Active User Growth

Definition ∞ Active user growth refers to an increase in the number of distinct participants regularly interacting with a blockchain network or decentralized application. This metric indicates expanding adoption and utility within the digital asset ecosystem. It measures the sustained engagement of individuals or entities with a protocol, often observed through on-chain transactions or specific application usage. A rising count of active addresses or unique wallet interactions signifies genuine expansion and network health.
Context ∞ The state of active user growth is a primary indicator for assessing the vitality and future prospects of a cryptocurrency project or decentralized platform. Analysts frequently examine this metric to determine if a digital asset’s valuation is supported by genuine utility and expanding community participation. Sustained growth signals robust demand and potential for long-term value accrual, while stagnation or decline may indicate diminishing interest or functional limitations. Monitoring these trends provides critical insight into market sentiment and underlying project strength.