Article Source: Footprint Analytics
Author: Stella L (stella@footprint.network)
Data Source: Footprint Analytics Public Chain Research Dashboard
2024 marks an important watershed for the public chain industry, as the focus shifts from technical competition to practical application implementation. During this year, the total market capitalization of public chains grew by 105.3% to reach $2.8 trillion, Bitcoin's price surpassed $100,000, institutional adoption was realized through ETFs, the Ethereum Layer 2 network expanded to over 200 chains, and Bitcoin Layer 2 TVL increased by 1,277.6%, all showcasing the industry's transition from technological experimentation to practical real-world applications. The public chain industry is undergoing a gradual shift from technology-driven development to application-demand-driven development.
Note: Unless otherwise specified, all data in this report is as of December 20, 2024.
Market dynamics: Growth and transformation
2024 has seen unprecedented growth in the public chain industry, with multiple key indicators showing significant expansion.
The total market capitalization of public chains grew by 105.3% to reach $2.8 trillion. Bitcoin's dominance rose to 69.8%, while Ethereum's share fell from 20.4% to 15.2%. The shares of BNB Chain and Solana remained stable at 3.5% and 3.3%, respectively, with other platforms accounting for 8.1%.
The DeFi sector also exhibited strong growth momentum in 2024, with total locked value (TVL) reaching $102.8 billion by the end of the year, a year-on-year increase of 88.6%. Among the top 10 public chains by TVL, Bitcoin and TON showed the most significant growth, each exceeding 2,000%. Aptos, Sui, and Solana also performed well, growing by 754.4%, 677.1%, and 321.3%, respectively. However, both Tron and Avalanche saw declines in their TVL.
The Ethereum Layer 2 ecosystem experienced significant centralization trends in 2024. Arbitrum maintained its lead with a TVL of $10.6 billion and a market share of 41.1%, down from 50.8% in 2023. Base emerged as the dark horse of the year, jumping to second place with a TVL of $5.8 billion (22.5% share), while Optimism ranked third with a TVL of $4 billion (15.8%). Together, these three platforms accounted for 79.1% of Ethereum's L2 DeFi TVL, while former competitors like Blast, zkSync, and Starknet saw declines in their market shares.
Meanwhile, the ecosystem continues to expand, with 50 Rollups and 70 Validium & Optimium currently running on mainnet, plus about 90 chains expected to launch soon, bringing the total number of Ethereum L2s to over 200.
The Bitcoin Layer 2 and sidechain ecosystem has experienced explosive growth, with total locked value reaching $2.6 billion, a substantial increase of 1,277.6% compared to 2023. Core leads with $790 million TVL (30.3% market share), followed by Bitlayer ($500 million, 19.4% share) and BSquared ($330 million, 12.7% share). This growth is not only reflected in TVL, but the number of active chains has also more than doubled over the year, with nearly 20 chains existing.
Competitive landscape: Leaders and challengers
In 2024, the competitive landscape of public chain ecosystems underwent significant changes, primarily characterized by the strengthening of Bitcoin's dominance, Solana's revival, and the rise of emerging challengers.
Bitcoin: From store of value to financial infrastructure
Bitcoin achieved remarkable growth in 2024, with a price increase of 129.2% and a market capitalization growth of 131.7%. This growth was driven by institutional adoption of the spot ETF, the April halving event, and positive sentiment following the U.S. elections. In addition to surpassing the $100,000 price milestone, the Bitcoin ecosystem has seen two key developments:
Institutional adoption has been enhanced: the successful issuance of the spot ETF in January has fundamentally changed the institutional access landscape, with BlackRock's product rapidly reaching $20 billion in scale. Bitcoin has surpassed silver and Saudi Aramco to become the seventh largest asset globally, marking a shift from speculative assets to recognized stores of value.
The rise of BTCfi: The Bitcoin ecosystem has achieved expansion beyond price growth through innovative financial products. Babylon's Bitcoin staking project, Solv Protocol's cross-chain solutions, and Core's Fusion upgrade all showcase an increasingly mature ecosystem. Cross-chain functionality has made progress through the integration of BOB Network with Optimism and the BEVM 'Super Bitcoin' framework, although standardization still faces challenges.
