Flipside report: Which project will have the most user growth in 2023?

Author: Mike Dalton, Cryptoslate; Compiler: Deng Tong

Flipside Crypto said in a report shared with CryptoSlate on January 25 that blockchain users and activities will increase throughout 2023. is growing.

The analytics firm wrote:

“Cryptocurrencies have been experiencing extreme volatility of late, with wild swings in on-chain activity and user sentiment over the last year...but ultimately, the past few months ended on a high note , user growth and activity surged across nearly all major chains. ”

Flipside observed the growth of users who had made at least two transactions on the blockchain.

A chart in the report shows that eight major blockchains experienced 62 million user growth. The company noted that Ethereum (ETH) and Polygon (MATIC) are seeing the most user growth, with approximately 15 million acquired users per year.

At the same time, Bitcoin gained 10.7 million users in 2023. Other chains have seen relatively little growth, as shown below:

Blockchain acquires users through Flipside Crypto

Flipside notedthat user acquisition peaked in May 2023 with 5.8 million users executing their second on-chain transaction on various blockchains.

The company added that user acquisition began to rise in March following the collapse of Silicon Valley banks, which may have reduced trust in centralized financial services and pushed users towards decentralization alternatives. Flipside added that user acquisition gradually declined after May before rising again in December.

It also points out specific trends for each blockchain. Flipside said Polygon (MATIC) had a record month in January, gaining 2 million users that month. It added that when Avalanche (AVAX) launched its euro stablecoin in March, accounts surged to 481,000.

In addition, Arbitrum (ARB) and Optimism (OP) attracted hundreds of thousands of users, probably due to airdrop activities.

Finally, Flipside noted that Coinbase’s Layer 2 network Base got off to a strong start when it launched in August 2023, attracting 633,000 users that month. However, the chain grew less towards the end of the year, according to the report.

Predicted trends in 2024

When predicting future trends, Flipside pointed out that NFT-related activities will decrease in 2023, and the trend will shift to decentralized finance (DeFi) activities.

Therefore, it believes thatthe next activity cycle will be equally dominated by various DeFi activities rather than NFT transactions. Flipside said thatDecentralized exchange (DEX) and liquidity mining will continue to be the dominant applications. Additionally,it predicts the rise of new DeFi applications, such as Ethereum’s re-staking protocol Eigenlayer.

The company stated that users are likely to interact with multiple blockchains at a higher rate in 2024, although most users will continue to interact with a single blockchain.

Flipside also predicts that users will increasingly interact with Layer 2 networks in 2024. It noted that although the number of users interacting with multiple blockchains in 2023 is a minority, these users primarily interact with Layer 2.

The company added that higher transaction fees during the next bull run in the crypto market may prompt Layer 2 networks to reduce costs on the end-user side to remain competitive. This may in turn increase interest in related governance tokens.

Finally, Flipside predicts that new blockchains will be launched in 2024 to meet new needs, and these blockchains may provide specialized and diverse use cases.