December 11, 2023

Web3 TVL grows by $7.3B after Bitcoin's $40K reentry

This past week, the total TVL balance across all 218 Web3 ecosystems tracked by the 0xScope team increased by a whopping $7.33B (+8.23%). The vast majority of Web3 ecosystems, specifically 173 of 218 platforms (79.4%), have grown their TVLs.

Bitcoin's price spiked past $40,000 to begin the week, a level that the top crypto token has not reached since late April 2022. Unsurprisingly, this new phase of $BTC's rally has also lifted several major crypto projects, in terms of both token prices and TVLs.

In this edition of the Web3 Hot Trends report, we discuss the latest trends and bright spots across Web3 ecosystems and projects.

Ecosystem TVL Growth

TVL is an essential indicator of how much capital is currently engaged in the decentralized finance (DeFi) space. Here are some key observations from TVL growth data we tracked this week.

1. ETH brings in $4.7B more TVL, but rivals grow faster. As expected, Ethereum recorded the biggest TVL growth this week, but its 7.39% rise has paled in comparison to blockchain rivals such as Solana (+31.18%), Avalanche (+42.61%), and Cardano (+50.55%). Solana's $549.8M TVL rally has propelled the platform and its current $2.3B TVL within striking distance of Arbitrum's $2.8M TVL and status as the fourth-biggest platform.

2. Avalanche jumps Polygon to take No. 6 rank. This past month, Avalanche has seen a 150% jump in the price of its native token $AVAX, which has now entered the top 10 list of the world's biggest Web3 platforms by market cap. This week, $AVAX grew by 57%, while the platform added $402.2M to its TVL, which now stands at $1.3B TVL. Because of this, Avalanche was able to overtake Polygon ($1.1B) as the sixth-biggest Web3 ecosystem by TVL.

3. Cardano becomes the biggest ecosystem among platforms with below $500M in TVL. Cardano started the year with just under $50M in TVL, but it has steadily grown its locked funds, culminating in a $134.9M increase this week. In just one week, Cardano surpassed Cronos, Kava, Base, Bitcoin, and Gnosis to become the ninth-biggest Web3 platform based on TVL, behind Optimism's $989.6M. The main catalyst for Cardano's new TVL milestone is $ADA's 36% rally over the past 7 days.

4. DefiChain sheds 38.55% of its TVL amid its parent company's woes. The biggest TVL loser this week is DefiChain, which lost $64.7M in locked funds. Cake Group, which owns DefiChain through its DeFi unit Bake, is currently embroiled in a dispute between its co-founders following a major restructuring in mid-November. One of Cake Group's co-founders has applied in court to shut down the company, while another is fighting this effort.

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Project TVL Growth

Diving deeper into the projects’ TVL growth, the 0xScope team spotted positive trends from the projects that stood out this week:

1. Lido grows TVL by $1.5B thanks to new $ETH deposits. ETH liquid staking leader Lido saw its TVL surge by 7.58%, thanks to $ETH's bull run to nearly $2,400 last week and its recent processing of net new deposits worth 76,000 $ETH ($180M).

2. Multiple Solana projects more than double their TVLs. Solana's $549.8M TVL rally is fueled by three projects that have grown their TVLs by more than 100%: Kamino Lend (+256.40%, $47.6M growth), Kamino Liquidity (+129.59%, $26.5M), and BlazeStake (+114.29%, $55.7M). Kamino recently revealed plans to launch a points program, which could set the stage for a future token airdrop.

3. BENQI contributes to Avalanche's bull run. BENQI, the biggest dapp on Avalanche, just added $204M to its TVL (+59.55%), while its $QI token is following in the footsteps of $AVAX's bull run with its own 246% climb over the past week.

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Project User Growth

Project user growth can offer insights into the adaptability and popularity of specific projects. Here’s what stood out:

1. TinyTap leads all projects in user growth for second straight week. TinyTap, the Animoca Brands-owned educational app, has added 94,087 new users this week and more than 240,000 over the past two weeks. Last week, the project concluded an NFT campaign that resulted in the addition of 147,695 new users and the sale of all 720 of its Season 2 Publisher NFTs. Over the past month, the company partnered with Baby Shark creator Pinkfong and attracted investments from Animoca Brands and Binance.

2. Web3 users show rising interest in educational and quest apps. In the shadow of TinyTap's remarkable user growth, another Web3 educational app called Hooked has grown its user base by 121.52% this week. Meanwhile, quest platform Galxe added 37,818 new users (+6.75%), and rival Carv grew its user base by 26.69%.

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Users, as defined by 0xScope’s tools, pertain to real users behind addresses, calculated by 0xScope’s proprietary entity and bot recognition algorithm.

TVL stands for total value locked in a project.

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