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Activity up, value down; How dapps reacted to Covid-19

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DappRadar

April 2020 dapp ecosystem report

Our April 2020 overview of the dapp ecosystem provides the first opportunity to see how the sector reacted to both the financial and the social shock triggered by the global lockdown caused by Covid-19 in mid-March. 

Looking at the three main blockchains, Ethereum, TRON, and EOS, activity during April  2020 rose compared to March. 

Overall activity across all tracked dapps on these blockchains was up 7%, averaging 56,507 daily active unique wallets. 

Ethereum was up 7%, EOS up 31%, and TRON down 7%. 

However, taking a longer timeline and making a year-on-year comparison, only Ethereum was up  – 61% – with EOS down 55% and TRON down 21%. 

There was a different dynamic, however, when considering the value of tokens interacting with dapps. Ethereum dapps – particularly DeFi and exchanges – dropped significantly month-on-month, and this resulted in an overall decline in value across the three blockchains. 

Total USD value in April was $1.8 billion, down 31% compared to March 2020, although up 30% compared to April 2019. 

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Table of contents

Key Takeaways

Ethereum

TRON

EOS

Conclusions

Let Jon Jordan take you through the report

Key Takeaways

  • Overall dapp activity was up 7% month-on-month in April 2020 to an average of 56,507 daily active unique wallets. 
  • Overall USD value dropped 31% month-on-month in April 2020 to $1.8 billion. 
  • Activity across Ethereum dapps rose 19% to an average of 22,285 daily active unique wallets.
  • The EOS dapp ecosystem rebounded from their March low, up 75% to 24,173 daily active unique wallets.  
  • The TRON dapp ecosystem declined 25% to 17,151 to daily active unique wallets. 
  • In USD value terms, the biggest change was the hit to Ethereum DeFi and exchange dapps. Combined, these categories saw a 52% drop in value transacted compared to March 2020. This was a result of uncertainty arising from Covid-19. 
  • The biggest new dapp during April 2020 was Ethereum high-risk dapp HEX, which attracted $29 million worth of value from an average of 1,433 daily active unique wallets.

Ethereum dapp ecosystem

The shock of the Covid-19 asset sell-off of 12 March 2020 and its impact on the stability of certain DeFi dapps remains a heavy weight on the Ethereum dapp ecosystem.

It depressed both daily activity, and in particular, the amount of token value interacting with dapps during the second half of March, interrupting what had been a very positive upward trend during the first two months of 2020. 

Yet, total daily activity across all Ethereum dapps has quickly rebounded, from a low of under 17,000 daily active unique wallets in late March to a high of over 23,000 towards the end of April. 

Daily activity was up 7% in April compared to March, also up 61% compared to April 2019. 

This increase was mainly driven by activity in two categories – exchanges (up 11% compared to March 2020) and high-risk gambling dapps (up 54%). 

The rising popularity of exchanges in such a situation isn’t surprising as users always trade more during price volatility, and this remains the situation for all cryptocurrencies at the current time. 

Daily activity through exchange protocols such as Uniswap and Kyber rose to an average of 4,219 daily active unique wallets in April compared to March. 

USD Value

The USD value of token volumes through exchanges declined 34% to a daily average of just over $10 million. Although in this context, we have to note that’s similar to the recent drop in cryptocurrency values compared to the dollar so absolute trading in ETH terms remained broadly the same month-on-month.

The biggest driver of new activity on the Ethereum blockchain during April was the high-risk dapp HEX. Although controversial in terms of its aims and methods. HEX ended April by regularly attracting more than 1,000 daily active unique wallets, and accounting for around half of the category’s total USD value during April at $29 million. 

As a category, gambling and high-risk dapps increased their total value in April by 34%, total spending from users during April of $58 million.

Gaming and marketplaces continued to be the most popular dapp category on Ethereum in April, with a daily average of 7,935 daily active unique wallets across all dapps, down 14% compared to March 2020. 

