The Ethereum network remains at the forefront of decentralized application (DApp) adoption, leading in both volume and deposits. Despite the allure of lower transaction fees on rival chains like Solana and BNB Chain, which enhance metrics such as unique active addresses, there’s no barrier to well-capitalized players potentially inflating Ethereum’s DApp volumes.
The recent uptick in Ethereum’s network activity diverges from the general trends in the cryptocurrency market and seems to contradict other usage indicators. Although direct manipulation cannot be confirmed, it’s important to recognize that even with a significant transaction fee of $2.4, data can be skewed, especially in decentralized finance (DeFi) applications where deposits may surpass the $1 billion mark.
**Chart: Leading Blockchains by 7-Day DApp Volume in USD (Source: DappRadar)**
Ethereum stands out as the sole network among the top 20 to witness a volume boost, recording a remarkable 83% increase over the previous week. In contrast, similar platforms like BNB Chain, Polygon, Solana, and TON saw their volumes shrink by an average of over 30%. Ethereum’s address count of 475,980 seems modest when compared to BNB Chain’s 1.18 million and Solana’s 1.62 million.
The swell in Ethereum’s volume did not correspond with a rise in user count. With a decrease of 8% in unique active addresses interacting with DApps, Ethereum’s user base shrank compared to the previous week. This drop is intriguing, considering the substantial increase in volume.
**Chart: Top Blockchains by DeFi Total Value Locked in USD (Source: DappRadar)**
Data reveals a 17.5% decline in Ethereum’s total value locked in DeFi applications over a week, while rivals like Solana and Avalanche saw an influx of deposits. The Ethereum network’s DApp transaction count remained static during this surge in volumes, hinting at the need for a deeper dive to decipher this irregularity.
**Chart: Leading Ethereum DApps by 7-Day Volume in USD (Source: DappRadar)**
A staggering 422% surge in Balancer’s volume over seven days, amounting to $40.6 billion, was the main driver of Ethereum’s volume growth. This figure is thirteenfold the total activity on the BNB Chain for the same timeframe. Yet, Balancer’s remarkable volume spike did not align with an uptick in other key metrics; the DApp experienced a 5% reduction in unique addresses and a 14% fall in transactions over the week.
Setting aside Balancer’s impact, Ethereum’s volume growth over the past week would have seen a 5% dip, with this single DApp representing 59.5% of the network’s entire volume. While dominance by one DApp isn’t rare — PancakeSwap largely drives BNB Chain, and Uniswap commands nearly a 50% share on the Polygon network — the reported growth in Ethereum’s activity merits a cautious interpretation due to potential skewing by one DApp’s figures.
Assessing the real demand behind Balancer’s volume spike is complex. Even marginally profitable trades within the DApp don’t provide a definitive picture of user motives. For example, the Binance exchange flagged the Balancer (BAL) token for potential delisting on July 1, which might relate to the DApp’s extraordinary activity, though drawing a direct correlation is intricate.
This article is for informational purposes only and does not constitute investment advice or recommendations. All investments and trading moves carry risks, and individuals should perform their own due diligence before making decisions.