The cryptocurrency industry had a phenomenal year in 2024, with rising coin prices fueling remarkable growth. However, on-chain user activity did not see similar expansion across most relevant chains. According to a report by Flipside, a blockchain growth platform, there was a clear need for networks to focus on offering both quantity and quality on-chain activity to attract users and convert them into valuable contributors.
Coinbase’s Layer-2 Network Takes Off One standout performer in terms of user acquisition was Coinbase’s layer-2 network, Base. The platform’s monthly acquired users grew exponentially in 2024, increasing by 56 times from January. By October, Base’s newly acquired users had reached a record high of 19.4 million, with 13.7 million of those coming from the platform itself – nearly eight times higher than the second-highest performing chain, Polygon.
Ethereum and Base Dominate User Activity In addition to its impressive user acquisition numbers, Base also saw strong growth in its super user count – defined by Flipside as users executing over 100 decentralized finance (DeFi) transactions. This metric increased by 38.4% compared to the next-best performing chain, Ethereum, which saw a 10.7 million super user count.
Interestingly, while Ethereum lagged behind Base in terms of overall user acquisition, it did perform well when it came to DeFi-related super users – coming in at 10.9 million compared to Arbitrum and Optimism’s respective 6.2 million and 1.8 million user counts. Institutional Interest and Acceptance Key Drivers Flipside attributed some of this growth to increasing institutional acceptance of cryptocurrencies.
Significant developments such as Grayscale listing several new cryptocurrencies as “assets under consideration” may have played a role in driving up user numbers across certain chains. Bitcoin User Activity Lags Behind Despite bitcoin’s historic price surge above $100,000 and the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States, Bitcoin’s acquired users only grew by 935,900 monthly.
While there was a 19.2% increase in acquired users during March – when bitcoin hit its peak – there was also a 28.5% drop during November’s post-election rally. This suggests that much of the growth seen during these periods may have been driven by speculation rather than genuine user onboarding. Uniswap Dominates Decentralized Exchange Activity Decentralized exchange Uniswap continued to dominate across major chains, particularly on Base and Ethereum.
Despite this, there remains room for improvement when it comes to providing quality on-chain experiences for users. In conclusion, while the cryptocurrency industry saw remarkable growth in 2024, there remains work to be done when it comes to attracting and retaining on-chain users. Platforms like Base and Ethereum demonstrated strong potential for user acquisition and retention through their focus on quality on-chain experiences.
As the industry continues to evolve, we can expect to see further innovations aimed at improving the user experience and driving adoption.
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