Tezos First Quarter 2023 Report: Key Takeaways

On April 24th, Messari released Tezos’ first quarter 2023 status report, with the following key points: Tezos’ market value increased by 55% in the current quarter, outperforming the overall encryption market (market value growth of 46%). However, the total gas fee revenue decreased by 23% month on month (excluding storage costs). In addition, Tezos has implemented various destruction mechanisms. This includes creating new accounts or smart contracts, allocating additional smart contract storage, and deleting validator errors. Despite these destruction mechanisms, the destruction rate is very low, with an annual proportion of less than 1%. The circulation supply of XTZ increased by 1.1% month on month and 4.4% annually in the quarter. After strong performance in the fourth quarter, Tezos’ online activities showed mixed results in the first quarter of 2023. Although the total active accounts increased by 1.4% month on month, reaching the highest level since the first quarter of 2022, new accounts decreased by 40% month on month. The surge in new accounts in the fourth quarter of 2022 was due to the casting of Manchester United NFT. In terms of network usage, the daily average smart contract call decreased by 25% month on month, reaching the lowest level in a year. However, the trading volume slightly increased month on month, with an average of approximately 45000 transactions per day last year. The decline in smart contract calls comes from the NFT and gaming fields.

Messari: Q1 Tezos market value increased by 55%, gas fee revenue decreased by 23% month on month

Tezos’ first quarter 2023 report has been released by Messari and it reveals some interesting key points about the state of the network. Tezos, like many other cryptocurrencies, has seen bullish market performance in the first quarter. However, there have also been some notable changes in the network’s underlying dynamics. This article will outline some of the key takeaways from the report.

Increase in Market Value

The first major point to draw from the report is that Tezos’ market value increased by 55% in the current quarter. This outperformed the overall encryption market, which saw a growth of 46%. As a result, Tezos’ market capitalization has increased to over $5 billion. This is largely driven by the strong investor interest in cryptocurrencies, particularly in the wake of Bitcoin’s historic bull run. Tezos has benefited from this trend, and its strong price performance reflects this.

Decreased Gas Fee Revenue

Despite the rise in market value, Tezos’ total gas fee revenue decreased by 23% month on month (excluding storage costs). Although this could be seen as a cause for concern, it is important to note that transaction fees are inherently volatile and can vary based on factors such as network congestion. It is also worth noting that this figure excludes storage costs – which are a significant contributor to overall network usage. This suggests that the actual decline in gas fee revenue may not be as dramatic as it seems.

Destruction Mechanisms Implemented

Tezos has also implemented various destruction mechanisms designed to improve network efficiency. These mechanisms include creating new accounts or smart contracts, allocating additional smart contract storage, and deleting validator errors. Despite these measures, the destruction rate is currently very low, with an annual proportion of less than 1%. This indicates that the network is currently operating efficiently, and that these mechanisms are contributing to its overall stability.

Increase in Circulation Supply

The circulation supply of XTZ – Tezos’ native cryptocurrency – increased by 1.1% month on month and 4.4% annually in the quarter. This is relatively minor compared to the network’s overall market performance, but it still represents a steady upward trend. It is likely driven by investor interest in Tezos, and suggests that the network is experiencing sustained growth.

Mixed Results in Online Activity

While Tezos performed well in the fourth quarter of 2022, its online activity during the first quarter of 2023 was more mixed. Although the total active accounts increased by 1.4% month on month – reaching the highest level since the first quarter of 2022 – new accounts decreased by 40% month on month. This is largely due to the casting of Manchester United NFT in the fourth quarter of 2022. In terms of network usage, the daily average smart contract call decreased by 25% month on month – reaching the lowest level in a year. However, the trading volume slightly increased month on month, with an average of approximately 45,000 transactions per day last year. The decline in smart contract calls comes from the NFT and gaming fields.

Conclusion

In summary, Tezos has performed well in the first quarter of 2023, outpacing the overall cryptocurrency market in terms of market value. However, its underlying network dynamics have shown some volatility. The implementation of destruction mechanisms has contributed to its overall stability, but its online activity has been relatively mixed. Investors should keep a close eye on this cryptocurrency in the coming months to see how it develops in the run-up to Q2.

FAQs

1. What is Tezos’ current market capitalization?
Tezos’ market capitalization is over $5 billion, thanks to a strong performance in the first quarter of 2023.
2. What are some of the destruction mechanisms implemented by Tezos?
Tezos has implemented several destruction mechanisms, including creating new accounts or smart contracts, allocating additional smart contract storage, and deleting validator errors.
3. What caused the decline in new accounts during the first quarter of 2023?
The decline in new accounts during the first quarter of 2023 was largely due to the casting of Manchester United NFT in the fourth quarter of 2022.