Despite the pessimism of impending crypto winter, DappRadar, the world’s largest dapp store, has released its Q2 Dapp Industry Report, highlighting the positive impact of NFTs and GameFi on the future of dapps.
The report sheds insight on how the dapp market has taken the burden of the current financial crisis. As a result, just 1.78 million unique active wallets (UAW) interacted daily with blockchain-based applications in July. This is the first time since September 2021 that UAW has failed to reach the 2 million mark in a month. Blockchain dapps attracted 2.11 million UAW members in Q2, a decrease of 11 percent from the previous quarter. On the plus side, that’s still a 62% increase over the same period last year.
During this crypto winter, which has seen most cryptocurrency assets drop by 70% or more from their all-time high prices, dapp activity has been severely curtailed. Third Arrow Capital, Celsius, BlockFi and Voyager were all hit by substantial liquidity concerns during this second quarter. The collapse of the Terra ecosystem was a significant contributor to these troubles.
For the first time since January 2021, the crypto sector fell below $1 trillion in total value locked, losing 34% of its worth due to Terra’s demise, according to the DappRadar Q2 Dapp Industry Report. It also examines the liquidity constraint in several top CeFi dapps and how this supports the argument for self-custody of crypto assets. In addition, it shows the industry’s persistent security worries after hackers stole over $676 million in crypto assets in the second quarter.
According to this analysis, there are many reasons to be optimistic about this business despite all gloom and doom. It’s worth noting that although Ethereum NFT trading volumes fell by 40% from the previous quarter, sales counts jumped by 20% simultaneously, showing that demand for digital assets has grown since then. Ethereum’s competitors also had a few shining moments. For example, Solana NFT trade value increased 23 percent in volume while trading value doubled from the first quarter.
In addition, several blue-chip NFT collections have held their value and made a solid argument for themselves as a safer investment than typical crypto assets in the face of the recent collapse in the crypto market. A 7 percent increase in market capitalization for the top 100 Ethereum NFT collections coincided with a 72 percent decline in the value of Ethereum (ETH) in US dollars during the third quarter.
Another encouraging conclusion from the research is the blockchain gaming industry’s resiliency. While UAW in the dapp business fell by 26% in the third quarter, the UAW in blockchain gaming only fell by 5%. Sunflower Land and Stepn, two of the most popular “move to earn” games, grew their user bases by a whopping 129 percent last year. In addition, blockchain games have continued to draw record venture capital investments, indicating a bright future for the sector as a whole.
