By Footprint Analytics
Public chain research report in August 2024
In August, the cryptocurrency market was volatile, with both Bitcoin and Ethereum experiencing significant declines. Layer 1 blockchains generally suffered from the market downturn, however, Tron bucked the trend and grew strongly. In the Bitcoin Layer 2 field, the development momentum is impressive, and the TVL of various scaling solutions has increased significantly. At the same time, the Ethereum Layer 2 network is under great pressure, but it is also continuing to evolve, and the participation of heavyweight players such as Sony has become a highlight of the ecosystem. Despite the shrinking market value, innovation in Bitcoin and Ethereum Layer 2 remains the key to future growth.
The data for this report comes from Footprint Analytics' public chain research page . This page provides an easy-to-use dashboard that contains the most critical statistics and indicators for understanding the public chain field and is updated in real time.
1. Market Overview
Both Bitcoin and Ethereum have seen significant declines in August. The Bank of Japan unexpectedly announced an interest rate hike in late July, a move that sent ripples through markets. Strategies such as short volatility strategies and foreign exchange carry trades saw a significant decline in returns, leading to a sharp drop in the value of cryptocurrencies in the first week of August. Both Bitcoin and Ethereum hit their lowest point of the month on August 7.
Data source: Bitcoin and Ethereum price trends
The Bank of Japan’s unexpected rate hike in late July sent ripples through markets. Strategies such as short volatility and FX carry trades saw returns fall significantly, leading to a sharp drop in the value of cryptocurrencies in the first week of August. Both Bitcoin and Ethereum hit their lowest point of the month on August 7.
Continued selling pressure continued throughout the month, exacerbated by factors such as multiple government actions and the legacy of Mt. Gox, although the impact of these factors has gradually weakened.
Meanwhile, Ethereum is undergoing an important transition that has caused uncertainty among some investors. The blockchain plans to scale by moving more transactions to the Layer 2 network. This year, the Ethereum Layer 2 network has seen a significant increase in activity, with giants such as Sony launching projects such as Soneium in this ecosystem. However, the shift in activity to Layer 2 has led to a decrease in Ethereum's fee income, which could affect the value of Ether.
At the end of the month, after Telegram founder Pavel Durov was arrested in France, the market's focus increasingly turned to the relationship between blockchain technology and digital privacy. Although Federal Reserve Chairman Powell clearly "hinted" at the possibility of a rate cut in late June, market sentiment remained generally negative throughout the month.
2. Layer 1
As of the end of August, the total market value of blockchain cryptocurrencies fell by 12.1% compared to the end of July, settling at $1.74 trillion. The market is still led by Bitcoin , Ethereum , BNB and Solana, with market shares of 67.2%, 17.4%, 4.5% and 3.6% respectively. It is particularly noteworthy that the absolute value of Bitcoin's market share increased by 2.4%, while Ethereum's market share decreased by 2.3%.
Data source: Market capitalization of public chain tokens in August 2024
Bitcoin closed at $59,017, down 8.7%. Ethereum's decline was even more pronounced, closing at $2,516, down 21.4%.
Among the top 15 chains by market capitalization, Tron is the only chain that has achieved double growth in token price and market capitalization this month, with TRON's price rising by 23.1% and its market capitalization increasing by 22.7%. In contrast, other chains are showing a downward trend.
Data source: Public chain token price and market value at the end of August 2024
Tron stood out amid market volatility, thanks to its ability to seize the meme craze, triggering a surge in on-chain activity. The launch of SunPump, the first meme fair launch platform on Tron, significantly increased user engagement.
The BNB chain has also introduced new policies and incentives to promote on-chain meme-related activities, with Simon's Cat, TOkenFi, and FLOKI leading in trading volume over the past 30 days.
Data source: BNB chain popular memecoins
Additionally, several major financial institutions expanded their blockchain portfolios this month. Top asset manager Franklin Templeton expanded its blockchain fund to include Avalanche. Meanwhile, Grayscale Investments launched the Avalanche Trust and a new Sui fund.
