Crypto enthusiasts say goodbye to ‘tourist builders’ amid 26% drop in development activity
According to recent data, a prolonged market downturn has led to a more than 26% reduction in the number of weekly active developers over the past three months.
According to Blockchain data aggregator Artemis, the top four smart contract platforms witnessed even much larger reductions in developer activity. These include Ethereum [ETH]Polka dot [DOT]Solana [SOL]and Cosmos [ATOM]. These networks witnessed 30.5% decline [ETH]43.6% [DOT]48.4% [SOL]and 48.9% [ATOM]respectively.
Source: Artemis
The current market situation?
Building smart contracts that power decentralized applications, maintaining and updating infrastructure, and developing blockchain architecture are the responsibilities of blockchain developers. One of the key indicators of success for a smart contract platform is the activity of the blockchain developers. A platform with few developers will likely find it difficult to expand.
But on September 8, Tascha Che, a cryptocurrency researcher and the founder of Tascha Labs, tweeted that she did not think the trend was that worrying. She also stated that the decline was attributed to the departure of “tourist investors” and “tourist builders”. Furthermore, it would give real builders “the peace and quiet to get real work done.”
Active developers across all crypto protocols have fallen by 30% this year.
Tourist builders leave with tourist investors.
Finally, the industry has some peace and quiet to get proper work done.
h/t @Artemis__xyz pic.twitter.com/PAGi6Yh7eo
— Tascha (@TaschaLabs) 8 September 2022
Another Twitter usera Binance research analyst, argued that developer activity will be an “essential indicator” to pay attention to in the future due to the “flywheel effect” it has on the industry.
The Interplanetary File System (IPFS), a decentralized data storage technology, and the Internet Computer blockchain network were two of the few leading platforms for smart contracts. These platforms experienced growth of 206.6% and 21.7% respectively.
The impact on trading volume
According to a study by cryptocurrency asset manager CoinShares, institutional investor trading activity for crypto funds fell to $1 billion last month. This was the second lowest amount of the year.
For some time now there has been no trade. Furthermore, over the past three weeks, volumes have remained at or just above $1 billion. According to CoinShares, last week’s drop to $1 billion made it the second worst trading week so far this year. This is a decrease of 55% from the year’s average trading volume.
According to further research published by Glassnode, there are indications that interest has also been declining among retailers. Although Bitcoin [BTC]The price increased slightly last week, according to Glassnode, trading volume for transactions costing $1,000 or less consistently decreased. Furthermore, Glassnode blamed retailers.
