State of Polkadot Q4 2024
Key Insights Polkadot’s monthly transactions rose from 20 million in January to nearly 60 million in November 2024. This 200% increase was driven by strong performance from rollups like Neuroweb and Frequency. Polkadot improved interoperability after launching Snowbridge, a trustless Polkadot-Ethereum Bridge and Hyperbridge, which leverages zk-proof and coprocessor technology to securely transfer assets across multiple chains, including Ethereum, Optimism, Arbitrum, Base, BNB, and Gnosis. Polkadot’s Spammening test on its live sister network, Kusama, reached 143,343 TPS at 23% capacity, with a projected 623,000 TPS at full utilization. The network maintained stable performance under heavy loads. Polkadot remains a leading hub for blockchain innovation and supports over 1,200 monthly active developers who benefit from its native SDK, previously called Substrate. DOT’s market capitalization rose by 71% QoQ to a two-year high of $16.4 billion and signaled strong investor confidence. Primer Polkadot (DOT) is a distributed blockchain computing platform that acts as a base layer for other sovereign blockchains, initially called parachains, for validation and shared security. Polkadot was built using Substratet, a blockchain developmental framework now better known as Polkadot SDK. Furthermore, Polkadot’s base layer is known as the Polkadot Chain (aka Relay Chain), which utilizes a Nominated Proof-of-Stake (NPoS) consensus mechanism, and its state machine is compiled to WebAssembly (Wasm). The Polkadot Chain’s core function is to validate and provide security to its rollups. Agile Coretime, released during Q3 2024, enhances the network’s scalability, cost-efficiency, speed, and flexibility by dynamically allocating computational resources. This feature replaces the previous system of leasing single cores through auctions with an on-demand blockspace model, adjusting resource availability based on network demand. This approach helps prevent resource wastage during periods of low activity and mitigates congestion during peak times. Lastly, parachains (rollups) on Polkadot can communicate with one another through the Cross-Consensus Mechanism Format (XCM). The XCM is a messaging format that standardizes messages between Polkadot’s chains, allowing for greater interoperability. Website / X (Twitter) / Discord Key Metrics Ecosystem Analysis Rollup Extrinsics Transaction activity across the Polkadot ecosystem increased sharply in the second half of 2024 and rose by approximately 200%. Monthly transactions grew from 20 million in January to nearly 60 million in November 2024. Neuroweb, developed by Origin Trail, led in Q4 2024 with an average of 26 million monthly transactions and recorded a 136% QoQ increase from 12 million in Q3. Frequency also experienced a surge in activity and rose from a monthly average of 7 million monthly transactions in Q3 to a monthly average of 9 million in Q4. Phala, Litentry, and Mythos also contributed to Polkadot’s increasing transaction volume. This surge in activity was further fueled by the adoption of cross-chain bridges like Snowbridge. This trustless bridge, connecting Polkadot and Ethereum, launched in June 2024 and has seen considerable adoption, with TVL exceeding $70 million by 2024 year-end. Snowbridge allows token transfers between the two networks, which contributed to the overall increase in transaction volume on Polkadot. Its key features, such as community ownership, trustless operation, and XCM compatibility, have made it a popular choice for users looking to move assets between Polkadot and Ethereum. On November 7 2024, Polkadot introduced Hyperbridge, the first verifiable, multichain bridge connecting Polkadot, Ethereum, Optimism, Arbitrum, Base, BNB, and Gnosis. Hyperbridge improves blockchain interoperability by utilizing a coprocessor model for complex computations and employing zk-proofs with onchain finality validation to strengthen security. Two testnet cycles proved Hyperbridge's effectiveness, which processed over 600,000 cross-chain messages. Sixty-six independent relayers validated the network. This approach tackles security challenges associated with traditional cross-chain approaches, such as differences in consensus mechanisms and data mobility. The interoperability approaches introduced this quarter have strengthened Polkadot's utility and set a benchmark for cross-chain communication. As these technologies continue to mature and gain adoption, Polkadot is well-positioned to support a more interconnected and efficient decentralized ecosystem. XCM The Cross-Consensus Message Format (XCM) is a standardized messaging format and language that enables seamless communication between rollups and other consensus-driven systems. XCM plays a crucial role in facilitating interoperability and complex cross-consensus interactions. It allows blockchains to exchange messages, perform operations, and transfer assets, among other use cases. In Q4 2024, Polkadot’s XCM activity increased. Daily XCM transfers averaged 1,841 (+53% QoQ), and other messages averaged 255 daily (+300% QoQ). With an average of 2,096 per day, total daily XCM messages increased by 66% QoQ. The quarter saw an expansion of high-yield farming opportunities across the Polkadot ecosystem. Bifrost launched a 1 million DOT incentive program in October 2024, which targeted liquidity pools on platforms like StellaSwap and Beamswap. The impact was immediate, with the BNC-DOT pair on StellaSwap reaching a 423% Annual Percentage Rate shortly after the program's launch. The success of these incentive programs was evident in the rapid growth of TVL across various pools. For instance, the vDOT-DOT pool on StellaSwap experienced a twentyfold increase in TVL, reaching $622 million by late October, while still maintaining a 19.92% APR. Rollup Addresses Despite the rise in transaction volume during Q4, active addresses in the Polkadot ecosystem declined. The average number of daily active addresses fell to 11,500 in Q4 from 14,000 in Q3. In Q4 2024, the average monthly active addresses on Polkadot’s Relay Chain reached 122,919, while rollups recorded an average of 68,847. Among rollups, Moonbeam, Acala, and Mythos ranked highest by active addresses with market shares of 15%, 3.6%, and 2.7% respectively during the quarter. Development Polkadot boasts one of the largest developer bases in the crypto industry. According to Electric Capital, in October 2024, Polkadot had 1,261 monthly active developers, with 460 of them classified as full-time, placing the network fourth behind Ethereum, Base, and Polygon. Artemis also tracked developer data and reported an average of 117 weekly active core developers and 420 active ecosystem developers in Q4 2024. Financial Analysis Market Capitalization After cooling off with the broader market in Q3 2024, DOT’s market capitalization expanded in Q4. During Q4 2024, DOT’s market capitalization increased 71% QoQ, from $6.2 billion to $10.2 billion. It peaked in early December at $16.4 Billion — a two-year high. DOT’s market cap rank shifted from 16 to 19 during Q4 2024, ranking it above Bitcoin Cash and Pepe. Transaction Fees The Polkadot Chain’s total transaction fees tends to be relatively lower compared to its competitors due to the network's structural design. In Q4 2024, the Relay Chain benefitted from Polkadot's ecosystem increasing transaction volume. The Relay Chain went from capturing $113,737 in fees in Q3 to $492,141 in Q4, a 333% QoQ increase. The average transaction fee increased from $0.02 to $0.03. Treasury The Polkadot Treasury is financed through block rewards, validator slashing, transaction fees, and staking inefficiencies. Treasury funds held in a system account are allocated for expenditures within a 24-day spend