In July 2024, AI decentralized applications (dapps) took the lead in the Web3 space. These AI dapps now account for 28% of all dapp activity. They have now surpassed traditional sectors like gaming, which fell to 26%.
Quick Take:
- AI dapps overtake traditional gaming and represent 28% of dapp activity.
- Daily Unique Active Wallets surged to 15.9 million with a 78% increase.
- Social dapps now hold 20% of the market, with 3.1 million dUAW.
- DeFi TVL saw a 5% increase from the previous month, reaching $175 billion.
Daily Unique Active Wallets (dUAW) saw an increase of 78% from the previous month and reached 15.9 million. This record-breaking activity level underscores the bullish sentiment in the Web3 space despite broader economic challenges. The “other” category, including AI and high-risk dapps, has become the dominant force in the industry.
Social Dapps and DeFi Trends
The social sector also experienced a significant rise by taking over 20% of the dapp market with 3.1 million dUAW. DeFi showed the smallest increase in activity. However, it maintains its relevance with a Total Value Locked (TVL) of $175 billion, marking a 5% increase from the previous month.
NEAR continues to lead in chain performance due to popular dapps like HOT Game and Kai-Ching. It was followed by opBNB which is boosted by Particle Network and Revox | ReadON. Up next was Base, who saw increased activity due to Uniswap and the game dapp BLOCKLORD Dynasty.
DeFi’s TVL matched Q1 2024 levels by reaching $175 billion. Ethereum remains the dominant force in the DeFi landscape, as it holds 66% of the total TVL. Solana is also riding high with its memecoin trading and DeFi activities boosting its value. Layer-2 network, Linea became the 10th largest chain by TVL amid its airdrop rumors.
Moreover, Avalanche stood out this month by digitizing 42 million car titles on its blockchain through the California DMV. This practical application of Web3 technology indicates a potential direction for future adoption.
A Downturn for the NFT Market
The NFT market saw its trading volumes drop to $561 million. This marks a solid 41% decrease from the previous month. Nonetheless, the number of NFT sales only decreased by 11%. This shows that there is a sustained demand but at lower prices. Ethereum remains the market leader with a 29% share, and it is closely followed by Polygon at 24%.
OpenSea reclaimed its top spot in the NFT marketplace rankings. It achieved the highest trading volume at $174 million and led in the number of traders. This resurgence was driven by the Liberty Cats NFT collection.
Web3’s Constant Battle with Exploits and Hacks – Losing $250 Million
The Web3 industry faced a significant setback with $250 million lost to exploits and hacks in July. This is a 400% increase from the previous month.
On July 19, 2024, a major attack led to the theft of $230 million by compromising the signers’ Externally Owned Accounts (EOAs) and altering the Multisig implementation. Li.Fi, a cross-chain DeFi protocol, suffered a loss of $8 million due to an arbitrary call vulnerability. A vulnerability in a third-party module led to a $4 million loss for the Terra blockchain.
These incidents underscore the critical importance of security in the Web3 space. Dapp developers must prioritize safeguarding their platforms to protect against significant financial losses.
Nonetheless, July 2024 was a dynamic month for the Web3 industry. The rise of AI dapps and the social sector and the steady growth in DeFi paints a promising picture for the future. However, challenges still persist for the overall industry.
