The 2021 ‘State of the Crypto Industry Report’ came from Nansen. The blockchain analytics company shows that crypto has gone multi-chain. Additionally, it has gained lucrative returns and digital collectibles.
Before we dive deeper into the report, let us introduce Nansen to you.
What is Nansen?
It is a blockchain analytics tool that examines 100 million+ labeled wallets. Also, it examines their behavior on Ethereum, Polygon, Avalanche, and a variety of other L1 and L2 blockchains.
It has published its 2021 State of the Crypto Industry Report. This type of report comprises the most significant trends and insights from the cryptocurrency, NFT, and DeFi markets over the past year. It includes statistics and movement in important sectors of the blockchain business. Moreover, Alex Svanevik, Nansen Co-Founder and CEO, has given his perspective for 2022. Nansen intends to keep issuing reports like this. And it is planning to release the reports both annually and on a regular basis, with a focus on diverse sectors.
Nansen’s 2021 Report
According to the research, Ethereum remains the most valuable blockchain in terms of TVL. Moreover, it tops the market capitalization due to its first-mover advantage.
On the other hand, Uniswap was the most popular Ethereum application. It accounted for more than 30% of the gas utilized by the top 20 entities.
As they compete for market supremacy, numerous Layer 1 and Layer 2 blockchains have come up with novel approaches. They aim to overcome problems related to blockchain decentralization. Additionally, the issues include scalability, and security, according to Nansen.
The following are some noteworthy statistics for various supported blockchains:
- Polygon facilitates 300% more transactions than Ethereum. However, the daily gas-charged (in USD terms) is frequently less than 0.5% of Ethereum’s gas prices.
- The number of daily active addresses on the Balance Smart Chain is the greatest of all L1s. BSC’s daily transactions peaked at 1,345 percent of Ethereum’s in late November.
- In September 2021, the Fantom Foundation announced a 370 million FTM grant program. Meanwhile, the daily active addresses on Fantom grew by 440%. Meanwhile, the TVL increased from $1 billion to almost $6 billion in November.
Based on TVL, DeFi grew 1,120% in 2021
The momentum of DeFi continued into 2021, following its rapid surge in 2020.
Nansen emphasized that DeFi has gained 1,120% in terms of value. Moreover, it has received gains in terms of stickiness. It is all thanks to the maturity of stablecoins and the dependability of battle-tested dApps.
Nansen also tracked “smart money” movements. Moreover, it highlighted a few key events, such as when DeFiance Capital got $MUSE before the formal funding announcement, followed by a doubling of the token price upon public introduction.
The value distribution of stablecoins revealed that whale wallets with over $1 million accounted for more than half of stablecoin volume through 2021. Not to mention that it has been gradually increasing.
USDT’s dominance has been undermined by increased governmental scrutiny on Tether in 2021.
However, USDC appeared to have found its place as the preferred stablecoin in decentralized trading in 2021. It has surpassed USDT as the second most valuable stablecoin on Ethereum.
NFTs have swept the globe
In 2021, NFTs exploded in popularity. It went from a niche use case to dominating blockchain platforms. Also, they became famous for social media profile images. CryptoPunks and Bored Ape Yacht Club were two of the most popular projects. Moreover, celebrities like Stephen Curry and Jay-Z began utilizing NFTs as Twitter profile images.
During the year, the market reached two peaks: one in May and the other in late August.
The single largest trading day in terms of volume occurred on August 29. It was when sales volume reached an all-time high of 132k ETH ($422m). The market completed the year with a total sales volume of approximately 4.6 million ETH ($17 billion).
We can expect to see Crypto loans and options growing adoption by institutions as more of them explore the crypto markets,” said Nansen co-founder and CEO Alex Svanevik.
“While few corporations, such as Tesla or MicroStrategy, will keep BTC directly on their balance sheets. Moreover, the ability to pay with crypto may eventually make it popular,” he said.
“Additionally, we see a surge in institutional crypto ownership in 2022, possibly eclipsing retail.”