Despite the remarkable growth of the crypto industry in terms of coin prices in 2024, there was a surprising lack of growth in on-chain users across many relevant chains. According to a report from blockchain growth platform Flipside, the situation highlights the need for networks to focus on offering both quantity and quality of on-chain activity to attract users and transform them into valuable contributors.
Interestingly, the layer-2 network built by Coinbase, known simply as Base, experienced tremendous growth in both user count and activity throughout the year. Other popular chains like Bitcoin and some Ethereum-based layer-2 solutions struggled to maintain their growth or even attract new users. Base Takes the Lead Flipside’s report reveals that Base’s monthly acquired users increased by an astonishing 56 times this year, reaching a record high of 19.4 million in October.
While the network started slowly in January, it managed to acquire 13.7 million new users by the end of the year – nearly eight times more than the second-highest-contributing chain, Polygon. In addition to acquiring new users, Base also saw impressive growth in its super user count – those executing over 100 decentralized finance (DeFi) transactions.
By the end of the year, Base had attracted 15.1 million super users, which was 38.4% higher than the next chain, Ethereum, which had 10.7 million super users. Ethereum Follows Suit While Base took the lead in terms of both user acquisition and super user count, Ethereum also saw significant growth in its user base.
The second-largest crypto network averaged 1.56 million acquired users per month – more than its layer-2 networks Arbitrum and Optimism combined. Furthermore, Ethereum’s DeFi-related super users amounted to 10.9 million, far surpassing Arbitrum’s 6.2 million and Optimism’s 1.8 million user counts.
Institutional Acceptance Drives Growth Flipside suggests that the growing institutional acceptance of cryptocurrencies may have driven some of this growth across certain chains. For instance, the leading asset manager Grayscale listed several new cryptocurrencies as “assets under consideration,” indicating potential interest from larger investors.
Bitcoin User Growth Lags Behind Interestingly, despite Bitcoin’s historic surge above the $100,000 level and the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States, the number of acquired Bitcoin users only increased by 935,900 monthly. Furthermore, Bitcoin’s acquired users dropped 28.5% during the post-US election rally in November – indicating widespread speculative activity rather than significant new user onboarding.
Uniswap Dominates DEX Space Finally, the decentralized exchange Uniswap continued to dominate across major chains, particularly on Base and Ethereum. The platform’s popularity highlights the increasing demand for decentralized trading platforms as the industry continues to grow.
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