The cryptocurrency landscape in May presented a tableau of contrasts and complexities. As specific segments displayed resilience and robust growth, others revealed signs of regression, vividly depicting the sector’s innate dynamism. The DeFi (Decentralized Finance) segment, despite a decrease in total value locked (TVL), witnessed an uptick in on-chain activity share. While the decentralized applications (dApp) sector flourished, blockchains, barring Tron, experienced a contraction in TVL.
As per the recent DappRadar report, the crypto industry delivered various performances in May. However, while specific industry facets moved forward, others displayed a pullback. The DeFi ecosystem, key to this narrative, presented an intriguing paradox.
TVL in DeFi protocols, a reflection of the funds engaged in these systems, reported a slight contraction of 4.3% in May, falling to $79.16 billion. Nonetheless, it’s worth noting that the share of DeFi in on-chain activities escalated to 31%. That suggests a growing number of users leveraging these protocols, albeit with a cumulative smaller financial stake.
Contrary to the trend, the dApp sector charted a growth course in May, expanding by 9.97%. It resulted in an average of 1,967,051 daily unique active wallets (dUAW), indicative of a steadfast rise in web3 interest.
May proved challenging for blockchains, as nearly all platforms reported a decrease in TVL. Tron, however, bucked this trend, registering marginal growth just under 1% during the month.
Fantom (FTM) bore the most significant blow, which saw its TVL plunge by 37% to $308 million. This downturn was largely attributed to the Multichain turbulence stoked by rumors of impending arrests in China.
The dramatic 49% dip in Multichain’s native token, MULTI, adversely impacted Fantom’s assets, prompting a pivot towards Arbitrum.
The Non-Fungible Token (NFT) market reflected the industry’s larger trend, displaying a patchy performance in May. Trading volume dipped below the $1 billion mark for the first time since December 2022, as NFT trading volume in May plummeted by 44%, reaching $675 million.
Despite the decline, Blur dominated the NFT marketplace in May 2023, capturing a whopping 65% market share, translating to $442 million in NFT sales. OpenSea, once the reigning monarch of NFT marketplaces, had to settle with a 27% market share and a revenue of $183 million.
The trading figures reveal an interesting facet – despite Blur’s supremacy, OpenSea boasted a significantly larger trader base, with 377,087 traders versus Blur’s 36,673. This suggests that Blur caters to a niche market segment – those focused more on high-frequency trading than on collecting.
However, the emergence of Blur’s NFT lending service, Blend, has somewhat diverted attention from its trading platform. The migration of NFT traders from trading to lending has notably contributed to the slump in trading volume.
The post The State of DApps in May 2023: Quantity Grows But TVL Tanks appeared first on CryptoMode.
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