Hedera Network (HBAR) Q1 2025 Key Insights

Hedera (HBAR) is a high-performance, secure, and sustainable public, permissioned distributed ledger (DLT) network.

Key Insights

Primer

Founded in 2015 and launched in March 2022, the Hedera Network is a high-performance, secure, and sustainable public, permissioned distributed ledger (DPL) network. It is governed by a council of up to 39 of the world’s leading institutions, with community input on the network’s features and ecosystem standards provided through Hedera Improvement Proposals (HIPs). While anyone can submit a transaction and view the network history and data, only pre-approved entities run the nodes that validate transactions and participate in consensus.

The network is governed by a council of 39 members, who rotate on a yearly basis. Community members can also contribute to the development of the network through various programs and initiatives. Together, they will decide on the future of the Hedera Network and its role in the Web3 ecosystem.

Network Overview

Usage

New accounts on the Hedera Network grew 6% quarter-over-quarter (Q4 2024: 7,800). The majority of new accounts were opened in Q1. However, daily average active accounts decreased 33% QoQ from 10,100 to 6,700.

After a 99.6% decrease in Q4, average daily transactions rose 25.8% QoQ from 563,200 to 708,500. Transaction activity is now more evenly distributed across all of Hedera’s network services. The percentage share of average daily transactions for each service is as follows:

The decline in Hedera’s Consensus Service transactions can largely be attributed to Avery Dennison's atma.io platform ceasing use of Hedera’s Consensus Service. As reported by Messari previously, atma.io represented the majority of transactions on Hedera.

At the end of Q1, 15.9 billion HBAR was staked (-23.0% QoQ), which is 37.7% of the circulating and 31.9% of the total supply. This high percentage of the circulating supply being staked is attributed to entities such as Hashgraph, who are allocating their HBAR to be staked, and the Hedera Treasury, which assists validators in meeting the minimum staking threshold to participate in network consensus. It’s worth mentioning that these entities have chosen not to collect staking rewards. As of Q1 close, 63.1% of staked HBAR do not receive rewards.

Hedera Network staking data was unavailable between January 29, 2025, and February 19, 2025. During this period of time, the total amount of HBAR staked decreased by 22.3%. Most of the withdrawn HBAR belonged to the ‘no-rewards’ category of staking, which decreased by 4.5 billion HBAR (30.5% of the no-rewards staked supply). The ‘rewards’ category of staking remained relatively unchanged, declining only 1.7% during this period.

Development

After remaining relatively stagnant throughout 2024, daily average active contracts saw a significant increase in Q1, growing 213.3% from 200 to 600. Moreover, Active contracts reached an all-time high of 6,300 on March 28, 2025.

Throughout the quarter, Hedera has actively introduced improvements for various developer-focused tools and products via several Hedera Improvement Proposals (HIPs). Some notable HIPs include HIP-755, HIP-756, and HIP-991, which are discussed in more detail below.

Enhanced Smart Contract Capabilities

On March 26, 2025, Hedera upgraded its smart contract functionalities with the introduction of two Hedera Improvement Proposals—HIP-755 and HIP-756—as part of its mainnet release 0.59.

Announced in December 2024, HIP-755 enables smart contracts to directly handle scheduled transactions within the Hedera Smart Contract Service (HSCS). This allows for the autonomous execution of more complex transactions, which can include tasks like schedule authorizations, signature management, and generation of synthetic transaction confirmations.

Complementing this is HIP-756, which introduced the capability for smart contracts to initiate scheduled token creation and manage coordinated account roles—e.g., treasury accounts—from the contract logic. This capability simplifies complex multi-party workflows and reduces operational dependencies for Hedera’s smart contracts.

Monetization and Access Control in Hedera Consensus Service

Announced in February 2025, HIP-991 brings new functionality to the Hedera Consensus Service (HCS). This proposal enables the creation of an optional fee for HCS messages that affect a