DeFi powers dapp ecosystem up 16% to $1.9 billion in May 2020

Our May 2020 overview of the dapp ecosystem extends our coverage of the three main dapp blockchains – Ethereum, TRON, and EOS – now to a total of six, with the inclusion of Steem, Hive, and WAX.

Of course, Steem and Hive are currently conducting a messy divorce, with the community split by the TRON Foundation’s hostile takeover and many dapps moving from Steem to the new Hive hard fork in response.

Meanwhile, on the WAX blockchain, the successful launch of the Garbage Pail Kids collectibles on 12 May has kickstarted wider trading activity, particularly among its marketplace dapps, which subsequently have experienced strong growth.

Key takeaways

• Overall activity was down 3% in May 2020 compared to April with a daily average of 69,119 active unique wallets interacting with dapps across the six blockchains covered in this report.
• The overall value of all tokens interacting with dapps running on these six blockchains was up 16% to $1.9 billion.
• High gas fees saw Ethereum’s daily activity drop 14% month-on-month but volumes through DeFi and exchange dapps remained strong with total value during May up 25% to $1.2 billion.
• Gambling dapps dominated TRON’s performance, with volumes up 24% month-on-month to $131 million, although daily activity dropped 15%
• EOS dapps experienced a flat month, with daily activity up 3% and volume steady at $616 million.
• The separation of the Steem and Hive communities continued with daily activity on Hive up 201% while Steem declined 31%.
• WAX experienced the successful launch of the Garbage Pail Kids collectibles, which increased the amount of value interacting with its dapps during May by 601% to a total of $860,000.

Ethereum

The biggest activity influence on dapps running on the Ethereum blockchain during May 2020 was the continuing high price of gas. The result of elevated activity arising from the use of the Tether stablecoin on Ethereum, combined with traffic from four high-risk dapps, this trend started in mid-April and shows no sign of ending.

Obviously, rising gas prices make every Ethereum transaction more expensive, hence reducing dapp usage.

However, the pain wasn’t felt equally across all dapp categories. While daily activity across DeFi and DEX dapps was down by 19% and 14% respectively comparing May to April, gambling was down 26%, while activity across games and marketplaces was down a massive 61%.

This is significant as gaming is generally the most popular category on Ethereum. For example, it accounted for 42% of daily activity across Ethereum dapps in April, but this declined to 23% in May.

Overall, compared to April, activity across all Ethereum dapps during May was down 14% to an average of 16,191 daily active unique wallets.

Conversely, the total value of ETH and ERC20 tokens interacting with Ethereum dapps wasn’t impacted by higher gas prices at all. Month-on-month, the total value rose 25%, from $920 million in April to $1.2 billion in May.

DeFi dapps remain the most important category in this respect, accounting for 60% of May’s value total, with exchanges in second place, accounting for 24%.

Six dapps in these two categories each accounted for more than $100 million worth of value during May: MakerDAO; Compound; dYdX; Uniswap; Kyber; and 1inch.

Gambling and high-risk dapps increased their share of the total value from 6 to 13%, thanks mainly to activity on the Hex high-risk dapp, which accounted for $103 million worth of value.

TRON

Although DeFi dapp JUST continues its growth, the overall performance of the TRON blockchain in terms of dapp activity remains predicated on the gambling and high-risk category.

During May 2020, it accounted for 85% of the total $131 million worth of value and 75% of the daily average of 18,028 unique wallets.

Similarly, the reason TRON experienced a 15% decline in month-on-month daily activity combined with a 24% rise in total value was that the gambling category shed users but increased its value.

The main TRON gambling dapps remain WINk, 888TRON, and RocketGame.

Nevertheless, with an average of 365 daily active unique wallets and a total value in May of almost $9 million – both up over 150% compared to April 2020 – it will be interesting to see how JUST, which is similar to MakerDAO on Ethereum, develops over the coming months.

However, more generally, the long term trend remains a steady decline for TRON dapps in terms of overall activity, both in terms of daily activity – down 5% year-on-year – and particularly value – down 68% compared to May 2019’s performance.

EOS

May 2020 was a very quiet month for dapps running on the EOS blockchain.

The average daily activity across all dapps was 16,441 unique wallets, up 3% compared to April 2020, while the value of all EOS tokens was $616 million, compared to $615 million in April.

Nor was there much change in terms of specific dapp categories, either in terms of daily activity or value.

In terms of daily active unique wallets, over half of May’s activity came from games and marketplaces (55%), with gambling and high-risk dapps taking 10% and exchanges 5%. All three categories experienced around 10% month-on-month growth.

However, when it comes to value, exchanges – notably Nexdex – account for majority stake (75%), with the rest from gambling dapps.

This is a long term trend, with exchanges taking an increasingly larger proportion of EOS’ total value as gambling activity has dropped heavily over the past 12 months.

Hive & Steem

DappRadar started tracking dapps on the Steem and Hive blockchain during May, so this report provides the first opportunity to investigate these two warring communities.

Launched in March 2020 as a hard fork of Steem by community members unhappy with the sudden involvement of the TRON Foundation, Hive remains a work-in-progress but early trends are clear.

Most obvious to see is the impact when high volume Steem dapps transition to Hive, bringing their existing audiences with them. Specifically on 27 May, Peakd and Hive Blog – both versions of the Steemit blogging platform – launched on Hive, resulting in an immediate three-fold increase in Hive’s daily active unique wallet total.

Interestingly, Steem is yet to demonstrate a similar decline; however it’s daily active dropped 25% during May to around 7,000 daily active unique wallets, while Hive ended the month with daily activity of around 4,000 unique wallets.

This trend is expected to continue in June when the most popular Steem dapp – the SPLINTERLANDS game with over 4,000 daily active unique wallets  – moves to Hive.

WAX

Launched in December 2019, the WAX blockchain is built using the EOS.IO SDK and unsurprisingly has found some success attracting EOS dapps to launch on its new platform, which offers some advantages, particularly in respect to onboarding.

However, its performance in May demonstrates the value of exclusive content. Launching a digital version of the Garbage Pail Kids collectible cards has resulted in a wider boost to WAX’s dapp ecosystem, particularly marketplaces.

Launched on 12 May, the card packs sold out within two days, with activity then switching to marketplaces such as GPK.Market, Alcor.Exchange and SimpleMarket, with over $280,000-worth of trading occurring the launch week.

More generally, during May, the overall value was up 601% to $859,000 as the trading of Garbage Pail Kids continued post-launch.

Yet, while trading volumes continue to be elevated, it’s clear that post-launch only a small number of users are now active.

After rising around 30%, daily activity across all dapps on the WAX blockchain ended up down 30% across May. This was due to a strong decline in the audience of gambling dapp EarnBet.

Conclusions

May 2020 demonstrates that when there’s no overall systemic influence impacting the entire blockchain sector, the performance of each individual blockchain is shaped by its own internal dynamics.

In the case of Ethereum, high gas prices hit price-sensitive activity such as gaming hard while leaving the high-value activity of DeFi and exchange untouched and growing their value proposition.

For TRON and EOS, in the absence of exciting new dapps, their performance followed long term trends, unlike WAX, which was boosted by the successful launch of the Garbage Pail Kids collectibles. Meanwhile, Steem and Hive experienced the first round of what might be a long, drawn-out battle for popularity amongst their divided communities.

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