The following report belongs to the new series of blockchain user behavior reports. A set of DappRadar reports aims to provide users with different perspectives of the blockchain industry, combining traditional financial behavior analysis with blockchain indicators. This article analyzes the trend from the perspective of the blockchain industry, and at the same time determines the modes of DeFi, NFT, and gaming.
By enabling immutable, accessible, and traceable ledgers, multiple companies have adopted blockchain as the backbone of their future operating models for different use cases. In addition, the industry is evolving at an incredible rate, with multiple decentralized applications (dapps) and use cases being created every day. Therefore, we think we need to understand who the main users of the blockchain are first? How do they work? In addition, we will also introduce successful cases in this industry. What is the specific behavior of whales? What are their common trends? In this report, we aim to analyze and draw some existing patterns based on current user behavior.
First, we will analyze global aspects and trends, such as geography and devices used for interaction. Then, we will delve into the industry to show the relationship between DeFi users and NFT users, and vice versa. After that, we will try to draw some patterns between DeFi/NFT specific indicators and industry indicators. Finally, we analyze the Ethernet Square, the most important of the top few NFT series of purse holders, in order to observe the behavior of whales encryption.
The U.S. and Asia lead the blockchain industry in usage
Mobile devices dominate the blockchain scene
Users tend to interact with DeFi and NFT at the same time
Macro indicator model
Top wallet analysis-NFT perspective
The interest of NFTs mainly comes from the United States and Indonesia, with Russia and India also participating. As far as DeFi is concerned, the United States is still the largest source of traffic, with Brazil, Thailand, Russia and China also particularly prominent.
The economic argument of playing games to make money is supported by emerging economies; the flow of game dapps is led by the Philippines, followed by India, Brazil, Venezuela, and interestingly the United States is among them.
From the perspective of global trends, the mobile market share is surpassing PC users; DappRadar’s data also supports this global perspective, with 53% of users connecting via mobile devices, while the PC usage rate is about 46%. Since May 2021, these numbers have been changing.
According to DappRadar’s portfolio tracking tool, 85% of DeFi users also interacted with NFT. Compared with May, these figures have increased by 10%, which shows that NFT has become more and more popular in the past two months.
Over time, NFT collections have become more and more accepted. Among the top 5 Ethereum collections, Bored Apes Yacht Club is the most widely distributed; only 4% of the series are owned by the top 5 wallets and currently have more than 5,100 independent owners.
On the other hand, the whale concentration index of CryptoPunks and Avastars is much higher, 9% and 21% respectively; however, the total number of holders has increased in the past two months.
The U.S. and Asia promote the blockchain industry
DappRadar attracted more than 500,000 users in July 2021. In addition to useful data-driven insights, such as NFT and DeFi pages and rankings, DappRadar also provides a variety of products, such as portfolio trackers, TokenSwap functions, and NFT valuation tools.
In the first part of this overview, we analyzed the overall audience of DappRadar. This analysis can understand the potential behavior of the blockchain industry as a whole. After that, we will delve into the most popular market segments, especially DeFi, NFT, and games.
Analyzing the period from July 1st to August 7th, we found that the Philippines is the country with the most users, followed by the United States. Between Vietnam and Indonesia, more than 65,000 users use our products. If the figures for China and India are included, Asia’s participation in this industry is dominant. Also worth noting is the strong influence in Brazil, Russia and the United Kingdom. The BRIC Group is fully representative in this industry.
Deeply researching the blockchain field, we first analyze which users are interested in DeFi in July 2021. For DeFi and NFTs and game analysis, we considered the click-through rate of each category.
As far as DeFi is concerned, we see strong influence from the United States. The United States seems to be the country most interested in DeFi, followed by Brazil. Asia has also developed a strong interest in the DeFi industry. Binance Smart Chain (BSC), Polygon, and Ethereum are well represented in China, India, and Russia, respectively, and promote a large number of uses. However, Thailand is the country that is most interested in this field. In Europe, Spain and the United Kingdom, users usually use DeFi dapps to interact.
On the one hand, this result is expected. Countries such as the United States, the United Kingdom, and China have important capital markets, which is the result of a natural comparison with DeFi in a more traditional way. On the other hand, it is quite encouraging to see countries like Brazil and Thailand get involved. Gaining popularity in this type of country will certainly promote large-scale searches. Because of their large population.
In terms of NFT, the situation is slightly different. The United States seems to be most interested in NFT collections and markets, but it has higher profit margins compared to other countries. The United States has traditionally been one of the top markets for all kinds of collectibles, from rare toys to sports memorabilia. It is not surprising to see their interest in the digital realm. In Asia, Indonesia stands out. Russia and India also seem to be interested in NFT, but to a lesser degree than DeFi.
