HBAR made big moves in late 2024. Its market cap jumped 375% quarter-over-quarter. That rise pushed Hedera from the 46th to the 18th spot in global crypto rankings. The surge surprised analysts and placed HBAR above several major altcoins. Investors took notice.
The price of HBAR rose 367%, reaching $0.27. This increase came as crypto markets responded to changing sentiment. The U.S. presidential election brought new policies, favorable to blockchain development. Market participants viewed Hedera as one of the main winners.
Institutional interest grew. Many saw Hedera as a reliable Layer 1 platform with long-term utility. Developers praised its fast finality and low transaction costs. Traders entered the market to catch the wave. The combined momentum lifted Hedera’s visibility and boosted token demand.
Social media trends added fuel. Posts about HBAR went viral on platforms like X and Reddit. Influencers and analysts posted bullish charts. Retail investors followed. Trading volumes spiked. Short-term buyers rushed in, helping drive prices higher.
Despite the price spike, Hedera faced major setbacks. Network revenue dropped 92% in Q4. That drop shocked many in the ecosystem. One of the fastest-growing tokens had failed to support its growth with real network income. That raised questions among developers, users, and investors.
If the price soared, why did the platform earn less? Could Hedera sustain growth without strong transaction fees? Would developers stay loyal? These concerns sparked debate across the crypto space.
This article breaks it down. We will look at the reasons behind the market cap growth, the fall in network activity, and what makes HBAR’s staking system stand out in 2025.
What Drove HBAR’s Sudden Rise?
Messari’s “State of Hedera Q4 2024” report shows a dramatic jump in HBAR’s value. The market cap soared from $2.2 billion to $10.3 billion in just three months. That increase pushed Hedera into the top 20, placing it ahead of many well-known projects.
Several key factors fueled the rise.
First, the broader crypto market began to recover after the U.S. elections. Investors expected favorable policies toward digital assets. Market sentiment turned bullish. Many looked for platforms with strong fundamentals. Hedera stood out with its enterprise-grade tools and long-term roadmap.
Second, developers returned to Hedera. The platform gained traction for its smart contract features. Low fees, strong security, and fast transaction speeds made it attractive. New dApps entered the pipeline. Builders saw Hedera as a stable home for real-world applications.
Third, Hedera provided a clear growth strategy. It stayed focused on ecosystem development and open-source contributions. The team followed a steady plan and released updates on time. That built trust among users and investors.
HBAR’s circulating supply reached 38.3 billion tokens. The growth rate slowed, rising only 1.7% from the previous quarter. Another 3.9 billion HBAR is expected in Q1 2025. Over 3.6 billion of that will fund ecosystem grants and developer programs.
This supply control helped the rally. Investors saw Hedera’s steady token release as a sign of discipline. They viewed the long-term allocation as a strength, not a threat. Confidence grew. That trust played a key role in the price surge.
The combination of market optimism, renewed developer interest, and careful supply management created the perfect storm. HBAR rose fast—and the market noticed.
Why Did Hedera’s Revenue Collapse?
Despite price growth, Hedera’s revenue took a deep hit. Total earnings fell to 2.1 million HBAR in Q4. That marks a 92% drop in network revenue and an 85% decline in dollar terms.
The biggest issue came from the Hedera Consensus Service. It saw a 99% drop in usage. That service once powered millions of daily transactions. Now it plays a minor role.
The drop was tied to key users leaving. Avery Dennison’s atma.io platform stopped using Hedera. That alone triggered a sharp decline in transactions and income.
Other services also struggled:
Token Service revenue fell 51%
Crypto Service earnings dropped 38%
Only one bright spot remained. The Smart Contract Service grew 22% in revenue. This shows developers still see Hedera as a useful platform for contract deployment.
What’s Going On With Hedera’s Transaction Volume?
Hedera saw a massive drop in transaction volume during Q4 2024. Daily transactions fell to 563,000 from 153 million. That marked a stunning 99% decline. The plunge reduced network visibility and slowed overall engagement.
The sharp fall came after the exit of key users. Platforms like Avery Dennison’s atma.io, which once generated heavy traffic, left the network. Their departure left a major gap. The Hedera Consensus Service, once the top source of transaction fees, lost nearly all activity.
