Market depth, to put it simply, is when you invest a large amount of money into an asset, and the price doesn't fluctuate wildly. This is a core indicator of whether a market is mature and has sufficient liquidity. Fortunately, the transparency inherent in blockchain technology provides us with a wealth of real data—no need to guess, just look at on-chain metrics to understand the market's true state.

To determine whether market depth is increasing, focus on a few key numbers: network activity, genuine movements of holders, and the flow of assets on the chain.

**First, look at basic network activity—this is the foundation of everything**

The number of daily active addresses is an intuitive signal. Simply put, how many unique accounts are actively transacting on the chain each day reflects genuine user participation. In a healthy market, this number should steadily grow or stay high. For example, mid-year data shows that the Solana network has an average of 4.8 million active addresses per day, firmly at the top among public chains; Base chain follows closely with 1.71 million daily, both clearly outperforming others. Bitcoin's active address count has remained relatively stable, but what’s truly important is its trend—if the price surges and active addresses also increase, it indicates the rise is driven by real demand; conversely, if the price skyrockets but addresses stagnate, it’s likely a bubble, and caution is advised.

**Next, look at the scale of trading activity—quantity is only superficial**

How many transactions occur daily, and what is the average value per transaction? These metrics reveal the real economic vitality of the blockchain. Increasing market depth isn't just about stacking transaction counts; the key is the transaction volume. From on-chain data mid-year, although Bitcoin's daily transaction count is substantial, the true measure of liquidity depth is the scale of value transfer.