period, with any unspent funds subject to a 1% burn. Notably, all treasury expenditures are executed automatically on-chain. The passage of OpenGov has transformed the referendum lifecycle and decentralized the decision-making process, leading to increased treasury activity. The Polkadot Treasury expanded its asset distribution across the relay chain, Asset Hub, and the Hydration chain to manage assets such as DOT, USDT, and USDC. According to Dotlake, Treasury spending in 2024 increased 3.2 times compared to 2023. Allocations included $58.8 million for outreach efforts, $28.7 million for development, and $17.2 million for economy-related initiatives. Spending reached its highest levels in April and May before gradually declining in the following months. The Polkadot Treasury balance at the end of Q4 2024 was $168 million. Supply Polkadot’s native token DOT serves three primary purposes: governance, staking, and accessing blockspace. DOT has an inflationary monetary policy and no maximum supply. Its monetary policy adjusts according to network conditions, increasing staking rewards when the staked amount falls below the ideal rate to prevent security compromises, and decreasing rewards when the rate is exceeded to maintain liquidity. In July 2023, Polkadot introduced a new burning mechanism for revenues from its coretime model, following community consensus. This change directs all coretime revenues to be burned, while maintaining a steady treasury inflow through a guaranteed portion of the inflation rate. Specifically, the treasury now receives at least 20% of annual inflation if the ideal staking rate (60%) is achieved, leading to a decrease in staking rewards from 16.67% to 13.33%. The community also voted for a decrease in inflation to further reduce the maximum inflation rate from 10% to 8% in the first year, then further gradually decreasing, which could bring staking rewards down to 10.67% under similar conditions. Burning coretime revenues marks the second burning mechanism within Polkadot, alongside the existing practice of burning 1% of treasury funds monthly. While the initial impact of coretime burning will be small due to existing lease commitments expiring in 2026, it is expected to gradually grow over time. As of Q4 2024, Polkadot’s supply metrics included a circulating supply of 1.5 billion (+7.3% QoQ) and a staked supply of 782 million DOT, resulting in 51% of the eligible supply being staked (+13.4% QoQ). Network Analysis Usage The central Polkadot Chain (aka Relay Chain) has several primary functions, including securing and connecting rollups. Consequently, end users typically transact and use the network primarily through the rollups. The Polkadot Chain does support some end-user functionalities, including token transfers, staking, validator elections, and governance voting. With RFC-0032: Minimal Relay, it is proposed to migrate several of these subsystems into system rollups. Polkadot Chain activity increased in Q4 2024. Daily active addresses increased to 9,000 (+45% QoQ), daily returning addresses increased to 6,700 (+28% QoQ), and daily new addresses increased to 2,300 (+139% QoQ). Security Polkadot uses a Nominated Proof-of-Stake (NPoS) model designed to decentralize the validator set. Validators receive payments every 24 hours based on their completion of payable actions known as era points. This model incentivizes nominators to stake with lower-staked validators to earn higher rewards, resulting in a consistently decentralized validator set. The number of active validators increased to 500 due to referendum 888, which enables two approval voting protocol improvements. The Web3 Foundation launched the Decentralized Nodes Program in October 2024 to support validators. Validators can apply for up to two nodes per network, selected based on technical expertise, reliability, and ecosystem engagement. Selected participants serve a four-month term starting in November 2024, with potential renewal. As of Q4 2024, there were 31,200 nominators (-14% QoQ). Nomination Pools, which allow users to pool their DOT tokens together on-chain to nominate validators and receive rewards, numbered 233 at the end of Q4 2024 (-1% QoQ). Governance OpenGov, the new governance model for Polkadot, has transformed the referendum lifecycle and decentralized the decision-making process. The system allows multiple referenda to run concurrently, enabling faster decision-making. The Council and Technical Committee have been replaced by the Fellowship, a developer DAO that ensures decentralization through community voting, checks and balances, and flexible delegation based on conviction and token commitment. Governance participation increased substantially in 2024. Referenda submissions rose by 150% and voter turnout by 40% compared to 2023. One of the most significant governance actions of the quarter was Referendum 1200, which increased the active validator set size from 400 to 500. This change passed with 99.7% of votes in favor (1.2 million DOT). Another notable referendum included Referendum 1271, which set Polkadot inflation to 120 million DOT per year. The proposal aimed to provide a more predictable and sustainable economic model for the network. The community's ability to make such economic decisions shows the decentralized nature of Polkadot's governance model. The Spammening A recent report on Polkadot’s Kusama network provides insights into its scalability and stability through a large-scale stress test called The Spammening. This experiment took place between November and December 2024 and examined the network's performance under extreme transaction loads in real-world conditions. The results showed that Polkadot reached a peak throughput of 143,343 transactions per second (TPS) while using only 23% of available computing resources. If all 100 cores were utilized, the network’s theoretical throughput could exceed 623,000 TPS. The test included two approaches. Parity Technologies conducted a network-wide stress test, while a separate community-driven test involved participants manually generating transactions. Both tests ran on live networks with active economic activity, providing a practical view of Polkadot’s capabilities. The experiment applied Polkadot 2.0 features such as Asynchronous Backing, Agile Coretime, and Elastic Scaling. These upgrades improved transaction throughput and resource management. The network maintained stable block times of around six seconds, and finality remained consistent at approximately 16 seconds. A comparison with other blockchain networks showed Polkadot’s technical advantages. Kusama handled more transactions per second than networks like Solana and Aptos, even with limited resources. These results show that Polkadot can support high-demand applications DeFi and gaming. The report also examines the complexity of measuring performance within Polkadot’s multichain architecture. Instead of relying on traditional TPS metrics, it suggests using aggregate throughput and validator efficiency for a clearer assessment. Future plans include additional tests to further analyze performance and scalability under different conditions. Upcoming stress tests will take place on Polkadot’s main network, where higher node capacity and stronger connectivity could lead to better results. These efforts build on current findings and set new benchmarks for blockchain performance in real-world environments. Roadmap Polkadot's core technology evolved in Q4 2024 with advancements that improved current capabilities and laid the groundwork for Polkadot 2.0. The quarter saw improvements intended to increase network efficiency and reduce entry barriers for developers. Asynchronous Backing and Agile Coretime were fully implemented and contributed to the surge in