Has the Terra Debacle Changed NFT, DeFi and Crypto Adoption?
Terra blockchain’s demise had ramifications for almost every aspect of the crypto space. The event has sparked a number of debates among industry experts and government watchdogs. Many people lost not only their savings but also their hope in the crypto space.
A recent report by DappRadar, a platform for decentralized applications, has compared the Terra collapse to the subprime mortgage crisis of 2008. The housing bubble of 2008 had a detrimental impact on all aspects of the global economy. Cryptocrash in 2022 is no less different, according to DappRadar. They went so far as to compare it to Lehman Brothers.
What has changed since the fall of Terra?
According to the report, overall blockchain activity has remained more or less unchanged. The platforms report a 1% decrease in total transactions since Q1 2022. However, DeFi-related transactions have decreased by almost 15% since Terra’s fall in May 2022.
Meanwhile, the number of transactions for NFTs (non-fungible tokens) has decreased by 12.2% in the last quarter. NFT transaction volume fell 67% in May, while the sales figure fell 21%. Additionally, the number of unique active wallets interacting with NFTs has decreased by 24% since the May Terra collapse. Nevertheless, compared to Q2 2021, activity is still up by 48%.
Nevertheless, blockchain games seem to have defied the trend. DappRadar reports that blockchain-based game transactions increased by 9.51% in Q2 2022. The report found that despite the Terra debacle, investment in games and the metaverse remained constant at $2.5 billion in Q1 and Q2 of 2022. Number of unique active wallets has fallen. with 7% last quarter. This indicates that the number of people interacting with blockchain games has remained more or less constant before and after the Terra event.
Now, why blockchain gaming numbers haven’t dropped since the Terra fiasco is up for speculation. It is possible that the users who interact with such projects are not in it for profit. Gaming tends to be more of a leisure activity than a source of income, at least for now. And this aspect may be a reason for the unchanged calculation.
Another DappRadar report from July 12 also confirms the findings of the new report. The report found that blockchain-based games were the least affected in the bear market following the Terra collapse. The report saw a 19% increase in sales figures year-on-year.
Blockchain-based gaming as an industry is only expected to grow. The gaming industry is one of the fastest growing sectors in the technology world; therefore, it will not be surprising to see blockchain-based games take center stage soon.
