By Rajagopal Menon “Crypto is dead” refers to the times the industry goes through a near death experience.“Long live crypto” follows immediately after “Crypto is dead,” expresses optimism and confidence in the continued existence, potential, and resilience of the industry.It emphasises the belief that, despite the challenges, virtual digital assets (crypto) are here to stay and will continue to evolve and thrive in the long run.The world of cryptocurrency has experienced its fair share of ups and downs over the years.From meteoric rises to devastating crashes, the volatile nature of this digital asset class has been a topic of much debate and speculation.However, as we wade through the year 2023, the state of crypto seems to be evolving in ways that are challenging the notion that crypto is dead.In fact, a closer look at the data reveals a thriving ecosystem with several key indicators pointing towards a bright future for the industry.
In this article, we will look at some key numbers put out by a16z, a leading VC, on the state of crypto.Active users increasing One of the most significant signs of life in the Crypto space is the increasing number of active users.The number of active cryptocurrency users has been steadily growing, reaching a record high in 2023.Infact, March 2023 saw 15 million active addresses, more than double the number seen two years ago while prices were still high.
One probable explanation is that there are more and more ways to interact with blockchains and web3 applications.From DeFi to web3 games (over 700 of which were released last year), a slew of innovative applications generate addresses for its users to engage with without the need to download or connect a wallet.
Exploding transaction numbers The report also highlights the impressive growth in transactions within the crypto ecosystem.Despite the occasional market volatility, the total value of transactions conducted using virtual digital assets has been steadily increasing.One of the most notable trends is the explosion of blockchain transactions.The report highlights that the total number of transactions conducted on various blockchain networks has skyrocketed.Reduced transaction fees have also been a significant driver of increased blockchain transactions.
In the early days of crypto, gas fees were often high due to limited network capacity and high demand.However, with the advent of scaling technologies and improvements in network efficiency, transaction fees have reduced significantly.NFT creators raking it in The report highlights that NFT creators have been earning substantial revenue from the sale of their digital assets, with some high-profile sales reaching millions of dollars.There is no denying that there has been a dip in recent times, but ongoing experimentation will determine the most effective methods for linking communities interested in these collections with their creators.
As the industry continues to evolve, it is expected that further exploration and innovation will take place to optimise the connection between NFT communities and creators, paving the way for new possibilities in the realm of digital ownership and creativity.Brands are betting big on Web3 Brands can serve as a lagging indicator of the development and adoption of crypto products.It shows that they see value and potential in the industry.Active developers increasing Last month, about 30K developers contributed to or built on crypto projects, a figure that has consistently increased by more than 60% over the last three years.Active developers are also playing a crucial role in shaping the future of crypto.
The report reveals that the number of developers working on blockchain and cryptocurrency projects has been steadily increasing.This is a positive sign, as it indicates a growing ecosystem of talent and expertise dedicated to improving the technology and infrastructure that underpins cryptocurrencies.Developer interest and activity are critical components of the crypto space, driving innovation and progress.As Chris Dixon pointed out, what nerds do on the weekend is what regular people will do on weekdays in the future, highlighting the pivotal role of developers in driving mainstream adoption.
Verified smart contract deployments are at an all time high In the world of crypto development, deploying verified smart contracts takes on a distinct meaning.It signifies an intentional effort to share one’s code with others, inviting scrutiny and collaboration.
It serves as an additional barrier to cross, signalling a higher level of commitment and engagement.The minimum entry point for developers is often starting a repository on GitHub, a platform that facilitates code sharing and collaboration.
Taking it a step further, downloading web3.js or ethers libraries indicates a deeper level of experimentation and tooling around with blockchain technology.However, the pinnacle of commitment is deploying a smart contract and having it verified, as it signifies not only building something but also actively seeking others to read, use, and potentially remix and recombine the code in a production system.These incremental levels of commitment serve as evidence that developers are actively exploring and experimenting with blockchain technology, a promising sign of their dedication and progress in the space.The paper attempts to reconcile the disparity between the noise of transitory price swings – and the data that tracks the signals that count, such as the long-term advancement of Web3 technology.Overall, the analysis shows a healthier business than market prices may suggest, as well as a consistent cycle of development, product introductions, and continued innovation.In conclusion, the notion that crypto is dead is far from the truth.
The State of crypto report for 2023 paints a picture of a thriving ecosystem with increasing active users, growing transactions, NFT creators earning substantial revenue, a rising number of active developers, and innovative applications of smart contracts.While challenges remain, cryptocurrencies have evolved into a legitimate asset class with significant potential for disruption across various industries.The author is vice-president, WazirX Follow us on Twitter , Facebook , LinkedIn.