transaction volumes across parachains. The final piece of the Polkadot 2.0 architecture, Elastic Scaling, is due to go live before the end of Q1 2025. Building on these improvements, Polkadot focused on further technological advancements: JAM Technology Development: On November 11, Gavin Wood shared insights into Polkadot's JAM (JOIN-ACCUMULATE MACHINE) technology through a global tour of lectures, presentations, and blog posts. This signaled a push for broader understanding within the ecosystem. On November 29, Parity Technologies released the Polkadot JAM Rust SDK. This provides developers with tools to build on the network using JAM technology. This release supports the developer community and supports progress within the ecosystem. Developer Tools and SDKs: The introduction of the Polkadot Unity SDK for Gaming by Ajuna Network empowers game developers to integrate blockchain into their projects. Unity powers over 50% of the top 1,000 mobile games worldwide, positioning this SDK as a potential driver for Web3 gaming adoption. Additionally, new APIs, including the XCMFee Payment Runtime API and XCMDryRunApi, were introduced to improve cross-chain efficiency. Roadmap to Polkadot 2.0: Developments in Q4 2024 aligned with the broader goal of fully implementing Polkadot 2.0 in 2025. Gavin Wood emphasized horizontal scaling as the preferred approach, which aligns with Polkadot's decentralized nature. The roadmap includes the concept of a JAM Grid, designed at creating a decentralized Web3 supercomputer, alongside rebranding efforts to simplify user interactions. The focus of engineering collective Parity Technologies, the main technical contributor to Polkadot, is the launch of Ethereum-compatible smart contracts, native to Polkadot, amid widespread improvements to the existing developer experience, including lower barriers of entry, ultra-low costs, and easier access to stablecoins. Polkadot's technical development continues with efforts to expand transaction capacity, provide better tools for developers, and optimize network operations. As Polkadot 2.0 nears, these changes are expected to increase system performance and compatibility across the ecosystem. For a deep dive on Polkadot 2.0, check out our report Polkadot 2.0 Rebirth: An Overview. Closing Summary Polkadot experienced a surge in transaction volume and technical progress in Q4 2024. Monthly transactions climbed to 60 million by November, with Neuroweb and Frequency in the lead. Agile Coretime introduced a dynamic resource allocation system, which optimizes scalability to meet demand fluctuations. With the launch of Snowbridge, a trustless Polkadot-Ethereum Bridge, and other cross-chain solutions like Hyperbridge, asset transfers became more efficient and reliable. By December, DOT’s market capitalization had grown 71% QoQ, reaching $16.4 billion at its peak. Transaction fees followed suit, increasing in response to greater network activity. Treasury spending supported outreach and development by channeling resources into initiatives that expanded the ecosystem. OpenGov restructured governance, which helped streamline decision-making and encouraged broader community involvement. Looking ahead, Polkadot plans to complete the transition to Polkadot 2.0, paving the way for the introduction of radical new technologies like JAM, which involves a complete replacement of the Polkadot Chain (aka Relay Chain).
Source: Qorban Ferrell — Published: 2025-02-06T18:00:00ZState of Futureverse Q4 2024
Key Insights ROOT’s market capitalization increased 131% QoQ in Q4 2024, rising from $22 million in Q3 to $50 million, driven by a 66% QoQ increase in token price. Total transaction fees rose 14% YoY to $13,000, while transaction count dropped 13% YoY to 17,000. The ASTO market cap increased 174% QoQ, from $10 million in Q3 2024 to $27 million in Q4 2024. Girin Labs, in partnership with Futureverse, launched the Girin Wallet, a non-custodial wallet integrated with The Root Network and XRPL. AI-generated transactions on XRPL reached over 334,000, with NFT mints exceeding 4 million following Jen’s beta launch last month. Updates to the authentication SDK introduced improved user interfaces and OAuth features, while ASM’s Altered State advanced toward alpha testing, showcasing the potential of generative AI for creating detailed 3D models. Primer Futureverse, founded in 2022, integrates blockchain, AI, and immersive experiences to build a decentralized metaverse. Formed from the merger of 11 companies, it offers a unified ecosystem with a three-layer technology stack: Infrastructure Layer (Root Network): A Layer-1 blockchain with EVM compatibility, asset interoperability, multi-token economy, and NFT-specific runtime. Its modular design allows app creation and asset management without coding expertise. The Root Network uses XRP as its primary gas token, ensuring XRPL interoperability, while its "Any-Token Gas" system allows seamless fee payments in multiple approved tokens. Protocol Layer: Includes decentralized identity (DID), secure data storage (SSDS), access control (Doughnuts), and communication (Sylo Network) protocols, enabling secure data sharing and decentralized messaging. Altered State Machine (ASM) powers user-owned AI models for intelligent interactions. Content Layer: Engages users with NFT assets, gamified experiences, and AI-driven narratives. Futureverse’s multi-token economy, led by ROOT, supports governance, staking rewards, and ecosystem activities. For a full primer on Futureverse, refer to our Initiation of Coverage report. Website / X (Twitter) / Discord Key Metrics NFT Activity Futureverse hosts various unique NFT collections, each contributing to the broader ecosystem's engagement and appeal. Some notable collections include ASM AIFA All-Stars, ASM Aifa Genesis, and ASM Brains, which are part of the Altered State Machine (ASM) ecosystem, leveraging AI technology to enable dynamic, evolving NFTs. Collections like ATEM Membership Cards and Dr. Grordborts: Rayguns offer unique utilities and high-quality collectibles with strong storytelling elements. The FLUF World ecosystem stands out as a cornerstone of Futureverse, with sub-collections such as FLUF World: Burrows, FLUF World: Buzzies, and FLUF World: EGGs, offering immersive metaverse experiences. Other collections, like Muhammad Ali: The Next Legends, which features Boxers and Gym Bags, tap into sports fandom and digital identity. Additionally, PartyBear and The Seekers cater to niche communities within Futureverse, providing interactive and engaging collectibles. NFT activity on The Root Network in Q4 2024 remained subdued, with total sales (USD) holding steady at $1.1 million, unchanged from Q3 2024. However, this represents a sharp 71% YoY decline compared to $3.7 million in Q4 2023, reflecting continued contraction in market value. Similarly, the total sales count increased 21% QoQ, from 3,800 in Q3 to 4,200 in Q4, but was still 54% lower YoY, down from 10,000 in Q4 2023. Despite an increase in sales count, the stabilization of sales value QoQ suggests a shift toward lower-value transactions. This aligns with broader NFT market trends, where speculative activity has diminished, and buyers have shown greater interest in more accessible assets. The lack of high-profile NFT releases or major promotional events in Q4 likely contributed to subdued performance, as did macroeconomic factors impacting discretionary spending. ROOT Market Cap The ROOT token’s market capitalization rose to $50 million in Q4 2024, marking a 131% QoQ increase from $22 million in Q3 2024, as its price climbed 66% QoQ, from $0.02 to $0.03. However, ROOT’s market cap declined 51% from $102 million at the start of the year, while the token price fell 23% YoY, dropping from $0.04 in Q4 2023. ASTO