As of the end of August, the total TVL in the DeFi sector was US$64 billion, down 16.8% from the end of July.
Data source: TVL of public chains at the end of August 2024
Among the top 15 chains by TVL, Sui is the only one to achieve growth, with a monthly growth rate of 41.8%. NAVI Protocol, the largest DeFi project on Sui, provides lending and liquid staking products. Its TVL surged by 72.0%, from $140 million on August 1 to $230 million at the end of August.
Although Polygon's TVL fell 1.3% from July, the prediction market Polymarket attracted a lot of attention. Affected by the US election cycle, Polymarket's monthly trading volume increased by 22.2% month-on-month to US$470 million, and the number of traders soared by 46.1% to 83,000. Polymarket's TVL increased by 19.6% in August to US$110 million, ranking third on the Polygon chain, behind AAVE and Uniswap. However, 78.0% of Polymarket's total trading volume is election-related, raising questions about whether it can maintain this growth after the US election.
Data source: Polymarket data dashboard
At the same time, Telegram founder Pavel Durov was arrested in France, which had a direct impact on TON’s performance . In August, TON’s TVL plummeted by 53.1%, and institutional investors withdrew to avoid potential risks.
3. Bitcoin Layer 2
As of August 31, the TVL of Bitcoin Layer 2 (including sidechains) reached US$1.09 billion, a 5.8-fold increase since January 1, 2024, and an astonishing 18.7-fold increase since January 1, 2023 .
Bitlayer leads the field, accounting for 32.7% of the total TVL, followed by Core with 16.3%, Rootstock with 14.6%, and Merlin with 12.0%.
Data source: Bitcoin Ecosystem Public Chain TVL
Looking at individual DeFi projects on a single chain, the top 10 projects account for 64.6% of the total TVL, among which Avalon Finance (Bitlayer), Pell Network (Core) and MoneyOnChain (Rootstock) rank at the top, accounting for 16.7%, 7.2% and 6.6% respectively.
Data source: Bitcoin Ecosystem Public Chain TVL
When considering the multi-chain TVL of the projects, Pell Network operates on seven chains and leads with a 22.9% market share, while Avalon Finance operates on three chains and follows with a 22.8% market share. The top 10 projects account for 77.5% of the total market share.
Data source: Bitcoin DeFi project TVL (multi-chain summary)
For a more in-depth analysis of Bitcoin Layer 2, please refer to our latest research report jointly released with CoinMarketCap: " BTCFi: Analyzing the Bitcoin DeFi Ecosystem Based on On-Chain Data ".
4. Ethereum Layer 2
As mentioned earlier, Ethereum faced many challenges in August, and its Layer 2 network was no exception.
Arbitrum One , Optimism , and Base continued to dominate in terms of TVL market share, holding 50.2%, 20.0%, and 8.2% respectively, with little change in TVL compared to the previous month.
DeGate’s TVL increased significantly by 20.6%, Scroll increased by 7.4%, and Taiko increased by 7.1%. However, Blast decreased by 18.8% and zkSync decreased by 8.8%.
Data source: Ethereum Layer 2 Overview in August 2024 - Rollups (Bridge Related Indicators)
Overall, user activity on Ethereum Layer 2 remains sluggish, suggesting that a new round of innovation and more attractive applications are needed to re-attract users. Against the backdrop of Bitcoin Layer 2’s strong performance this year, the Ethereum Layer 2 ecosystem may need new narratives and stronger user engagement to regain momentum.
Soneium has become a hot topic this month. On August 23, Sony Blockchain Solutions Labs, jointly initiated by Sony Group and Startale Labs, announced the launch of Soneium, a new Layer 2 network based on Ethereum. The network will use Optimism's OP Stack technology, spanning the fields of gaming, entertainment and finance, combining Web3 innovation with consumer applications.
