The number of Web3 users surged 40% in the second quarter, setting a new historical record

In the second quarter of 2024, user participation in the Web3 field reached a new peak, and the number of daily unique active wallets (dUAW) reached an average of 10 million. Compared with the previous quarter, this number achieved 40% significant growth.

According to a report released by blockchain analysis platform DappRadar on July 4, the decentralized application (DApp) industry has experienced unprecedented expansion in many aspects and has shown a positive growth trend overall.

Social dApp and NFT market growthSignificant

In the second quarter of 2024, the social decentralized application (dApp) and NFT market performed well and became a significant growth point in the quarter. The growth in user activity of social dApps is particularly significant, with dUAW increasing by 66% year-on-year. This trend is mainly driven by applications such as Fantasy.top and UXLINK. Although the market share of the blockchain gaming space has declined, its user base is still growing.

At the same time, the user activity of decentralized exchanges (DEX) has also seen a significant increase, especially Uniswap and Raydium. Thanks to the addition of meme currency traders, dUAW has increased by 80% and 134% respectively. At the same time, the NFT market also ushered in its highest usage since the first quarter of 2023, with transaction volume reaching $4 billion and the number of transactions exceeding 14.9 million. Magic Eden's market share increased from 17% to 22%, while Blur's market share dropped to 31%.

However, while the number of users grew, the total value of cryptocurrencies locked in DeFi applications fell by $7 billion, a 4% decrease from the previous quarter. The total value locked (TVL) of Tron and Arbitrum decreased by 17% and 9% respectively. At the same time, Ethereum’s layer 2 solutions Linea and Base achieved growth against the trend, with Linea’s TVL increasing by 420% and Base’s TVL increasing by 44%.

DappRadar warned of this, noting that dUAW’s rapid growth may not be sustainable, with part of the growth due to users participating in “airdrop farming” activities, that is, participating in certain activities in order to obtain airdrop tokens. The Blast and zkSync airdrop events in June were one of the factors contributing to this growth. The report highlights the need to deliver an excellent user experience, have a solid development roadmap, and have strong team support in order to achieve sustained growth.

Security issues are still the focus of the Web3 industry

According to the latest report from DappRadar, security issues in the Web3 industry remain severe in the second quarter of 2024, with losses caused by security breaches reaching US$430 million, an increase of 5% from the previous quarter. Among them, Ethereum and BNB Chain are the two chains most affected by attacks, each responsible for about 28% of security incidents. The Solana chain accounted for 8% of the events, and other chains such as Polygon and Arbitrum were also affected to a certain extent.

Among various security incidents, although access control problems only account for 23% of the total number of incidents, the financial losses caused by them account for 75% of the total losses, showing the extremely harmful and serious nature of such problems. In comparison, although flash loan attacks and dragnet attacks each accounted for 13% of the total number of incidents, the losses they caused were relatively small, accounting for only about 1% of the total losses. At the same time, although phishing attacks accounted for only 3% of the total number of incidents, the financial losses they caused also reached 0.4% of the total losses.

The above data shows that the Web3 industry needs to more accurately identify and respond to risk points that may lead to heavy losses in terms of security protection.

Conclusion:

With the significant growth in the number of Web3 users in the second quarter of 2024, we have witnessed unprecedented activity and development potential in the industry. However, DappRadar’s report also reminds us that this growth may be partly due to short-term “airdrop farming” activities, and its sustainability still requires further observation and analysis within and outside the industry. In addition, security issues are still a major challenge that cannot be ignored in the Web3 field, especially in aspects such as access control and flash loan attacks, which require the industry to adopt more stringent security measures and risk management strategies.

Looking to the future, if the Web3 industry wants to achieve healthy and stable development, it must find a balance between innovation and security. This requires not only technological innovation and excellent user experience, but also a reliable development roadmap, strong team support, and an industry-wide emphasis on and active response to security issues. Only in this way can we jointly promote the sustainable progress of Web3 technology and create a more secure, transparent and efficient digital ecosystem for users.

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