[Note: This was originally published on September 25, 2014 at Melotic.com]

While much attention has been given to theoretical transactions per second (TPS) for various blockchains, in practice the transaction per minute (TPM) may be a more interesting measure of actual consumer behavior. For example, in the past week the average range for TPM has been:

• Bitcoin: 38-48 TPM
• Litecoin: 2-3 TPM
• Dogecoin: 37-40 TPM
• Source: SoChain

Yet, not all TPM is equal. For instance, while self-reported numbers from payment processors suggest that there is between $2 – $4 million in commercial transactions per day, the transaction volume also includes:

• Mining rewards
• Gambling, mixing (sending to burner wallets) and illicit activities
• Trading on exchanges

Without a full traffic analysis, such as the kind performed by Meiklejohn last year, the percentages of each use-case are difficult to estimate though it is likely that neither Litecoin nor Dogecoin support the same volume of commerce as Bitcoin currently does. Similarly, off-chain transactions in the form of FOREX – the buying and selling of bitcoins and litecoins in bulk through liquidity providers such as Buttercoin and Vaurum – exists in a nebulous area; is FOREX really commerce like other value transactions (e.g., exchange of houses, cars, clothing, etc.)? This is a topic for future research.

In the meantime, what lessons can altcoin designers take away from this one data point?

For instance, why has Litecoin’s userbase remained relatively flat?

• It has different community dynamics than Dogecoin and like all coins faces uphill institutional inertia of Bitcoin. That is to say, while other large Bitcoin-focused companies could – from a technical standpoint – integrate support for Litecoin or other alts, they choose not to due to a variety of factors (e.g., perception, branding, etc.).

Why has Dogecoin succeeded at getting this far?

• If cryptocurrencies are a startup, traction channels are key. In his new book, Traction, Gabriel Weinberg described 19 different traction channels that startups can target for new user growth. In short, Dogecoin utilized new traction channels to market (e.g., guerilla marketing via a NASCAR sponsorship and Jamaican bobsled sponsorship) whereas the Bitcoin and Litecoin communities have largely saturated its traction segments (e.g. handful of social media channels).

Opportunities and challenges of relying on other chains

Earlier this year, starting in January, the Counterparty development team held a “proof-of-burn” period for 30 days. During this time, bitcoin holders could send bitcoins to a provably unspendable address, a terminal address which did not have a corresponding private key. In return, the user was sent a new coin called XCP which would enable the user to have access to the Counterparty network – so that they could issue new assets through the Counterparty system. 2,130 bitcoins were “burned” during this period which amounted for 0.01% of the monetary base of bitcoin at that time.

Nearly 8 months later, a new project attempted to do the same process: Dogeparty. Using a fork of Counterparty but placed on top of the Dogecoin network (instead of the Bitcoin) network, the Dogeparty team began its “proof of burn” phase on August 14. It lasted for 28 days and by the end of September 11, roughly 1.85 billion dogecoins were “burned.” This was roughly equivalent to 2.01% of Dogecoin’s monetary base at that time.

What does this look like visually?

Above is a chart that illustrates the transactional volume of the Dogecoin network. The two black vertical bars represent the begging and end of the “burn” phase for dogeparty.

One would think that moving 2% of the monetary base in a 28-day period would result in a more pronounced visual (e.g., a steep linear increase) but this again, shows the difficulty in fingerprinting and doing forensics on the blockchain: without a full traffic analysis it is difficult to distinguish mining rewards, gambling, mixing, commerce and coins being “burned.”

A final statistic that may be of interest to readers is that Counterparty transactions have grown significantly over the past 8 months and as of September 17, 2014 accounted for 3% of the Bitcoin transaction volume (XCP 2,499 versus BTC 79,784).