While the number of daily active addresses on the Ethereum (ETH) network surpassed the 1 million mark, outpacing layer-2 networks due to falling transaction fees, it has emerged that this increase was driven by fraudulent methods known as address poisoning.
The smart contract platform Ethereum (ETH) has recently experienced a significant surge in network activity, outpacing its own sidechains and scaling solutions. According to Token Terminal data, the number of daily active addresses rose to 1.3 million in mid-January, before stabilizing around 950,000. This development reversed the perception that users were permanently leaving the mainnet, overshadowing the transaction traffic of popular networks like Arbitrum (ARB), Base, and OP Mainnet (OP).
This resurgence is fundamentally driven by the Fusaka update implemented in December. This update significantly reduced transaction fees, making it economically feasible for users to transact directly on the Ethereum mainnet again. The reduction in costs, particularly for stablecoins, the most commonly used for daily transfers, boosted on-chain data. However, experts warn that low transaction fees are attracting not only legitimate users but also malicious actors to the network.
Is Address Poisoning Misleading Data?
A significant portion of this record surge on the Ethereum network is attributed to a type of attack known as address poisoning. Security researchers found that at the beginning of January, the number of newly created addresses reached 2.7 million, a 170% increase above normal levels. The fact that approximately two-thirds of these new addresses had very low-value initial transactions suggests that a significant portion of the network traffic is artificial. This is similar to spam calls filling your call log but without any actual conversation.
Scammers' New Method: Powder Transfers
Scammers create fake addresses that closely resemble victims' wallet addresses and send small amounts of powder transfers, often under $1. When users check their transaction history, they might mistake these fake addresses for their own, copy them, and inadvertently send funds to the attackers. So far, losses exceeding $740,000 have been confirmed using this method, with low transaction fees making such attacks less costly. As a result, while Ethereum usage has increased, it's important to remember that some of this increase is due to malicious activity.
