On-chain analysis measures network activity such as transfers, balances and fees. Metrics depend on definitions and labels. A single person can use many addresses, and an exchange address can represent many customers.
Movements between labeled wallets do not automatically indicate a buy or sell. Check how a provider builds its dataset and whether labels were known at the time. Combine on-chain observations with market structure instead of treating one metric as a trading signal.
Worked example
An exchange moves assets from one internal wallet to another. Transfer volume increases without a corresponding customer trade.
Check your understanding
Why can active-address counts overstate user growth?
Show explanation
One user can control multiple addresses, and automated or internal activity can inflate the count.
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