Ethereum: Layer 2 drives ecosystem evolution
2024 is a key year for Ethereum's transformation into a Layer 2-centric ecosystem. Despite a price increase of 55.8% to $3,744, Ethereum faces complex challenges in repositioning its role and maintaining relevance amid the growth of Layer 2 adoption. The successful issuance of the spot ETF in July achieved a degree of institutional recognition, but Ethereum's price performance has clearly lagged behind Bitcoin.
Ethereum's mainnet has undergone significant transformation with the 'Cancun Upgrade', successfully reducing Layer 2 transaction costs and enhancing scalability. However, the migration of activity to Layer 2 has led to a decline in Ethereum's own fee revenue, raising discussions about Ethereum's long-term sustainability. The Ethereum Foundation has responded with various initiatives, including the implementation of Proto-Danksharding (EIP-4844), developing cross-L2 communication standards, and strengthening security requirements for Layer 2 solutions.
The Layer 2 ecosystem has shown significant growth and integration throughout the year. Notable newcomers have enriched the ecosystem, including World Chain, Unichain from Uniswap, and Sony's Soneium. This evolution highlights Ethereum's transition from a pure execution layer to a diversified Layer 2 ecosystem, serving as a settlement and security provider. Although questions remain about revenue models and competitive dynamics, Ethereum's ongoing development in developer activity and innovation in scaling solutions demonstrates its adaptability.
Solana: The third giant
2024 witnessed a strong comeback for Solana, with a price increase of 70.8% and a market capitalization growth of 90.9%, reaching a record high of over $260 in November. This revival began with the January Jupiter airdrop, and Solana's ecosystem activity has been unprecedentedly vibrant. Solana has established itself as a retail trading hub, nurturing a vibrant meme and DeFi community. Besides meme culture, Solana has made progress in various areas: re-staking protocols, modular Layer 2 solutions, and stablecoin innovations. The ecosystem's influence has further extended through the expansion of SVM chains such as Eclipse, Soon, Atlas, and Sonic.
The rise of new forces: TON, Sui, and Base
TON: Social integration drives platform growth
The Open Network (TON) showed significant growth in 2024, with Toncoin prices rising by 149.6% and market capitalization increasing by 84.3%. TON's success primarily stems from its deep integration with Telegram, effectively bridging the gap between traditional social networks and blockchain technology. The platform simplifies the crypto experience through Telegram wallet features and blockchain integration, providing millions of users with easy access to gaming, meme, and DeFi applications, establishing a model for large-scale adoption.
Sui: From Move language pioneer to ecosystem leader
Sui performed brilliantly, with token prices soaring by 461.6% and market capitalization growing by 1,363.8%. This success reflects market confidence in Move language technology and ecosystem development. Sui focuses on DeFi and gaming, including Telegram game integrations and the innovative SuiPlay0X1 game console development, showcasing a comprehensive layout for ecosystem growth. The platform's emphasis on user experience and protocol development creates positive network effects, attracting both developers and users.
Base: Institutional background drives rapid growth
Base's significant growth is driven by several key factors. Coinbase has significantly lowered the entry barrier for mainstream users through its user-friendly smart wallet. The platform has gained substantial momentum from successful social applications like friend.tech and Clanker, while the popularity of memecoins has further boosted activity on the Base chain. The implementation of the 'Cancun Upgrade' has notably reduced transaction fees, enhancing Base's appeal to developers and users.
Key trends in the public chain industry for 2024
New chains are emerging continuously
In 2024, projects began launching their own public chains. DeFi giant Uniswap announced Unichain; the gaming platform Treasure DAO developed a ZK-based Layer 2; the NFT sector saw Pudgy Penguins launch Abstract; and the Web3 platform Galxe introduced Gravity. Furthermore, the emergence of innovative new chains like Monad, Berachain, and HyperLiquid reflects the public chain industry's shift towards specialized blockchain infrastructure.
Institutional adoption: From exploration to strategic integration
Changes in institutional participation methods
2024 marks a decisive shift in institutional adoption from experimental blockchain initiatives to strategic implementation. Financial institutions are leading this transformation, with BlackRock's Bitcoin ETF rapidly reaching $20 billion, and PayPal expanding PYUSD to Solana. Tech giants are showcasing deeper involvement through innovative approaches: Sony launched the Soneium chain for entertainment applications, and Google Cloud expanded its Web3 portal services. Infrastructure developments are particularly noteworthy, with Circle launching native USDC on Sui and Visa integrating Solana for settlement.
