Transaction Velocity

Definition ∞ Transaction velocity measures the rate at which a unit of cryptocurrency is exchanged for goods or services over a given period. It indicates how frequently a digital asset changes hands within the economy, providing insights into its use as a medium of exchange. A higher velocity suggests more active usage for transactions.
Context ∞ Transaction velocity is a key economic indicator used to assess the activity and utility of different digital assets. Analysts monitor changes in velocity to gauge adoption trends and understand the flow of value within the cryptocurrency ecosystem. News reports may reference this metric when discussing the economic activity surrounding specific cryptocurrencies or blockchain networks.