Market Cap ASTO is the native token of the Altered State Machine (ASM) ecosystem, a core element of Futureverse's vision for an open metaverse. ASM integrates AI with blockchain to create intelligent, adaptive NFTs that evolve based on user interactions and environmental factors. ASTO serves as both a utility and governance token, enabling activities such as training AI models, facilitating interactions, and powering transactions within the ecosystem. ASTO's market capitalization fluctuated significantly over the past year. It peaked at $46 million in Q1 2024, driven by ecosystem activity and speculative interest, but declined sharply in subsequent quarters, falling 72% QoQ to $13 million in Q2 and further to $10 million in Q3 2024. In Q4 2024, ASTO's market capitalization increased 174% QoQ to $27 million, reflecting a 10% YoY growth from $25 million in Q4 2023. This recovery is likely driven by advancements in ASM’s AI protocols and renewed interest in the ecosystem, reversing declines from earlier quarters. This recovery aligns with advancements in ASM’s AI protocols, growing integration with the THINK Protocol, and renewed interest in AI-powered assets within the Futureverse ecosystem. The transition toward on-chain AI agents and Non-Fungible Intelligence (NFI) could further impact ASTO’s role and adoption in Q1 2025 and beyond. Network Activity Total fees on The Root Network stem from transactions and associated costs. In Q4 2024, transaction fees on The Root Network decreased 31% QoQ, from $18,000 in Q3 to $13,000, but rose 14% YoY from $11,000. Total transactions also fell 33% QoQ, from 25,000 to 17,000, and declined 13% YoY from 19,000. Despite the YoY drop in transaction volumes, the fee increase can be attributed to a 46% rise in the average fee per transaction, which grew from $0.5 in Q4 2023 to $0.7 in Q4 2024. However, the average fee per transaction decreased slightly QoQ by 4%, from $0.8 in Q3. The spike in transaction fees earlier in the year, particularly during Q2 2024, was driven by the launch of The Third Kingdom, a strategy simulation game by Futureverse and Walker Labs. In Q3 2024, the implementation of the Substrate v1.0.0 upgrade improved network efficiency by increasing transaction throughput and raising the block gas limit from 11 million to 15 million. These enhancements optimized transaction handling, reducing average fees QoQ in Q4 despite lower transaction volumes. The upgrades also positioned the network for better scalability and cost-effective operations, aligning with its long-term architectural goals. Over the past year, The Root Network exhibited mixed user engagement and growth trends. Average active addresses decreased 31% QoQ, from 32 in Q3 2024 to 22 in Q4 2024, indicating a decline in short-term activity. However, active addresses remain up 38% YoY, growing from 16 in Q4 2023, reflecting steady long-term adoption driven by network upgrades and ecosystem expansions. Similarly, average new addresses fell 25% QoQ, from an average of 1.5 new addresses in Q3 to 1.8 in Q4 2024, continuing a downward trend in onboarding new users. This represents a significant decline in new address creation, down 82% YoY from 10 new addresses in Q4 2023. The drop may reflect reduced outreach initiatives or market conditions impacting user acquisition, as Futureverse prioritizes building a robust infrastructure. Developer Activity Developer activity on the Root Network provides essential insights into its technical progress and ecosystem engagement. Quarterly commits measure the pace and volume of updates and new features, highlighting development momentum. Active developers indicate the size and engagement of the technical community contributing to the network, reflecting its capacity to attract and retain talent. Active repositories demonstrate the diversity of projects and tools being developed, illustrating the scope of innovation within the ecosystem. Developer activity on The Root Network continued to decline in Q4 2024. Quarterly commits dropped 26% QoQ, from 377 in Q3 to 279 in Q4, representing a 72% YoY decline from 1,000 in Q4 2023. Similarly, the number of active developers decreased 34% QoQ, from 105 to 69, and fell 63% YoY from 184 in Q4 2023. In contrast, the number of active repositories remained relatively stable, decreasing slightly by 9% QoQ from 11 to 10, though this represents a 33% YoY decline from 15. Despite fewer contributors, the consistent repository activity suggests that the focus has shifted toward maintaining and optimizing existing projects rather than initiating new ones. These trends reflect a contraction in developer participation, potentially due to the completion of major milestones earlier in the year or shifting priorities. Qualitative Analysis Partnerships and Developments Promptopia Introduced as a Generative AI Tool: Futureverse’s Readyverse Studios, created in collaboration with Ready Player One author Ernest Cline and producer Dan Farah, focuses on creating connected digital experiences for the metaverse. In Q4 2024, the studio introduced Promptopia, an AI-powered platform showcased at Permissionless III. Built on The Root Network, Promptopia enables users to create 3D environments, objects, and music using simple text prompts. It integrates technologies like Altered State for 3D modeling and Jen for music generation, simplifying creative processes and supporting user-generated content. By allowing players to dynamically shape virtual worlds without technical expertise, Promptopia aims to make creativity more accessible and interactive within the metaverse. Launch of the Girin Wallet: Girin Labs, a Web3 venture studio supported by funding from the XRP Ledger Japan and Korea Fund and Ripple, has accelerated the development of the Girin Wallet and the Lotus Protocol, a DeFi platform for lending and liquid staking on The Root Network. In collaboration with Futureverse, Girin Labs launched the Girin Wallet, a user-friendly, non-custodial digital wallet designed for seamless integration with The Root Network and XRPL. Available on iOS and Android, the wallet simplifies digital asset management with features like social login and multichain compatibility. Future updates will introduce staking, lending, and user incentives, enhancing its functionality and driving the adoption of XRP and ROOT tokens. Material World Protocol Launch in The Third Kingdom: The Material World Protocol was implemented with the launch of The Third Kingdom: Episode 1. This system supports minting, trading, and using in-game resources across multiple games, creating a shared economy on The Root Network. Players can now convert harvested materials into valuable assets beyond individual games. At the same time, developers can integrate these resources into their applications, reducing development costs and fostering a larger player base. Paris Developer Training Workshop: Futureverse organized its first developer workshop in Paris, focusing on practical training for building applications on The Root Network. Led by Futureverse experts, the sessions covered blockchain fundamentals, interoperability, and tools like the Asset Register. XRP Ledger Token Bridge Expansion: The Root Network has upgraded its cross-chain capabilities with an updated XRPL Token Bridge, enabling the bridging of ROOT, XRP, ASTO, SYLO, and ZRP tokens. This functionality is supported by Dexter, a decentralized exchange built on the Root Network, and FuturePass, a blockchain identity platform within the Futureverse ecosystem. These updates are designed to enhance liquidity and facilitate cross-chain interactions. Pundi X and Futureverse Partnership: Futureverse has partnered with Pundi X, a blockchain platform focused on cryptocurrency transactions, to integrate blockchain, AI, and