Take Etherscan as an example to uncover the benefits of blockchain browsers

23-03-27 13:31
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Original title: Unlocking Etherscan: The Business Behind the $10 Million a Year Blockchain Browser
Original article by Launchy Deep Tide TechFlow


Etherscan, a tool that helps users navigate the Ethereum blockchain, more commonly known as the blockchain browser, receives 80 million visits a month. Etherscan has long been one of the most popular and widely used tools in the cryptocurrency space.


With Etherscan, users can easily analyze block transactions on the Ethereum blockchain. Through the platform, everyone will be able to enjoy one of the core tenets of blockchain technology: transparency. From detectives investigating suspicious Rug activity on the chain to traders monitoring large-scale money flows, Etherscan gives us the tools necessary to better understand what's going on behind the scenes in blocks.


Etherscan has no Token. While it operates at the core of the encrypted Web3.0 ecosystem, Etherscan is considered more of a "traditional SaaS business" and not a fully localized blockchain application. It simply gives users the tools to better understand blockchain transactions.


Since its founding in 2015, Etherscan has become the blockchain browser of choice. By 2023, Etherscan had expanded to more than 18 blockchains.



解密 Etherscan:年赚千万美元,区块链浏览器背后的生意经


How does Etherscan make money?


Etherscan, like many other software companies,Generate revenue by providing services. Etherscan is primarily a B2C business, although it also offers some B2B products. However,Advertising became an important factor in Etherscan's revenue.


On a higher level, Etherscan generates revenue from:


SaaS:Etherscan provides SaaS services primarily for B2B, such as building block Browser as a Service (which they call EaaS).


API plan:Etherscan offers API plans to access its data for prices ranging from free to $399 per month, with undisclosed enterprise pricing.


Advertising:Etherscan has five types of ads. More on this below.


On-chain service:We found that one of Etherscan's products, BSCscan, provides a delegation service, and Etherscan is working on other on-chain tools, including wallet-to-wallet messaging, Token authorization revocation tools, and more.


Donate:That's easy. The platform allows users to donate money to support its development and maintenance.


解密 Etherscan:年赚千万美元,区块链浏览器背后的生意经


Let's do some revenue estimates.


Newsletter: $120,000 to $300,000 a year


If Etherscan has 1 million subscribers, it can charge between $20,000 and $50,000 per newsletter, depending on CPM. Since this newsletter is not a "core" business and we are not talking about open rates, we assume a 50% discount on the price.


Etherscan charges between $10,000 and $25,000 per newsletter (it publishes one newsletter per month). Overall, they can earn between $10,000 and $25,000 a month from the newsletter.


Website advertising: $3.2 million to $8.64 million per year


There are four types of website ads, including homepage banner ads, banner ads, header text ads, and button ads.


To be honest, this income is heavily dependent on how Etherscan decides to monetize it. As the following example shows, it depends on the industry area, the method of liquidation, and the state of the industry


解密 Etherscan:年赚千万美元,区块链浏览器背后的生意经


Estimating AD revenue based on Web traffic is tricky because it varies widely by industry, sector, and geography. For a background, it can range from $0.10 to $50 per 1,000 views.


The super common formula is: Monthly traffic /1000 x RPM.


RPM ranges from about $15 per 1,000 displays to $100 in certain areas such as real estate insurance. Let's assume the RPMS for cryptocurrencies are between $30- $50.

Using extremely rough estimates, I predict that Etherscan's ability to commercialize, as well as having 4 different AD placements and higher RPM rates for cryptocurrencies will bring Etherscan:


80 million page views per month. According to Playwire, 10 million page views should net at least $25,000 a month. At that rate, Etherscan should net $200,000 a month.


8 million unique visitors per month. According to the above Quora source, 500,000 unique views in the gaming space can net $45,000 a month. At that rate, Etherscan should net $720,000 a month (assuming the cryptocurrency is comparable to RPMS in gaming).


API initiatives, on-chain services, and SaaS: $2.91 million to $12.55 million per year.


If we assume that Etherscan can convert the following percentage of unique visitors (8 million) into buyers at the lowest price ($199 / month) :


0.1% 8,000 customers pay $199 / month $1.91M/year.

0.5% 40,000 customers pay $199 / month $9.55M/year.


As for Etherscan's Explorer-as-a-Service (EaaS), it's more of a one-off deal (perhaps with some margin charges). Most of the on-chain services, Token authorization and block scanning chat listed on the site are still in beta.


As a result, we estimate that annual revenue will be in the low seven-figure range ($1 million to $3 million).


Headcount and expenditure


Etherscan has 29 employees, according to LinkedIn. LinkedIn breaks down the top five "departments" as follows:


Engineering - 12 people

Business Development - 8 people

Operation - 4 people

Community and Social Services - 3 people

Information Technology - 2 people


Let's create a scenario to estimate how much money Etherscan would spend on each of the five departments above:


Project:In the $100,000 to $200,000 range, Etherscan pays $1.2 million to $2.4 million a year.


Business development:In the $80,000 to $120,000 range, Etherscan pays $640,000 to $960,000 a year.


operation: In the $70,000 to $100,000 range, Etherscan pays $280,000 to $400,000 a year.


Community and social services:In the $60,000 to $90,000 range, Etherscan pays $180,000 to $270,000 a year.


Information Technology:In the $100,000 to $150,000 range, Etherscan pays $200,000 to $300,000 a year.


Overall, Etherscan costs $2.5 million to $4.33 million per year for each of the five divisions.


But, importantly, Etherscan operates out of Malaysia -- which would significantly reduce the wage bill. A more realistic assumption is to halve annual headcount spending, to between $1.25 million and $2.15 million a year.


As usual, this figure is only the first estimate of spending. It does not include other operating costs, such as third-party vendors, office space, etc.


income


Our estimates yielded the following results:


Etherscan revenue: $6.23 million to $21.49 million per year.


$120,000 to $300,000 a year for newsletters;


Website advertising $3.2 million to $8.64 million annually;


$2.91 million to $12.55 million per year for API initiatives, on-chain services and B2B SaaS;


Etherscan payout: $1.25 million to $4.33 million per year.


Our rough estimate is:


Minimum gross profit of $1.9 million ($6.23 million - $4.33 million);


The highest gross profit was $20.24 million (21.49 million - 1.25 million).


What's the next step?


For Etherscan, insight into the business makes perfect sense.


They own all the blockchain data and can launch products like Dune Control panels or Nansen's wallet markers. This seems to be a way for Etherscan to expand verticals with relative ease without having to invest a lot of resources.


The fact that Etherscan didn't capitalize on this trend suggests that they were already very profitable in the areas they conquered (raw blockchain data) and brands (website traffic/AD revenue).


Etherscan is in a good place. They are not in the US and have not launched any tokens. As the blockchain ecosystem matures, let's wait to see how the undisputed king of block browsers enters the market.


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