2022 will go down in history as a difficult year for the cryptocurrency and blockchain space, but the adversity it has faced has been peppered with many positives for the decentralized application (DApp) ecosystem.
DappRadar has released its annual report on the industry, focusing on the challenges it has faced along with notable technological achievements and a growing number of daily active users.
Cointelegraph highlights the main takeaways from the DApp industry in 2022, which are pertinent, taking into account macro factors such as inflationary concerns in major economies, the collapse of industry-specific projects like Terra/Luna and FTX, as well as the issues of the overall market.
Perhaps most revealing is the 2021 and 2022 Single Active Wallet (UAW) data, which demonstrates a 50% increase in median daily UAW year-over-year.. It has gone from 1.58 million daily users in 2021 to an average of 2.37 million daily active users in 2022.
It should be noted that there was a downward trend of DApp users beginning in February 2022, which DappRadar associated with the escalation of the war in Ukraine, as well as cryptocurrency-specific black swan events, including the collapse of Terra/ Moon and FTX.
The Decentralized Finance (DeFi) industry was hit particularly hard in the wake of the decoupling of TerraUSD (UST) and the ensuing cryptocurrency market crash, with Total Value Locked (TVL) dropping significantly to around 73% to USD 55 billion as of December 2022.
Layer 1 DeFi protocols saw the biggest drop in TVL, with Ethereum seeing a 74.5% drop to $32.12 billion TVL, while the second largest DeFi ecosystem, BNB Chain, saw a 62.5% drop in TVL in 2022. Layer 2 protocols fared slightly better, with Arbitrum falling 12% to $1.74 billion. Optimism’s TVL increased by 127.60%, reaching USD 669 million.
On-chain data for non-fungible token (NFT) trading volume contrasted with DeFi year-to-date. NFT trading volume increased just 0.41% YoY while the number of unique traders increased a staggering 876% to reach 10.6 million users in 2022. NFT sales also evolved positively, increasing by 10.6% to reach 68.35 million. OpenSea remains the most popular NFT marketplace, accounting for 73% of organic NFT trading volume.
Blockchain gaming played a significant role in the DApp space, accounting for 49% of activity in 2022, averaging 1.15 million UAWs daily. In total, the sector produced 7.4 billion transactions this year.
Blockchain-powered collectible card game Splinterlands was the most popular platform, according to DappRadar, growing 85% to reach 217,914 unique monthly active wallets by 2022.
The Terra implosion accounts for $40 billion of lost funds, while DappRadar estimated the median loss per hack to be around $283,000 and losses per month pegged at $728 million.
DappRadar integrated 49 blockchains, tracked 13,000 DApps and 13,500 NFT collections, noting that the rising number of DApps reflects the resilience and potential of the sector, with projects continuing to build and innovate despite a challenging macro environment.
Hacks, thefts, and rug pulling are also featured in DappRadar’s 2022 review. A total of 312 attacks led to total losses of $48.74 billion, the most since Bitcoin’s creation in 2009.
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