Finally, the hottest area in this industry is gaming. The money-making model of playing games has had a huge impact on the industry. The micro-economy generated by blockchain games is being accepted by emerging economies. Our traffic insights support this argument. The Philippines’ interest in the gaming industry has increased dramatically. Other countries visible in this category include the United States, Brazil, Thailand, Vietnam, and Venezuela.
Mobile devices dominate the blockchain scene
Although geographic analysis shows where users come from, it is also important to understand how users access industry data. According to DappRadar’s July network data, 53.4% of users connect via smartphones, while 45.7% use desktops as their connection method.
Compared with June, overall usage increased by 16%, while the ratio between the two most important channels remained unchanged. In addition, our data is consistent with various publications focusing on global trends. In global trends, mobile market share is gradually surpassing desktop users. In the next few months, as more and more dapps prepare for the development of Android and iOS devices, this trend deserves attention.
After analyzing global trends such as geographic location and equipment market share, we delved into the usage indicators and patterns of blockchain.
Users tend to interact with DeFi and NFT at the same time
In this section, we only focus on those wallets that use our portfolio tracker feature, and only consider the Ethereum ecosystem. After analyzing the wallets that interacted with DappRadar throughout July, we found that the growth trend of NFT began to overlap with existing DeFi users.
When analyzing wallets that interact with DeFi dapps through different protocols, only 15% of wallets only interact with DeFi dapps, and 85% of wallets have transactions with the NFT collection or the market to some extent. Obviously, the strong performance of NFT continues. Compared with the data in May, NFT usage by DeFi users has increased by 10%.
On the other hand, compared to May, we saw a 6% increase in wallets connected to Ethereum NFT. 75% of wallets with NFTs have also interacted with Ethereum DeFi dapps. 25% of NFT wallets specialize in this area.
We can conclude that the NFT hype is real. More experienced blockchain users (such as DeFi users) are likely to fully realize the potential of NFT and its multiple applications. In addition, according to Dune analytics, there are now more than 3 million DeFi users on Ethereum. According to the existing population model, there are about 2.5 million NFT users. With new collections coming out every day, investment in the NFT field has also set a record. There is no doubt that this field will have huge room for growth in the medium term.
Macro indicator model
Cryptocurrency is one of the most important pillars of the blockchain industry. We believe that cryptocurrencies are considered under the efficient market hypothesis, which is applicable to traditional capital markets with rational investors and time-sensitive variables.
In this section, we will compare the macro indicators that are widely used to analyze cryptocurrencies. These indicators are important for understanding the fields of DeFi and NFT respectively, and also help to classify the blockchain industry as an aggregated blockchain indicator of overall variables. .
Note: DeFi users shown in the following analysis consider DeFi and DEX dapps, while NFT includes collectibles and markets.
- BTC price
- ETH price
- ETH fuel fee (GWei)
- Fear and Greed Index
- BNB price
- MATIC price
Although not an official indicator, the Fear and Greed Index (FGI) is widely used by cryptocurrency traders as a unit to measure the overall sentiment of the entire industry. FGI is a number ranging from 0 to 100, categorizing the market from very fearful (0) to very greedy (100). We compared FGI with the number of independent users in the industry since April and found interesting results.
Source: DappRadar and the Fear and Greed Index of the Crypto Industry
We saw an important upward trend in the industry’s independent users in early April, and a downward trend in mid-May. Due to the collapse of cryptocurrency prices, FGI changed from greed to fear within a few days. Naturally, the hype generated by the industry was interrupted by falling prices, halting the growth trend. Nevertheless, from the end of May to mid-July, there were still about 1 million to 1.2 million unique daily users in this still worrying market. Around July 20, the industry received attention again, which may be related to the popularity of NFT and the support of the recovery of cryptocurrencies, which prompted FGI to become greedy again.
Another analysis that reflects the latest state of the industry is the comparison between Ethereum’s fuel price and the independent users of Ethereum, BSC, and Polygon. In our latest industry report, we emphasized the proliferation of multi-chain models because the market requires lower transaction fees and faster processing speeds than the current version of Ethereum.
With the price of Ethereum’s fuel fee reaching historical highs, this trend has become more apparent. For example, on May 12, one day after the fuel price approached 300 GWei, the adoption rate of BSC rose to 990,200 individual wallets. The fluctuation between these two indicators lasted until mid-July, when the play to earn game began to run on Binance Network.
Source: DappRadar and Etherescan.io
Once the community realizes that there are options that can improve the effectiveness of investors, the market will respond accordingly. Initially, it was BSC that attracted thousands of blockchain users, but slowly, they also realized that Polygon was another option in the industry. Once Ethereum’s fuel price reaches its peak, the multi-chain model has been significantly strengthened.
