DappRadar has shown a high-risk dapps category since its early inception. There are already 813 dapps submitted on DappRadar that grants the second place for the category after gambling. Important to note, only 12% shows any activity now.
High-risk dapps are mainly Ponzi schemes or similar high-yield investment programs that promise an unsustainably high return on investment. High returns are not the only feature applicable to the category. Usually, such dapps are not transparent with the risk level or only functionality of the dapp is an investment into the token.
Furthermore, it is not common to see sustainable activity within the dapp. Generally, we witness racing activity that ends with the crash within a few months.
Lately, we spot the increased number of new high-risk dapps, transaction volume, and daily active wallets. It is important to examine the reason behind the surge.
This content is written for research and distribution purposes only. We aim to review the current trends and data in the high-risk dapps category.
Key takeaways
- Ethereum is still a leading protocol for the High-Risk category. It accounts for 97% (or $278 million) of total transaction volumes in Q2 2020.
- $202 million of Ethereum volume was generated by one single dapp HEX.
- Forsage accounts for 50% of daily active wallets across all Ethereum High-Risk dapps.
- Daily activity across all TRON high-risk dapps occasionally surpassed 10,000 in July 2020. It was mainly driven by BeeHive Fast and Bank of TRON.
- EOS and IOST high-risk dapps had momentum back in 2019. Very little activity is being recorded in 2020.
Ethereum: Daily active wallets grew by 134% quarter-on-quarter
Ethereum is still one of the most powerful protocols in the blockchain world. We’ve seen a year-on-year growth in almost all dapp categories. The High-Risk category is not an exception. It has made an all-time high number in daily active wallets and transaction volume. Additionally, a total of 74 new dapps has been submitted in Q2 2020 that is twice higher than in the previous quarter.
In Q2 2020 we witness tremendous increase by 134% in daily active wallets quarter-on-quarter. High-Risk dapps on Ethereum now attract at least 4,200 daily active wallets now. Dapp Forsage is responsible for 50% of the daily activity now.
Ethereum: Transaction volumes surpassed $270 million in Q2 2020
In Q2 2020, the transaction volume increased by 910% compared to Q1 2020. The category has generated $278 million during Q2 2020.
The rise in Q2 2020 volume is due to a dapp called HEX that contributed 73% by generating $202 million. The growth was driven by the explosive price rise of the HEX tokens in May 2020.
Ethereum: Does HEX still have its momentum?
The HEX dapp started in early December 2019. The dapp has been the leading dapp for Ethereum’s High-Risk category. HEX is different from other High-Risk dapps; they are structured around hot potato game theory or standard pyramid selling.
The dapp has its own token called HEX which is popular now in the DEX world, high return staking mechanics, and strong affiliate marketing. It is better viewed through the lens of an ambitious attempt to bootstrap a new cryptocurrency and community.
In Q2 2020 it generated the best volume in all time from the time of its existence which is almost $202 million. Simultaneously, there was a surge in daily activity at the beginning of Q2 2020. However, we can see a trend of daily activity declining i.e, on general from 1,000 wallets to 400 wallets by the end of June.
Ethereum: Forsage faces an all-time high daily active wallets
Forsage started its journey back in January 2020. It describes itself as a crowdfunding platform with an easy way of earning ETH. Wallets can participate with an initial payment of 0.5 ETH. Of course, high-yield returns are promised within a couple of weeks. The earnings depend on the affiliate network you create.
From the first look, dapp is very similar to some advanced Ponzi schemes that try to use blockchain technology to its advantage.
The daily activity of Forsage took the next level in Q2 2020, it has increased by 670% compared to Q1 2020. Occasionally, daily active wallets were close to 3,000 during Q2 2020.
The transaction volume of Forsage surged month-on-month. In Q2 2020 Forsage has generated $43 million or 16% of High-Risk category volume. The surge doesn’t seem to be stopping now. In July 2020 it already generated more than $20 million that is already half of Q2 2020.
Ethereum: conclusions
Ethereum remains the leadership within the High-Risk category in Q2 2020. The growth of both transaction volume and daily active wallets was substantial. On the other hand, it was mainly driven by a couple of dapps: HEX and Forsage.
This brings us to understand that the growth we observe right now on Ethereum High-Risk is based on just a few risky dapps, and as such is fragile.
