rather than purely on average spike days.
Dash shows the clearest trend towards real use as currency
Finally, Dash has maintained consistently low average and median transaction values, indicating that it is most commonly used for retail purchases and other similar purposes. This hypothesis is corroborated by merchant data from Anypay as well as the 2,000+ and counting Dash-accepting merchants in Venezuela, nearly all of whom exclusively accept Dash and support no other cryptocurrency. Of note, however, is that Dash’s median and average transaction values were comparable to the other coins measured, and even higher than some, during the December/January period. Starting this spring, these values have declined significantly faster than those of the others, indicating a shift towards real-world use. This is further corroborated by transaction volume data showing most cryptocurrencies exhibiting a significant decline in daily transactions since the end of the winter’s speculative bubble, which Dash’s have remained relatively constant, indicating an increase in merchant transactions to counteract the drop in speculative transactions.
