The transaction volume of decentralized applications (DApp) has hit almost $270 billion in 2020 as per the latest report from DAppRadar. This represents a whopping 1178% increase compared to last year’s volume of only $21 billion. The report also indicated that 95% of the transaction volumes came solely from Ethereum’s DeFi.
The latest DApp Industry Report has also revealed that there have been large capital inflows from Bitcoin to Ethereum in 2020. For instance, on Jan. 1 the price of ETH was 0.018 BTC, compared to its current price of 0.028 BTC.
The main reason for this can be attributed to the booming attraction of DeFi yield farmings. Tokens such as Wrapped Bitcoin (wBTC) and RenVM’s renBTC had a key role in bringing Bitcoin’s liquidity to the Ethereum ecosystem.
DappRadar also found that only 10 DApps solely contributed to 87% of Ethereum’s total transaction volume. The top three of these DApps include DeFi Swap, Uniswap, and Compound.
The DappRadar report finally concluded that the COVID-19 pandemic contributed to the growth of the DApp ecosystem in an alternative search for decentralized solutions to basic universal income and worldwide database management systems.
DappRadar’s report further estimated that more than $120 million was stolen in 2020 in 12 major incidents throughout the year. Improper smart contract audits as well as exploiting even minute vulnerabilities can be contributed to this.
DeFi’s booming summer was not all rosy as the Ethereum network included higher gas fees compared to last year. The network also suffered from high congestion and issues of scalability.
The congested Ethereum blockchain led to the growth of other DApp platforms including Binance Smart Chain, Tron, WAX. These alternative blockchain platforms as a whole helped in contributing to the rise in DApp transaction volumes.