payment solutions into the open metaverse. The collaboration includes an AI DATA Omnichain Layer on The Root Network, designed to reward users for contributing AI data. Pundi X’s platforms, such as the f(x)Wallet and XPOS system, will connect with The Root Network to improve payment interoperability. Futureverse communities will also use Pundi X’s SocialFi platform, Purse+, to facilitate rewards and engagement. Animoca Brands Collaboration: Futureverse and Animoca Brands formed a partnership to incorporate Futureverse’s technology into Animoca’s portfolio of over 400 Web3 products. Ecosystem and Community Activities Expansion of The Third Kingdom: The Third Kingdom, a story-driven metaverse project within the Futureverse ecosystem, expanded its gameplay with features such as resource minting, prestige mechanics, and collectible integration. The upcoming Episode 2, scheduled for 2025, will introduce Mycelium harvesting and material refinement, further enhancing the game’s interactive elements. Generative Art and Tradeverse Updates: The Layers of Reality generative art series debuted with the Physical Matters collection on The Root Network. Tradeverse also added a peer-to-peer trading feature, enabling users to exchange digital assets directly and securely. New Game Additions: The Root Network expanded its gaming portfolio in Q4 2024 by adding two new titles, CryptoGearz and MINEWARZ, further cementing its position as a hub for Web3 gaming. CryptoGearz is a mech strategy game that combines tactical gameplay with blockchain technology, offering players the ability to customize and compete with digital mechs in a decentralized environment. MINEWARZ is a mining tycoon simulation game where players build and manage operations to extract resources, leveraging blockchain features for in-game asset ownership and trading. Zerpmon Launch: Zerpmon is a trading card game built on The Root Network, combining tokenized digital assets with competitive gameplay. Players can collect, trade, and use unique tokenized cards in strategic battles, making it a dynamic and engaging experience in the metaverse. Over 950 collectibles were minted within 24 hours of the launch, generating $100,000 in ROOT tokens. Technological Advancements Substrate v1.0.0 Upgrade: In Q3 2024, the Root Network upgraded from Substrate v0.9.27 to v1.0.0, improving speed, security, and efficiency. This update addresses previous limitations, such as difficulties in adopting new features, database migration challenges, and compatibility issues with newer runtime and client protocols. Key enhancements include the integration of the Shanghai EVM framework, which expands compatibility and ecosystem benefits. Transaction throughput has been increased by adjusting the block weight, while the block gas limit was raised from 11 million to 15 million after benchmarking, allowing for more efficient transaction handling. The upgrade also establishes streamlined processes for future updates, reducing the complexity of subsequent transitions. These improvements position The Root Network to support advanced features and scale effectively, aligning with its long-term architectural vision. Asset Register Improvements: The Asset Register, developed by Futureverse, introduced new features in Q4 2024 to improve asset interoperability and cross-chain accessibility. This system connects NFTs and SFTs across multiple blockchains, including EVM-compatible networks, addressing limitations such as high fees and slow verification. Its key features include cross-chain linking, a flexible schema system for managing asset metadata, and real-time event streaming for instant updates, enabling seamless integration and innovative applications. Futureverse also plans to decentralize the Asset Register by integrating it into the Sylo Network. This transition aims to enhance transparency, security, and community-driven governance while maintaining compatibility. It provides developers with tools to innovate more efficiently and ensures that users’ digital assets remain scalable, interoperable, and secure, supporting the growth of the open metaverse. ASM AI Protocol Enhancements: In Q3 2024, ASM introduced enhancements to its AI protocols to improve scalability and usability across its ecosystem. These updates addressed challenges like genome scaling and multichain compatibility, making the system more adaptable and user-friendly. Key advancements included the Murmur Matrix, which enables AI agents to exhibit spatial awareness and contextual memory; the Non-Fungible Intelligence (NFI) Protocol, designed to create intelligent NFTs and SFTs with embedded B.R.A.I.N.S.; the ASM Launchpad Protocol, providing tokenized licensing for developers to access ASM’s patented technologies; and ASM Void Protocol 2.0, a staking mechanism for ASTO holders to generate ASTO-Energy, claim rewards, and participate in ecosystem activities. Building on these developments, Q4 2024 saw Altered State move closer to alpha testing, introducing a generative AI tool that allows creators to produce highly detailed 3D models using intuitive prompts. These developments build on ASM’s ecosystem improvements, advancing AI-driven creativity and functionality within the open metaverse. Jen Music Platform Updates: The Jen platform, an AI-driven music creation tool within Futureverse’s ecosystem, transitioned to its beta phase after its alpha release in June 2024. The beta introduced 16 new features to enhance user experience and optimize its AI models. In November 2024, the platform launched StyleFilter™ in collaboration with Grammy-winning artist Imogen Heap, allowing users to apply distinct musical styles to their creations. These updates reflect Jen’s ongoing development and refinement of its tools. Validator Updates on The Root Network: On December 15, The Root Network raised validator commission rates on Futureverse-operated nodes from 1% to 5% to encourage external validator participation and enhance decentralization. Participants are advised to review their nominations to maximize staking rewards, align with reliable validators, and contribute to a more decentralized ecosystem. SDK and Network Enhancements: Futureverse announced updates to its authentication SDK, including a refreshed user interface, WAGMI 2.0 integration, expanded customization options, and automatic support for new OAuth features. Developers are advised to update to the latest SDK version to access these enhancements, with documentation available for guidance. Notable highlights: Questmas Event: A 12-day program distributed ROOT tokens and exclusive collectibles, driving holiday engagement. Leadership Appointment: Isabel Quinteros, formerly of TikTok, joined Jen as Senior VP to develop monetization frameworks for sustainable AI-driven music creation within Futureverse. AI-Generated Transactions on XRPL: The Jen platform has facilitated over 334,000 AI-generated transactions on the XRPL using XLS-20 NFTs for copyright registration, with 4 million+ NFTs minted since its beta launch last month. Closing Summary Futureverse achieved notable progress in Q4 2024, with strong market capitalization and ecosystem growth developments. ROOT’s market cap increased 131% QoQ to $50 million, while ASTO surged 174% QoQ to $27 million, reflecting growing interest in AI protocols. NFT sales remained stable at $1.1 million QoQ, with sales counts rising 21% QoQ to 4,700. Technological advancements included updates to the authentication SDK, improvements in cross-chain asset management through the Asset Register, and progress in the ASM ecosystem as Altered State moved closer to alpha testing. The ecosystem expanded with partnerships such as the Girin Wallet launch and the integration of the Material World Protocol in The Third Kingdom.
