Open Source Blockchain Development Strong, Despite Funding Cuts – The New Stack

If you just focus on the headlines, the Web3 space looks pretty dire in 2022. Funding for Web3 companies is down 25.6% year-over-year when comparing the first half of 2021 to the first half of this year. Cryptocurrency valuation is down by as much as 80%. On the other hand, open source Web3 projects are still going strong according to a study published by Telstra Ventures’ data science team this week.

Study method for developer contributions

The Telstra Ventures study analyzed 1,000 active organizations contributing to more than 30,000 Bitcoin, Ethereum and Solana open source projects on GitHub, as defined by the Crypto Ecosystems taxonomy established by Electric Capital in late 2021, along with projects identified by cryptocurrency projects and token aggregators.

Telstra limited projects to those with a minimum of 100 stars in related GitHub repositories and active contributions through July 2022. In an interview with The New Stack, Jonathan Serfaty, head of data science at Telstra Ventures, said: “We looked at contributors from an organization standpoint . For example, we looked at the specific repository that contains the Ethereum project. We looked at the Ethereum organization’s contributors. And we looked at the Ethereum ecosystem, which includes all the surrounding EVM-enabled projects.” Telstra plans to re-run the report periodically to continue to monitor the health of the Web3 open source community.

Findings from the Telstra Ventures study

I asked Serfaty if there were any surprises in the data from the study. He said: “There is a very core group of developers, and even through previous downturns, this core group has continued to be active in building out the project they believe in regardless of what the cryptocurrency market is doing.”

The study indicates that Ethereum is growing at a compound annual growth rate of contributors of 24.9% through market volatility over the past 4 years starting January 1, 2018, which is illustrated in the chart below. You may also notice that Ethereum developer contributions have risen slightly from where they were in July 2021, despite the huge price volatility.

Yash Patel, General Partner at Telstra said: “When you think about traditional stock markets and crypto prices, which are down 70% or more from a year ago. We are interested in the builders who are building further. We take comfort in the fact that the decline in contributions is relatively small compared to the price speculation that you have seen in the financial area.”

One thing I found interesting is the overall size of the developer ecosystem across Bitcoin, Ethereum and Solana. Ethereum remains the largest blockchain in terms of developers actively contributing to projects, with approximately 2,100 active developers. Bitcoin, the most mature of the blockchains measured, has around 400 developers actively contributing to projects, while Solana has just under 300 active contributors as of the end of July.

Be sure to read the full Telstra Ventures study on Bitcoin, Ethereum and Solana. If you’re curious about developer activity with other blockchains, the Electric Capital Ecosystem Browser includes a much broader set of blockchains and protocols, with 96,436 repositories tracked across 3,845 ecosystems.

Featured image from Depositphotos ID: 203558604 by VisualGeneration