Messari's latest "State of Hedera Q4 2024" report highlights a remarkable turnaround for HBAR, with its circulating market capitalization rebounding 375% quarter-over-quarter
Messari's latest report, "State of Hedera Q4 2024," provides a comprehensive overview of Hedera's performance in the fourth quarter. Here are the key takeaways:
* 375% Circulating Market Cap Recovery: After hitting bottom in Q1 2024 at $2.2 billion, HBAR's circulating market capitalization experienced a remarkable recovery, rising to $10.3 billion by Q4 2024. This rally propelled HBAR to 18th position from 46th among cryptoassets and saw the price of HBAR surge 367% to $0.27. The market optimism following the U.S. presidential election also contributed to this rally.
* Slowing Rate of Circulating Supply Increase: While the circulating supply of HBAR increased to 38.3 billion, the rate of increase slowed quarter-over-quarter, growing by only 1.7%. This aligns with the network's distribution plan, which projects another 3.9 billion HBAR to be introduced into circulation in Q1 2025. The majority of this new supply, over 3.6 billion HBAR, will be allocated to ecosystem development and open-source initiatives.
* Declining Network Revenue Despite Expansion: Despite the significant increase in market cap, Hedera's network revenue experienced a sharp decline, with overall transaction fee earnings reaching a yearly low of 2.1 million HBAR. This is a staggering 92% quarter-on-quarter decline that translates to an 85% dollar-denominated revenue decline to $239,800 for the quarter.
* Major Transaction Contributors Wind Down: The revenue reduction was largely due to a significant reduction in the Hedera Consensus Service, which had a 99% decline in earnings. The other network services also registered decreases: Hedera Token Service revenue fell by 51%, while Crypto Service had a 38% reduction. However, the Smart Contract Service saw a 22% boost in revenue to 980,900 HBAR. These declines were mostly caused by Avery Dennison's atma.io platform discontinuing its use of the Consensus Service, as it was a significant contributor to transaction volume on the network.
* Crypto Service Transactions Take the Lead: Hedera's network activity showed contrasting trends in Q4. New accounts decreased 10% quarter-over-quarter, while active accounts increased 24% to 10,100. Transactions experienced a steep decline, with daily volume dropping to 563,000 from 153 million, a 99% decrease in Hedera Consensus Service transactions. Nevertheless, transaction volume was more evenly distributed among various network services, with Crypto Service handling the greatest share at 39.1%.
* Staking Remains High, But Most Tokens Not Earning Rewards: At the close of Q4, 20.6 billion HBAR remained staked, representing 54% of circulating supply. The majority of this staking is attributed to key players like Hashgraph and the Hedera Treasury, who continue to participate in network validation without claiming staking rewards. Notably, 72% of staked HBAR does not earn any reward, highlighting a unique staking paradigm within the ecosystem. In the meantime, smart contract development gained momentum with a 26% increase in daily active contracts to a year-to-date high and a 116% year-over-year growth.