Source: Armita — Published: 2025-02-06T17:00:00ZMarinade Q4 2024 Brief
Key Insights Marinade’s Total Value Locked (TVL) increased by 35.6% QoQ to $1.7 billion. Native staking now comprises 36.2% of Marinade's TVL. Revenue reached $3.05 million in Q4’24, representing a 249.3% QoQ increase in USD and a 165.2% increase in SOL. 98.7% of Marinade’s revenue was generated through the Stake Auction Marketplace (SAM). mSOL APY increased by 31.1% QoQ to 9.9%. mSOL’s APY was supported by Solana’s rising transaction volumes and network activity. Three governance proposals (MIP1, MIP2, and MIP3) were passed. These proposals were designed to improve validator participation, staker protection, and MNDE utility. Marinade’s native and liquid staking products accounted for 2.2% of all staked SOL. Marinade’s native and liquid staking SOL TVL increased by 23.9% and 4.5%, respectively, QoQ. Primer Marinade (MNDE) is an automated staking protocol on Solana that provides liquid and native staking solutions. Marinade was founded during the March 2021 Solana x Serum Hackathon and launched on mainnet on August 2, 2021. Marinade’s governance token MNDE was released a few months later, with a retroactive airdrop for Marinade SOL (mSOL) holders. Marinade has not raised venture capital funding or conducted public token sales. Instead, Marinade’s native token MNDE has mainly been distributed via various campaigns to reward users and contributors. Beyond incentives, MNDE is used for governance on Realms. Previously, Marinade delegates staked SOL to validators based on its algorithmic delegation strategy (60%) and MNDE and mSOL directed stake (20% each), where tokenholders can vote for specific validators or the algorithmic set. After Q2, the delegation strategy was updated with a Stake Action Marketplace where validators bid on stakers SOL deposits. For both the algorithmic strategy and directed stake, validators need to meet specific criteria for eligibility, notably a maximum 7% commission. In April 2024, Marinade launched Protected Staking Rewards (PSR), which also requires validators to put up a SOL bond to be eligible for stake on Marinade. PSR enforces an onchain service-level agreement protecting stakers from reduced rewards. Website / X (Twitter) / Discord Key Metrics Performance Analysis TVL Marinade’s TVL increased by 35.6% QoQ to $1.7 billion in Q3. When denominated in SOL, TVL increased by 59.9% to 8.9 million. Total Marinade TVL, typically correlated to Solana TVL, increased by 10.7% QoQ to $8.5 billion. Marinade operates two separate staking products: liquid and native staking. Marinade’s liquid staking allows users to stake their SOL for mSOL, which provides all the benefits of native staking yield and allows users to participate in DeFi with their receipt token. In Q4’24, Marinade’s liquid-staked SOL TVL rose by 4.5% QoQ to 5.6 million SOL. Marinade native staking launched in Q3’23, allowing users to stake SOL directly without losing custody of their keys. This strategy may appeal more to institutional investors, who tend to avoid the smart contract risks associated with liquid staking and the concentration risks tied to relying on a single validator or custodian solution. Native staking comprises 36.2% of Marinade’s total TVL. Marinade Native’s TVL rose 23.9% QoQ to 3.2 million SOL in Q4’24. Market Cap and Fees Copilot Insights: How much of Marinade's revenue comes from the Stake Auction Marketplace? Copilot Insights: How much revenue did Marinade generate in Q4 2024? In Q4’24, Marinade’s market cap increased 27.4% QoQ to $46.3 million. MNDE has a maximum supply of 1 billion tokens, of which 386 million are circulating. 108.0 million MNDE tokens were unlocked from the DAO treasury in Q4’24. Marinade’s Q4’24 total revenue reached $3.05 million, a 249.3% increase QoQ and a 774.2% increase YoY. The rise in revenue can be attributed to two key factors: the rise in SOL’s price and the establishment of Marinade’s Stake Auction Marketplace (SAM). In Q4’24, SOL’s median price rose from Q3’s median price of $143.85 to $194.48. Furthermore, Marinade’s SAM, launched on Aug. 14, 2024, earned 14,835.11 SOL in Q4’24, accounting for 98.7% of all revenue generated over the quarter. Marinade’s SAM is an auction marketplace where validators compete in open bidding for stakers’ delegated SOL. Each validator in the Marinade delegation set will only pay as much as the least-yielding validator in the delegation set. Validators with higher amounts of stake will still have the potential to earn greater rewards in addition to perks like priority fees. Marinade automates the distribution of SOL to the highest-performing validators to achieve optimal returns for stakers. Marinade generates revenue from the SAM by charging a variable performance fee on validator bids. This performance fee is dynamically adjusted to target enhanced yields greater than 0% commission validators can provide. Marinade also earns revenue from unstaking fees ranging from 0.1-9% based on the total liquidity available in the mSOL/SOL LP and the unstaked amount. In Q4’24, Marinade’s unstaking fees only accounted for 1.35% of its total revenue. Before the launch of the SAM, Marinade also collected a 6% staking fee on Marinade Liquid rewards. Marinade’s staking fee was removed on Aug. 20, 2025. Validators and APY Copilot Insights: How much has mSOL's APY grown? mSOL APY increased by 31.1% QoQ to 9.9%. Concurrently, network activity on Solana increased across several metrics in Q4’24, including average daily active addresses, average daily transaction fees, and TVL. Validators earn staking rewards based on network performance and activity. When Solana experiences higher transaction volumes, validators process more transactions, which increases the amount of SOL distributed as rewards. The mSOL APY figure is calculated based on mSOL’s “true price,” i.e., SOL in Marinade staking pool / mSOL minted. Native staking through Marinade typically yields a slightly higher APY because native stakers aren’t paying the same fees as with mSOL. However, with native staking, SOL is locked up and cannot be used in DeFi applications until it is unstaked and goes through the cooldown period. As of the end of Q4’24, Marinade delegated SOL to 179 validators, a 3.2% QoQ decrease. However, the number of validators Marinade delegates to varies daily. Q3’s decrease in validators corresponds with the launch of Phase 2 of Marinade’s SAM, which began the automatic redistribution of stake among the top-performing validators. Additional information on each validator can be found on Marinade’s network page. Protected Staking Rewards (PSR) was launched in April 2024, with over 400 validators participating from the outset. PSR enforces an onchain service-level agreement protecting stakers from reduced rewards for validator performance issues or commission rugs. PSR requires validators to put up a bond to be eligible for Marinade stake. This allows Marinade to stake to more validators without sacrificing APY to stakers. Governance Updates Copilot Insights: What were Marinade's governance updates in 2024? Marinade’s governance framework remained central to protocol development in Q4’24, with the community passing three Marinade Improvement Proposals (MIPs): MIP 1: Relaxation of SAM Constraints MIP 2: Adjustment of Protected Staking Rewards (PSR) Coverage MIP 3: Further