How Can a Protocol’s Gas Fee Structure Influence the Reported Number of Active Users?
A protocol's gas fee structure directly influences the reported number of active users. If fees are extremely low or subsidized, it lowers the barrier to entry, potentially attracting a high number of low-value, non-economic, or even spam-related transactions, which inflates the active user count.
Conversely, high fees deter casual users, resulting in a lower but potentially higher-quality active user count, composed mainly of users performing high-value transactions.
Glossar
Gas Fee
Mechanism ⎊ Gas fees represent the computational cost required to execute a transaction or smart contract on a blockchain network, particularly Ethereum and its Layer-2 solutions, functioning as a deterrent against denial-of-service attacks and a reward for network validators.
Gas Fee Structure
Structure ⎊ The Gas Fee Structure defines the set of rules governing how transaction costs are calculated and paid on an environment like the Ethereum Virtual Machine.
Fee Structure
Allocation ⎊ Fee structures within cryptocurrency, options trading, and financial derivatives represent the systematic distribution of costs associated with executing and maintaining positions, impacting net profitability and strategic decision-making.
Fee Structure Influence
Influence ⎊ The interplay between fee structures and market dynamics within cryptocurrency derivatives, options trading, and broader financial derivatives represents a critical area of analysis for both traders and risk managers.