TRON: Daily active wallets occasionally surpassed 10,000 in July 2020
TRON protocol has experienced an erratic journey in the High-Risk category since 2019 in both volumes and daily activity. However, it is observed that there is a positive sign of growth in the category in Q2 2020. There was an elevation in new submitted daps too. 28 new dapps were added to DappRadar during Q2 2020.
In Q2 2020 the daily activity increased by 276% quarter-on-quarter and 396% year-on-year. BeeHive Fast, Bank of TRON, and CryptoFriends have fueled the category with 2,201, 1,106, and 552 daily active unique wallets respectively. As of today it stands number one category in contributing the daily activity to the TRON protocol.
TRON: Transaction volume surges to $10 million
Ever since Q1 2019, there has been a plunge in the transaction volume of High-Risk in TRON. And after a year we witness a new wave of growth.
The Q2 2020 category generated $10 million of transaction volume and increased its value by 2,342% compared to Q1 2020. ECOSmart ECS, Bank of TRON, and BeeHive Fast contributed 52%, 26%, and 9% to the total volume.
In July 2020, the category has already raised the volume of almost $5 million which is half of 2020 Q2 volumes. If the trend continues, we will witness still higher number figures in Q3 2020.
TRON: BeeHive Fast generated $1 million volumes in June
BeeHive Fast is a game simulator where users can earn TRX. At first glance dapp is very similar to the game where you keep bees that produce honey. The honey can be converted into the TRX. Of course there is an entry fee.
When you look closer it is another type of Ponzi scheme. More people join the platform, more dividends for early investors. All later investors have very high chances of losing the money they invest into the game.
In June 2020 the dapp has generated a volume of $1 million with the daily activity of at least 2,000 and more per day. So far in July month, the dapp has generated a volume of at least $1.5 million by maintaining the daily activity of 1,000 wallets.
TRON: Bank of TRON daily active wallets reaches almost 3,500
Bank of TRON dapp represents itself as a high-yield investment program. According to their site, it has the selection of different plans from Diamond to Bronze. The percentage of earnings might look very attractive that carries a certain risk. Worth noting, there is no real explanation how secure your investment is or where your money is being invested in.
If we look into the daily activity and transaction volume of the dapp in 2020. The dapp looks promising from June month. By the end of June it has 1,106 wallets active and has generated $2.7 million in June which is the highest so far from the time of its existence.
As of July, the generated volume so far is $2 million with 3,387 wallets, way to go for this dapp to be one of the top’s in the High-Risk category.
TRON: Conclusions
The TRON High-Risk category faces the second wave of increase. The first one was back in 2019, the second is occurring right now. As usual all of the growth is driven by a couple of dapps. The majority are in very early stages of existence.
Similar to Ethereum, we expect to see a little development of the category in the future. It is likely to repeat the same trend as it was in 2019.
EOS & IOST declines day by day
EOS and IOST protocols didn’t face the same trends as Ethereum and TRON. The protocols dapps already have momentum back in 2019. Very little activity is being recorded in 2020.
In Q1 2019 the daily active unique wallet of EOS was around 624 and recently it has declined to 6 daily active wallets. The only dapps that are still active are EOS Pack, HiGold Miner, and 333 EOS.
IOST follows similar trends as EOS. The only dapp which makes the IOST still in the race of High-Risk category is Fish n’ Chips with 10 daily active users.
As a result, the transaction volume has declined too. The volumes are now close to zero.
Conclusions
Q2 2020 could be named as the “Second Season for High-Risk”. First of all, the High-Risk category is the second largest category on DappRadar after Gambling by dapps number. Secondly, it shows excessive development of both transaction volumes and daily active wallets in 2020 Q2. Similarly it has already happened back in 2019.
One trend could be spotted within each of the dapps. At the beginning activity in these dapps sharply rose but within a couple of months decreased significantly. Very few dapps retain the activity longer than half of the year.
Ethereum has proved to be the best protocol for the blockchain dapp no matter what category is. It is responsible for 97% of transaction volumes generated in Q2 2020.
Although TRON protocol has experienced an intense journey since 2019 in the category of High-Risk; it paints an reassuring picture in Q2 2020 with most of the new High-Risk projects being released.
As ever – and particularly in this case. DappRadar reminds users never to invest more value into dapps than they can afford to lose.
As always we will continue to monitor developments as they unfold. For now, make sure to bookmark DappRadar and sign up to our newsletter to receive regular updates directly to your inbox.
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