More generally, however, the DeFi category remains the most valuable on Ethereum. With a daily average of $21 million of value interacting with dapps, down 58% month-on-month. The total of daily active unique wallets across all DeFi dapps dropped 18% to an average of 1,757 daily across the month. 

And this resulted in an overall decline in terms of the amount of value interacting with all Ethereum dapps of 49% during April compared to March 2020. 

Hence while daily activity has quickly rebounded, it’s clear users are now less confident about investing large amounts of value into Ethereum dapps, in general, and DeFi dapps in particular.

TRON dapp ecosystem

TRON’s reputation as ‘Las Vegas on the Blockchain’ continues. 

The gambling and high-risk category accounted for 89% of the $109 million of total value accrued across all TRON dapps during April 2020, and 84% of TRON’s average daily activity of almost 20,000 unique wallets. 

That stated the category continues to decline. Total value was down 7% compared to March 2020 and down a massive 65% year-on-year. Daily activity was down 7% month-on-month and 18% year-on-year. 

The exchange category on TRON has also contracted in terms of total volume, down 25% month-on-month for a total of $6 million worth of value. While activity across games and marketplace dapps declined by a significant level too – down 47% month-on-month.

But there was some good news. Although DeFi remains a tiny category for TRON. The launch of Zethyr and Just has been a positive signal, which between them attracted almost 150 daily active unique wallets by the end of April. Accumulating a total value during the month of $3.5 million.

EOS dapp ecosystem

Although down 55 percent in terms of total activity across all dapps year-on-year, there was some positive news for EOS. With its dapp ecosystem experiencing activity growth of 31% month-on-month. 

That’s the first serious month of growth experienced since the disastrous launch of the EIDOS airdrop in November 2019. Which led to widespread and ongoing network congestion.

Average activity in terms of daily active unique wallets on EOS during April was just shy of 17,000. That compares to over 36,000 in April 2019. 

The vast majority of this growth came from gambling dapp Dice. Which experienced rapid expansion, ending the month with over 7,000 daily active unique wallets. Compared to around 500 during March 2020. 

Overall, the gambling and high-risk category experienced activity growth of 48% in April compared to March 2020. Although that was still down 67% compared to April 2019.

Thanks to titles such as EOS Dynasty and Prospectors, the games and marketplace category also experienced growth, up 17% month-on-month. The exchange category continued what seems to be its long term activity decline, down 15% month-on-month. 

Yet, despite this, token values across all EOS dapps rose. 

During April, $627 million worth of tokens was accrued by EOS dapps. With exchanges, gambling and high-risk, and games and marketplaces all up by at least 50% month-on-month. The Newdex exchange dapp and new game ChainZ accounted for a large proportion of this growth. 

Conclusions

Given it’s the most popular and valuable dapp ecosystem, and one in which decentralized finance dapps are particularly important. How users of Ethereum dapps reacted to the Covid-19 shock was always going to be the key trend during April.

The month-on-month rise in daily activity shows that users continue to find these dapps useful, and continue to use them. Despite what has happened to the price of cryptocurrencies. 

However, the 49% decline in USD value during April does show there has been some loss of confidence. Particularly in dapps based around the value of cryptocurrencies; that is the DeFi and exchange categories. 

As an aside, in this context, the explosive rise of the high-risk dapp HEX, and its get-rich-quick narrative, is no coincidence.

More generally, it will be interesting to see how confidence around Ethereum dapps change in future months. Both as the DeFi category continues to evolve and structural improvements such as Ethereum 2.0 launch. 

As for the TRON and EOS dapp ecosystems. What’s surprising is the Covid-19 shock that so impacted Ethereum dapps appears to have had little effect. 

TRON has continued to drop, both in terms of its daily activity and value. On the other hand, after months of decline, EOS has finally rebounded. Interestingly, this hasn’t been triggered by the launch of new dapps, rather it appears that the network congestion caused by the EIDOS airdrop has finally subsided.

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