Paradigm shift in institutional investment
The public chain sector demonstrated a strong recovery in 2024, with 174 financing events raising a total of $1.7 billion, a 137.1% increase compared to last year. Notably, institutional investment strategies have shifted from purely infrastructure-focused to application-oriented innovations. Early-stage investment events accounted for 21.4% of total financing events, while Series A and B rounds accounted for 31.8%, reflecting the increasing maturity of the ecosystem.
The investment philosophy of venture capital has significantly evolved to prioritize user-facing applications over traditional infrastructure development. This is reflected in substantial investments in consumer-facing projects: Monad raised $225 million to optimize user experience, while Celestia and Berachain each secured $100 million for application-oriented infrastructure.
From technological competition to application innovation
The public chain industry experienced a fundamental shift in 2024, moving from a technology-led approach to an application-driven strategy. This shift challenges the previously dominant mindset of 'build first, users will come naturally'. Although technological capabilities have significantly improved, the increased network capacity has not directly translated into corresponding user growth. For instance, despite hardware limitations, Ethereum's base layer has a higher 'users processed per second' (UOPS) than most Layer 2s, highlighting the complex relationship between technological capability and actual adoption.
This reality has prompted the ecosystem to make a strategic shift. Blockchain platforms are increasingly focused on identifying specific user needs and building targeted solutions, rather than pursuing pure technological advancement. This 'find users and then build' approach is reflected in several successful initiatives. Social financial integration has proven to be particularly effective, with TON's integration with Telegram and Base's friend.tech demonstrating how familiar social platforms can drive blockchain adoption. Simplifying the user experience through account abstraction and familiar authentication methods has significantly lowered the entry barriers for mainstream users.
The evolution of meme culture in the blockchain space further illustrates this shift towards application-oriented development. Initially purely speculative activities have evolved into effective user acquisition channels, particularly on platforms like Solana and Base. These networks have successfully leveraged meme-related initiatives to drive ecosystem growth while building sustainable community engagement. The success of these user-centric approaches indicates that sustainable growth in the blockchain space increasingly relies on understanding and serving user needs rather than merely advancing technological capabilities.
2025 Outlook
As the blockchain industry transitions from technical experimentation to practical implementation, 2025 is expected to be a pivotal year for transformation.
Regulatory clarity
The regulatory environment shows significant improvement, especially in the U.S. A clearer regulatory framework is expected to benefit the entire industry, particularly with progress in stablecoin legislation. This regulatory clarity will facilitate institutional adoption of blockchain through an increase in regulated products and services, while fostering competition among jurisdictions in crypto regulation.
Public chain specialization
The specialization of public chains has become the dominant trend, shifting from generic Layer 1 competition to purpose-driven architectures. Supported by cross-chain infrastructure, application-specific chains and optimized execution environments will see significant development. The 'Rollup as a Service' (RaaS) field is expected to expand, offering more convenient customized blockchain solutions for enterprises and projects.
Technological innovation and AI integration
In 2025, technological innovation will shift from pure breakthroughs to application-oriented infrastructure upgrades. The implementation of Proto-Danksharding will double Blob capacity, driving Layer 2 scaling into a new phase; the development of chain abstraction technology will lead to a more intuitive user experience; cross-chain communication standardization will simplify interoperability.
At the infrastructure level, we expect to see more developments driven by actual demand. Modular blockchain technology stacks will mature, providing specialized solutions for data availability, settlement, and execution layers. Notably, the deep integration of AI technology with blockchain will reshape infrastructure forms: from improving user interfaces to implementing complex on-chain AI agents, from decentralized model training to supporting social finance integration, these innovations will support more complex application scenarios while maintaining security and decentralization, laying a solid foundation for the next round of blockchain innovation.
Conclusion
The past year has proven that sustainable growth relies not only on technological capabilities but also on meaningful user adoption and practical utility. With improved regulatory clarity, advancements in technological infrastructure, and increased institutional participation, the groundwork for meaningful large-scale adoption of blockchain technology is in place. The focus has shifted from 'what's technically possible' to 'what's practically valuable', a change that will define the next phase of growth for the industry in 2025.