Adjustment of PSR Coverage These proposals focused on increasing validator participation, enhancing staker protection, and improving competitiveness across the ecosystem. MIP 1: Relaxation of SAM Constraints On Oct. 21, 2024, Marinade proposed a relaxation of SAM constraints. The proposal was designed to enhance SAM’s accessibility and competitiveness by increasing Solana’s administrative services organization (ASO) concentration limit from 20% to 30% and removing Marinade-specific ASO and country-based concentration constraints. These adjustments allow more validators to participate in Marinade’s SAM, which increases competition. MIP 1 passed with overwhelming support, with 99.9% of the vote in favor. MIP 2: Adjustment of Protected Staking Rewards (PSR) Coverage On Oct. 21, 2024, Marinade created a second proposal designed to adjust the PSR mechanism. The adjustment aimed to incentivize validators to maintain high uptime while improving Marinade’s financial sustainability by making validators responsible for covering 100% of rewards lost due to downtime when their uptime falls between 50% and 99%. While Marinade would only cover the rewards lost in the lower 0% to 50% uptime range. By reducing the strain on Marinade’s treasury, the protocol can reallocate resources toward development, security, and user experience enhancements. MIP 2 passed with 82.8% of the vote in favor. MIP 3: Enhancing MNDE Utility by Integrating with the Stake Auction Marketplace On Oct. 22, 2024, Marinade introduced a proposal to integrate the MNDE-directed stake mechanism with Marinade’s SAM. Marinade’s directed stake product enabled MNDE holders to choose the validator they wanted to support. However, MIP 3 removes the standalone MNDE-directed stake system and implements a system where a proportion of MNDE tokens directed towards a validator increases their maximum potential stake from the SAM, which will distribute 100% of Marinade’s TVL. By consolidating stake distribution within the SAM, MIP 3 simplifies the staking process, eliminates inefficiencies, and gives MNDE holders direct influence over validator stake caps. MIP 3 passed with 75.9% of the vote in favor. mSOL in DeFi Copilot Insights: How can I earn additional yield on my mSOL? mSOL deposited in DeFi protocols decreased by 6.0% QoQ to 1.15 million, potentially driven by updates and changes within each protocol: Kamino maintained its majority share of mSOL in DeFi for the fourth quarter in a row. Kamino leads mSOL TVL on Solana. Kamino’s mSOL TVL grew 9.5% QoQ to 396,700 mSOL. Drift, the 9th largest protocol on Solana by TVL, ended Q4’24 with 143,200 mSOL, a 76.9% increase QoQ. Comparatively, JitoSOL fell 6% QoQ to 619,000 tokens, while DSOL (Drift Staked SOL) increased 152% QoQ to 391,900 tokens. Save, formerly Solend, initially captured the majority share of mSOL in DeFi, but Kamino surpassed it in Q1’24. In Q4’24, Solend’s mSOL supply increased by 9.3% QoQ to 385,400 mSOL. Solayer, a restaking network on Solana, launched at the end of May 2024. Solayer’s mSOL supply fell 79.2% QoQ to 55,600 mSOL in Q4’24. Competitive Landscape Copilot Insights: What protocols are Marinade's largest competitors? Solana’s liquid staking rate (the percent of liquid-staked SOL) increased by 7.9% QoQ to 11.2%. With 65% of eligible SOL supply staked, an increase in the liquid staking rate is necessary to maintain an ecosystem focused on yield-bearing SOL. The top competitors for Marinade liquid staking include Jito, Sanctum, Binance staked SOL, and Jupiter. Marinade’s liquid staking market share fell 22.4% QoQ to 13%, with Jito’s market share remaining stable at 42%. However, including Marinade Native staking, which contributed 3.16 million staked SOL to Marinade’s TVL in Q4’24, Marinade’s total liquid plus native staking market share reached 18.9%. Jito’s jitoSOL remained Solana’s LST leader. The JitoSOL supply grew 6.28% QoQ to nearly 14.7 million SOL, giving it a 34% market share. In Q4’24, Jito expanded its restaking offering by launching Phase 1 and expanding the deposit cap to $50m. Sanctum LSTs ended Q4’24 with nearly 6.1 million SOL, a 24.8% increase QoQ. The Sanctum Infinity Pool, a multi-LST liquidity pool containing 82 LSTs at the end of Q4’24, saw a 29.9% decrease QoQ with 879,000 SOL in TVL. The pool prices LSTs by its “floor price” relative to SOL, allowing any LST in the pool to tap into any other’s liquidity. For example, if a user wants to sell xSOL for USDC, but no xSOL/USDC pool exists, xSOL could be swapped to ySOL and sold to USDC using the ySOL/USDC pool. The top Sanctum LST is Jupiter’s JupSOL, which ended Q4’24 with a supply of 3.8 million SOL, an 18.7% increase QoQ. Other popular Sanctum LSTs include Helius’ hSOL and Drift’s dSOL. While Sanctum benefits Marinade by increasing liquidity for mSOL, it may also disadvantage Marinade as one of the market leaders. Sanctum products lower the barriers to launching LSTs, enabling experimentation and expanding the design space of LST functionality. However, Marinade’s PSR and SAM features help provide a defensible moat against new entrants. These features help protect stakers from downtime and use the open market to determine competitive yields. This enabled Marinade’s yield to reach as high as 11.4% APY in Q4’24. Marinade Native Staking’s top competitors include Galaxy, Binance, and Coinbase, each accounting for over 11.2 million staked SOL. While these three organizations have a higher distribution and access to idle Solana capital, they do not provide non-custodial staking or diversification across multiple validators. Helius is also a leading native staking competitor, accounting for over 12.9 million staked SOL. Ultimately, Marinade’s competitive edge lies in its prioritization of security without sacrificing yield through PSM and its implementation of the SAM to deliver optimal yields determined by the open market. Closing Summary Marinade’s Q4’24 performance was marked by strong growth and governance-driven advancements. Total Value Locked (TVL) increased 35.6% QoQ to $1.7 billion, while mSOL APY climbed to 9.9% amid increased Solana network activity. Marinade’s revenue also grew significantly during the quarter, accruing 15,000 SOL, a 165.2% QoQ. Revenue growth was driven by the Stake Auction Marketplace (SAM), which accounted for 98.65% of total revenue after the protocol shifted away from staking fees in August. By the end of the quarter, Marinade’s liquid and native staking products represented 2.2% of all staked SOL. This growth reflects the success of Marinade’s SAM in providing optimal yields for users, competitively positioning Marinade as a leader in the Solana ecosystem. Q4’s key developments were shaped by governance proposals aimed at strengthening Marinade’s staking ecosystem. MIP 1 relaxed the SAM constraints to improve validator accessibility and competition. MIP 2 restructured Protected Staking Rewards (PSR) to balance downtime-related losses more equitably between validators and Marinade, reducing strain on the protocol’s treasury. MIP 3 integrated MNDE Directed Stake with SAM, simplifying stake distribution and enhancing MNDE utility by allowing token holders to influence validator stake caps. These initiatives improved validator engagement, increased staker protection, and positioned Marinade to adapt to growing competition in Solana’s liquid staking market.
