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How to Track On-Chain Transactions

How to Track On-Chain Transactions

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Written by Alchemy

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Reviewed by Brady Werkheiser

Published on 2023-05-114 min read

Every day, millions of crypto transactions are conducted on-chain. These include DEX trades, loans, NFT mints, options contracts, liquidity adds and much more. Each transaction (txn) creates a permanent record that can be viewed in real-time in a block explorer. As a result, with a little practice, and the right set of tools, it’s possible to work out what, where and how every wallet is trading in web3.

What on-chain analytics solves

Txn details can be extremely valuable, particularly in the case of whales who use “vanity” addresses like bigtrader.eth, making it easy to correlate wallet with user. Armed with only the wallet address or .eth of an influencer, you can copy their trades and mimic their NFT buys – or even counter-trade them if you’re feeling bold.

While it’s theoretically possible to track blockchain activity using only a block explorer, this method is wildly impractical. Block explorers are not designed for mass monitoring and deciphering of transactions. Take this example, for an Arbitrum txn. Do you understand what happened here?

How about now, using a blockchain explorer that breaks down the flow of funds? It’s still tricky. Unless you’re an expert, peering into the tea leaves that flavor an on-chain txn will leave you scratching your head.

What is on-chain analytics

Analytics dashboards exist to solve this problem, and help users make sense of the transactions that make up web3. These demystify exactly what’s happening on-chain, making it easier to comprehend txns and draw actionable insights. With on-chain analytics, not only can you see what’s happening – you can use this information to your advantage.

That, in a nutshell, is what on-chain analytics delivers. It’s an extremely powerful tool that democratizes access to valuable information. But like any tool, you only get out what you put into it. The time spent learning your way around an analytics platform will pay dividends.

How on-chain analytics works

On-Chain analytics is an emerging industry that tries to make sense of the millions of transactions that are made on crypto networks every day. Most of these txns are of little interest to the casual onlooker, but a few are very precious. Examples of noteworthy transactions include:

  • Stablecoins sent to your personal wallet as payment from an employer

  • A new NFT collection minted by a successful NFT trader

  • A low cap altcoin purchased by a YouTube influencer

  • A leveraged long position opened by an experienced futures trader

  • A new protocol being used on a layer2 network you’re interested in

  • A whale sending millions of dollars to a CEX

  • A flash loan exploit being executed against a DeFi protocol

  • A hacker moving funds to a new wallet

On-Chain tracking tools such as Cielo provide a way to follow the money, watch the whales, track the hackers, and keep tabs on your own portfolio. Other tools like Alchemy’s Custom Webhooks allow you to stream the most recent blockchain data to find out about specific events you may care about.

Just as search engines help us make sense of the web, through decoding and aggregating disparate data sources, the same is true of on-chain analytics. Part search engine, part social news feed, an on-chain dashboard forms your window into the world of DeFi, NFTs, and every other crypto use case that can be executed on a public blockchain.

What differentiates an analytics platform from a conventional block explorer?

While the features will vary from one service to the next, a good on-chain tracker will provide the following:


To follow wallets, first you need to find them. On-chain analytics platforms use a variety of tools, including pre-made lists of DeFi power users, that provide a foundation for txn tracking.


This makes it easier to identify the protocol being used, the token being swapped, and the type of trade e.g. buy, sell, borrow, lend, mint, sweep, open, close.


Tools for screening out transactions that are irrelevant to your interests, allowing you to zero in on a particular network, protocol, txn type, or position size.


On-chain transactions occur at a particular point in time. Understanding them calls for viewing them alongside adjacent txns to build a picture of what the user is doing. A news feed allows you to view txns in chronological order, displayed in near-real-time.


By aggregating the data that passes through their APIs, on-chain readers can provide a holistic view of the most popular protocols, networks, trends, and tx types. This provides an insight into which ecosystems are on the rise and reveals the current mood of the market.

Why on-Chain analytics matters

At a high level, it’s easy to grasp why on-chain analytics tools are useful. Billions of dollars are traded on-chain every day, and each of these txns provides a window into the thinking and strategy of its executor. Through analyzing the behavior of the best traders – or “smart money” as they’re known – it’s possible to identify opportunities before the rest of the market has caught on.

Whether it’s longing ETH ahead of a major protocol upgrade, minting a new NFT collection before it sells out, or identifying the latest yield farm before its native token moons, on-chain analytics has the answer. But the answers it serves up are only as good as its inputs. Fill your on-chain dashboard with expert wallets and you’ll fare better than a feed containing only amateur wallets.

On-chain discovery isn’t a magic bullet for profitability

It's worth noting that there’s just as much chance of a wallet you copy being wrong as there is of it being right. Provided you are aware of these limitations, however, a good on-chain reader acts like a torch on a dark night, illuminating the wealth of opportunities that crypto presents every single day.

You can’t catch all of them; even with an on-chain dashboard plugged into the smartest wallets in DeFi, you’ll do well to capitalize on 1% of the setups that materialize.

But when you do take the plunge, you’ll wonder how you ever operated without the clarity provided by an on-chain analytics platform. Once you wallet track, you’ll never look back.

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