Definition ∞ Network utility refers to the intrinsic value derived from the use and participation within a specific blockchain network. This value is generated through the network’s ability to facilitate transactions, support decentralized applications, enable smart contract execution, or provide other functional services. High network utility typically correlates with increased demand for the network’s native token, which is often required to access these services.
Context ∞ The concept of network utility is central to assessing the fundamental value proposition of many blockchain protocols. Current discussions often involve analyzing the transaction volume, developer activity, and the diversity of applications built on a network as indicators of its utility. Future assessments will likely scrutinize how effectively networks can sustain and grow their utility in the face of increasing competition and technological evolution.
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