Soneium
In the week following the announcement, Soneium made rapid progress, including the launch of the “Minato” testnet, the launch of the “Soneium Spark” program for developers, and a partnership with Transak to provide global fiat onboarding services. As industry giants like Sony continue to enter the blockchain space, there is growing optimism about bringing more users into the Web3 ecosystem.
5. Blockchain Games
In August, a total of 1,492 games were active on various blockchain networks, down 5.45% from July. BNB Chain, Polygon , and Ethereum led the market with 20.2%, 17.4%, and 17.0% market share, respectively.
Ronin , opBNB, Nebula (SKALE subnet), and NEAR performed well in terms of DAUs, reaching an average of 1.34 million, 691,000, 349,000, and 321,000 respectively during the month. As of the end of August, these chains accounted for 28.0%, 23.8%, 8.8%, and 6.6% of the DAU market share, respectively.
Data source: Daily active users of various public chain blockchain games
Ronin's DAU market share continued to decline during August, from 38.1% on August 1 to 28.0% on August 31. Despite this , Ronin's average DAU in August was still nearly twice that of opBNB, which followed closely behind. This downward trend was mainly caused by the performance of the game Lumiterra , whose DAUs dropped from 600,000 at the beginning of the month to 150,000 at the end of the month.
Additionally, on August 6, the Ronin cross-chain bridge was suspended due to a white hat hacker attack that revealed a critical misconfiguration in the cross-chain bridge upgrade proposal. Approximately $12 million worth of cryptocurrency was transferred. Although the issue was quickly resolved and all funds were recovered, the incident had a certain impact on the activities of the Ronin ecosystem.
Conversely, opBNB’s DAU share increased from 17.5% to 23.8% in August. As of August 31, its market share almost doubled from 13.1% on July 1. SERAPH: In The Darkness, a game launched on opBNB in mid-July, has gained significant traction, with its DAUs increasing from 187,000 on August 1 to 515,000 by the end of the month.
Nebula's market share also increased, from 7.6% to 8.8%. As a SKALE subnet that adopts the "zero gas fee" model, Nebula's growth was driven by games such as Yomi Block Puzzle, moteDEX, and Haven's Compass.
For more blockchain game industry trends, please read " Blockchain Game Research Report in August 2024: User Growth and Cryptocurrency Market Volatility Coexist ".
6. Financing
In August, there were 12 financing events in the public chain field, with a total amount of US$118 million, an increase of 20.1% from July. It is worth noting that four of the financing events did not disclose the specific amount.
Public chain financing events in August 2024 (data source: crypto-fundraising.info )
The increase in total funding this month was mainly due to a major funding event. The largest funding round in July was Caldera’s $15 million Series A, while in August, Story Protocol’s $80 million Series B funding significantly boosted the overall data.
PIP Labs, a core contributor to Story Protocol, received this financing with the support of venture capital giant Andreessen Horowitz (a16z). Story Protocol aims to revolutionize intellectual property management by transforming intellectual property (IP) into modular, programmable "IP Lego". These assets can be authorized, managed, and monetized through smart contracts on the blockchain. Story Protocol gives creators the ability to embed licensing and royalty terms directly into their intellectual property, allowing for greater control over their data. The project's mainnet is expected to go live later this year, which has aroused great expectations.
Story Protocol
In addition to Story Protocol, three other Layer 1 blockchains, including Quai Network, U2U Network, and Particle Network, received new financing in August. On the Layer 2 side, multiple projects also successfully raised funds, including Bitcoin Layer 2's Ark and Nexio, Ethereum Layer 2's Essential, Corn, and Reddio, Solana Layer 2's Soon, and other Layer 2 projects such as Rivalz Network and Lync.
One emerging trend worth noting is the increasing attention paid to Move Stack. Two Layer 2 blockchains, Nexio and Lync, which are powered by Move Stack, completed a new round of financing this month.
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The content of this article is only for industry research and communication purposes and does not constitute any investment advice. The market is risky and investment should be cautious.
Link to this article: https://www.hellobtc.com/kp/du/09/5410.html
Source: www.footprint.network
