Key takeaways from DappRadar’s 2022 review

by · January 4, 2023

2022 will go down as a challenging year for the cryptocurrency and blockchain space, but the adversity has been sprinkled with plenty of positives for the decentralized application (DApp) ecosystem.

DappRadar has released its annual report on the industry, focusing on challenges alongside notable technological achievements and a growing number of active daily users.

Cointelegraph highlights the main options from the DApp industry in 2022, which are relevant, considering macro factors such as inflationary problems in major economies, the collapse of industry-specific projects such as Terra/Luna and FTX, as well as market problems across the board.

Perhaps most interesting is unique active wallet (UAW) data from 2021 and 2022, which shows a 50% increase in average daily UAW year-over-year. This is up from 1.58 million daily users in 2021 to an average of 2.37 million daily active users in 2022.

Source: DappRadar

It should be noted that there was a downward trend of DApp users from February 2022, which DappRadar associated with the escalating war in Ukraine as well as crypto-specific black swan events, including Terra/Luna and FTX’s collapse.

The decentralized finance (DeFi) industry was particularly affected in the wake of Terra’s TerraUSD (UST) depeg and the resulting downturn in the cryptocurrency market, with a significant drop in total value locked (TVL) of around 73% to $55 billion as of December 2022.

Related: Gaming accounts for over half of blockchain industry usage, DappRadar

Layer-1 DeFi protocols saw the largest drop in TVL, with Ethereum experiencing a 74.5% reduction to $32.12 billion TVL, while the second largest DeFi ecosystem, BNB Chain, recorded a 62.5% drop in TVL in 2022. Layer-2 protocols fared slightly better, with Arbitrum falling 12% to $1.74 billion. Optimism’s TVL increased by 127.60% to reach $669 million.

On-chain data for nonfungible token (NFT) trading volume was in contrast to DeFi’s year-to-date. NFT trading volume increased by just 0.41% year-on-year, while the number of unique traders increased by a staggering 876% to reach 10.6 million users in 2022. NFT sales also developed positively, increasing by 10.6% to 68.35 million. OpenSea remains the most popular NFT marketplace, accounting for 73% of organic NFT trading volume.

Blockchain gaming played a significant role in the DApp space, accounting for 49% of activity in 2022, with an average of 1.15 million daily UAW. In total, the sector produced 7.4 billion transactions this year.

Blockchain-powered trading card game Splinterlands was the most popular platform, according to DappRadar, growing by 85% to reach 217,914 monthly unique active wallets in 2022.

Terra’s implosion accounts for $40 billion in lost funds, while DappRadar estimated the median loss per hack was around $283,000 and the loss per month was put at $728 million.

DappRadar integrated 49 blockchains, tracked 13,000 DApps and 13,500 NFT collections and noted that the increased number of DApps reflects the resilience and potential of the sector, with projects continuing to build and innovate despite a challenging macro environment.

Hacks, thefts and rug pulls are also featured in DappRadar’s 2022 review. A total of 312 attacks resulted in total losses of $48.74 billion across the board, the highest amount recorded since Bitcoin’s inception back in 2009.