In addition, when analyzing DeFi and NFT separately, we can also draw some conclusions. Starting from DeFi, although there are obvious correlations between macro and blockchain variables, such as the correlation between the price of a certain asset and the total value (TVL) locked in its agreement, the usage pattern in DeFi is closely related to the price of its assets . For example, the price of Ether still seems to determine the development trend of DeFi.
Source: DappRadar and Coingecko
Although both BSC and Polygon have made tremendous progress recently, Ethereum is still ahead of all protocols in terms of TVL. The market reacted as expected, the price of Ether rose, in this case, promoted the growth of interest in the entire DeFi market by users who are eager for more revenue.
On the other hand, the NFT field has not yet formed a trend related to its underlying assets. Although the price of Ether fluctuates in nature, the adoption, quantity, and usage of NFTs will only continue to increase. Although as of today, there is no clear correlation between these two indicators, it will be meaningful to see how a more mature NFT market reacts to greater volatility in ETH prices.
Source: DappRadar and Coingecko
Whale wallet analysis-NFT perspective
Finally, we analyzed the top five wallets with the largest number of assets (NFT) in the five most important collections of Ethereum. As we have seen, NFTs are constantly growing and evolving, so analyzing the rationale behind the top holders of the most important collections may help to understand these NFT projects.
NFT collection under analysis
- Bored Ape Yacht Club (BAYC)
- Art Blocks
CryptoPunks has become the standard for NFTs and has been growing recently. At the time of writing, the base price of the series has exceeded $115,000, which prevents most industry users from accessing these pixelated characters. Since punk is regarded as a unit of storing value, it is natural to still see a higher degree of concentration. The Whale Concentration Index of CryptoPunks is about 9%, which means that the top 5 holders have about 900 Punks, or more than $103 million.
In addition, we also found that Punk users are very loyal to Larva Labs. Among the top 5 holders, there is no BAYC in the portfolio, and they have 948 Meebits and 388 Art Blocks respectively.
The concentration of whales in Meebits (7.2%) is very similar to that of Punks. They also follow the principle of not holding BAYC. Among the top 5 users of Meebit, two users play the same role in CryptoPunks.
Among the collections in the industry, BAYC is the most widely distributed. Only 4% of the total collection is owned by the top 5 wallets, and the actual number may be lower. One of BAYC’s greatest strengths is its community. The main holders of Bored Apes comment on the importance of having as many owners join as possible on Twitter and Discord. The more community participants, the more likely BAYC will become stronger. BAYC currently has more than 5,100 independent users, which is the highest representative (51%) in the entire NFT field. On the other hand, Avastars is the NFT collection with the highest whale concentration index, at 21%.
With the increasing maturity and development of the NFT field, the concentration of whales has been diluted, which is a good trend. Trends such as the segmentation of NFTs may lead to a completely different situation in the blue-chip collectibles series, distributing ownership from a few people to thousands of investors.
Behavioral finance is widely used in traditional finance to identify users’ behavior patterns to explain their economic decisions. Although there are obvious differences between blockchain and capital markets, there are also similarities. For example, we clearly see that with the popularity of smart phones on a global scale, mobile devices have also become the first choice of the blockchain industry.
We have also observed that the interest in our industry mainly comes from the United States and Asia. Despite regulations, legislation and the outflow of miners, individuals are gradually realizing the huge advantages of the industry. By promoting the concept of the potential of cryptocurrency and blockchain as a whole to regions such as the Philippines, Thailand, and Venezuela, new trends such as the micro-economy of profitable games are driving the pace of mass adoption.
In addition, we can assume that investors’ behavior in the crypto field is rational. As the democratization of assets brings transactions to the public, decentralization has played a vital role. The market sometimes feels overconfident, leading to active and speculative trading, pushing the entire industry to always seek mass adoption. DeFi users are increasingly participating in NFT because the field uses added value to reward users in different ways.
After analyzing the top Ethereum NFT whale users, we also saw a trend of good behavior. Although the market has not yet had any impact on the increase in NFT demand, some crypto macro indicators are being affected by the NFT movement. Specifically, the fuel price of ETH. We have seen a bidding war on fuel prices for two consecutive weeks as users try to get popular favorites such as Stoner Cats, CryptoPunks, and most recently pudgpenguin. As collectibles become less and less from the wallets of a few people, NFTs are creating communities where real value outside of the digital industry is generated.
As discussed, we stand in front of the rational market behind the industry. Behind this industry, DYOR (do your own research) is very important. Avoiding certainty and representative heuristics is the key to success in this type of industry. There may be two ways to generate prejudice against certain types of people or products, so it is very important to understand the logic behind this field.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/the-characteristics-of-blockchain-user-behavior-from-the-perspective-of-nft/
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