New account creation slowed as well. The network recorded a 10% decline in new accounts. That showed less interest from fresh users. But there was a bright spot. Active accounts rose 24%, reaching 10,100. That points to a strong and loyal user base. These users kept using Hedera even during low-traffic periods.
Crypto Service took the lead among Hedera’s core offerings. It handled 39.1% of all transactions. This shift shows a move away from the old transaction-heavy use cases. Users now interact more with wallet functions and token transfers.
Other services did not fare as well. The Token Service and Consensus Service both saw major declines. Smart Contract activity held steady, but it did not offset the losses.
The numbers reveal a clear trend. Hedera lost volume from bulk-use clients but gained traction among active, loyal users. To recover, the platform must attract new high-volume applications and rebuild demand across all services.
Is Hedera’s Staking Model Broken or Brilliant?
Staking levels stayed high. Over 20.6 billion HBAR remained staked by the end of Q4. That’s 54% of the circulating supply. Most of it came from key players like Hashgraph and the Hedera Treasury.
Here’s the twist: 72% of all staked HBAR earns no reward.
This unusual setup reflects Hedera’s mission-driven approach. Major backers stake to support the network. They do not claim profit. This creates a stable base, though it leaves little incentive for everyday users.
Some view this as a risk. Others see it as proof of commitment. Either way, it sets Hedera apart from networks that rely on high staking rewards to keep users engaged.
Are Developers Still Building on Hedera?
Yes. Developers have not turned away from Hedera. In fact, development activity shows strong growth.
Daily active smart contracts rose 26% in Q4. That points to steady usage across new and existing projects. Year-over-year growth reached 116%, confirming long-term momentum. These gains came even as total transaction volume dropped.
Many developers still trust Hedera. They see it as a scalable platform with low fees and fast confirmation times. The network’s design appeals to enterprise teams. It supports real-world use cases that demand reliability, not hype.
Smart contracts on Hedera offer flexible options. Developers can build apps that serve finance, identity, supply chain, and more. They can also count on strong uptime and a consistent roadmap. These traits draw teams that want stability over noise.
The growth in contract deployment shows real builder interest. Hedera may not lead in social buzz or meme coins. But it holds a solid spot among platforms built for business. That base gives Hedera lasting value even during market swings.
Despite lower traffic, development remains active. Builders keep showing up. That helps position Hedera for a stronger recovery and more real-world use in 2025.
What Next for HBAR?
HBAR’s price climb impressed investors. Its revenue collapse shocked analysts. Its staking model still sparks debate. The mixed signals create an unclear future.
Hedera must fix the service gaps that caused the revenue drop. It must also attract new users to replace the big clients it lost.
But there is hope. The rise in contract activity shows that builders still believe in the project. Hedera still holds a strong place in crypto infrastructure, even with fewer transactions and earnings.
As Q2 2025 begins, the key questions are:
Will Hedera regain its lost clients?
Can the network boost transaction fees again?
Will the staking model evolve to reward more users?
HBAR now sits at a crossroads. It could build on its price momentum. It could also fade if key issues go unsolved.
One thing is clear—Hedera’s story is far from over. Investors should watch closely.
Final Thought
HBAR’s performance in Q4 2024 shows how fast things can shift in crypto. A 375% rise in market cap shocked investors. A 92% drop in network revenue stunned them just as quickly. The gains and losses came back-to-back, leaving the market unsure what to expect next.
Despite the drop in earnings, Hedera still holds a strong foundation. The platform saw growth in smart contract activity. Developers stayed committed. Its staking model, though unusual, continues to provide network stability. Few projects maintain such a loyal builder base during downtrends.
But Hedera must act. The network needs to replace lost volume, rebuild revenue streams, and prove that high token value can match real utility. Price alone will not drive long-term success.
HBAR may continue to rank high in 2025. Its future depends on user adoption, platform rewards, and steady revenue growth. If Hedera executes well, it could become a leading infrastructure layer in the next crypto cycle.
The next few quarters will be critical. They will reveal if Hedera can turn strong development into sustained value—or lose its momentum in a fast-moving market.