With little in the way of fundamental metrics for investors to latch on to, sentiment and other softer factors are often considered.
However, strong active wallet and transaction growth on this network have indicated that users are flocking to Aptos as a go-to Layer-1 blockchain.
Here's what to make of this move in this volatile crypto market.
I'd argue that time frame matters a great deal to investors looking to assess how a given stock or cryptocurrency is performing. The standard advice to "zoom out" in reference to near-term spikes or plunges in asset values is important, particularly in the context of looking at surging tokens such as Aptos (CRYPTO: APT), which was up 15.1% over the past 24 hours, as of 12 p.m. ET. Friday.
The move has certainly reinvigorated some investors in this name who may have felt that the market has left them for dead. For others who have had this token on their watch lists for a long time (such as myself), the question is whether this rally may have the momentum to continue, and if it should be bought.
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Let's dive into what's driving this move in the Layer-1 smart contract enabled network.
Image source: Getty Images.
In the world of crypto investing, forming an investing thesis around a particular token typically involves assessing investor sentiment, technicals, and other factors I don't really deem valid as long-term barometers of how a project will grow over time.
However, there are some fundamentals to look at, from active wallets to transactions and other activity on a given blockchain, which can tell a more compelling story.
On this front, Aptos has seen a surge of active wallets on its network, with more than 1.8 million such active addresses resulting in a doubling of this metric over the past month. Additionally, daily transactions have remained strong (around 1.7 million of late), suggesting that developers and users are flocking to Aptos' blockchain network for its decentralized applications.
If these sorts of fundamentals continue in the right direction, and we see a surge in total value locked to more than $1 billion (a key metric according to some analysts in this space), it could be off to the races for this project. We'll see.
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Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aptos. The Motley Fool has a disclosure policy.