DeFi Activity On dApps Grew 3.7% In August

dApps show a slight recovery for the first time since May, with the daily average of unique active wallets (UAWs) increasing by 3.7% on a monthly basis, according to a report from DappRadar.

The increase was partly driven by the Flow protocol, a 577% increase in UAW due to Instagram’s support for NFT and the Solitaire Blitz game. On the other hand, Solana UAW fell 53% in August from the previous month, while trading fell 68%, the results showed.

Among industries, gaming accounted for more than 50% of activity, with 847,230 UAW daily, albeit down 11%, and transaction volume down 12.7% month-on-month to $698 million. On the NFT side, the UAW fell 16.7% to 114,542 – its lowest level since June 2021, according to the report.

Despite the rise of DeFi in single active wallets, the total value of DeFi locked (TVL) still shows a significant decrease; from $250 billion in early 2022 to $74.21 billion in August. The report stated:

“The last time the TVL was this low was in April of 2021, when the space was just beginning to get momentum. This indicates that the DeFi TVL has decreased by 56% or more since August 2021.”

The report highlights that August was “particularly difficult for the market due to the Tornado Cash crisis,” which saw the industry’s TVL drop 10.47% and lose $8.7 billion. On August 8, the US Treasury Department accused the mixing service of helping to launder more than $7 billion in cryptocurrencies, including $455 million allegedly stolen by North Korean hackers.

After the sanctions, the price of Tornado Cash (TORN) plummeted 45% in two days, losing almost half of its market value.

The Ethereum chain controls 69% of DeFi TVL with $51.47 billion, according to the report — though it lost 11% last month and is down 56.63% since August 2021. Ethereum-based Layer 2 protocols show a bullish signal mainly due to the upcoming Ethereum Merge.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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