Source: Hayden Booms — Published: 2025-02-06T14:00:00ZState of GEODNET Q4 2024
Key Insights At the end of 2024, GEODNET had over 12,000 active Satellite Miners worldwide, reflecting a 219% increase from the previous year. This positioned GEODNET as the largest RTK network in the world, surpassing centralized competitors such as Trimble. GEODNET's infrastructure spans more than 140 countries and 4,000 cities. The highest concentration of miners is in the United States and Europe, with significant presence in South America, Australia, and India. In Q4 2024, GEOD tokens burned reached an all-time high, increasing 54% YoY in GEOD terms and 463% in USD terms, reflecting strong demand and revenue growth. In December, GEODNET executed one of its largest token unlocks, releasing 32.46 million GEOD ($7.98 million). Despite the unlock, GEOD’s price remained unaffected, rallying ahead of the event and continuing to reach all-time highs afterward. GEODNET raised a Strategic Funding Round for $2 million from Animoca Brands and ParaFi Capital. Primer GEODNET (Global Earth Observation Decentralized Network) is a Decentralized Physical Infrastructure Network (DePIN) project delivering high-precision geospatial data and positioning through a decentralized Real-Time Kinematics (RTK) network. The network operates on a community-driven model where individual operators purchase and install RTK Base Stations, also known as Satellite Miners, on their property. These base stations receive GNSS signals and provide real-time correction data with 1 cm accuracy, which is then transmitted to GEODNET's cloud platform. The GEOD token is the native utility token of the GEODNET network, used to reward contributors and facilitate transactions within the ecosystem. GEOD tokens are primarily used to reward users who have installed Satellite Miners and to pay for RTK data services. Additionally, GEOD tokens enable participation in project governance. In just two years, GEODNET has expanded to over 10,000 RTK Base Stations globally, making it the largest RTK network in the world and surpassing centralized competitors like Trimble. This rapid growth has resulted in $2 million in annualized revenue. Key Metrics Analysis At the end of 2024, GEODNET's GEOD circulating market capitalization reached $62 million, marking a 59% quarter-over-quarter (QoQ) increase and a 524% year-over-year (YoY) growth, nearing its all-time high. The fully diluted valuation of GEOD stood at $245 million, reflecting the token's maximum supply of 1 billion, with 40% of the total supply unlocked by the end of 2024. For the first half of 2025, GEOD tokens are scheduled to unlock at a rate of 21 million tokens per month. GEOD ranked as the 750th largest crypto asset by market cap, but ranked among the top physical DePINs. The GEODNET network operates on a decentralized model where individual participants deploy RTK Base Stations, known as Satellite Miners, on their property. These base stations receive GNSS signals and generate real-time correction data with 1 cm accuracy, which is transmitted to GEODNET's cloud platform. In exchange, operators receive daily GEOD token rewards. At the end of 2024, GEODNET had over 12,000 active Satellite Miners worldwide, reflecting a 219% increase from the previous year. This positioned GEODNET as the largest RTK network in the world, surpassing centralized competitors such as Trimble. Source GEODNET's infrastructure spans more than 140 countries and 4,000 cities. The highest concentration of miners is in the United States and Europe, with significant presence in South America, Australia, and India. The GEODNET Foundation monetizes correction data by selling it through multiple channels, with 80% of the revenue allocated to buying and burning GEOD tokens. GEOD tokens also serve as an indirect payment mechanism within the network. While most RTK data transactions are conducted in fiat currency, 80% of these payments are used to repurchase and burn GEOD tokens. In Q4 2024, the volume of GEOD tokens burned reached an all-time high, increasing 54% YoY in GEOD terms and 463% in USD terms, reflecting strong demand and revenue growth. The total supply of GEOD tokens is capped at 1 billion, with no plans for additional issuance. Mining allocations are distributed daily to base station operators according to a fixed schedule. Allocations for the team, investors, and ecosystem follow a multi-year vesting plan. A detailed breakdown is available in the GEODNET Deep Dive Report. On December 28, 2024, GEODNET executed one of its largest token unlocks, releasing 32.46 million GEOD ($7.98 million). Despite the unlock, GEOD’s price remained unaffected, rallying ahead of the event and continuing to reach all-time highs afterward. Ecosystem and Partnerships Overview Geodnet is expanding its ecosystem through strategic partnerships across industries, enhancing RTK capabilities and extending reach. Recent partnerships and announcements over the past few quarters include: Boson Motors Partnership: At World Ag Expo 2024, Boson Motors showcased an autonomous electric truck using GEODNET'S RTK service, highlighting precise GPS navigation for agriculture. Wingbits Collaboration: Geodnet partnered with Wingbits, a decentralized flight-tracking network, to develop professional-grade ADS-B and RemoteID tracking nodes. Wingbits' network currently has 2,000 ADS-B stations, with plans to grow to 10,000 by 2025. GEODNET's RTK service enhances the accuracy of Wingbits' nodes, improving air traffic monitoring and drone operations. Propeller Integration: Propeller, a worksite mapping company, integrated GEODNET'S GNSS stations to enhance survey-grade mapping for industries like construction and mining. Using data from GEODNET's 9,000 GNSS reference stations, Propeller delivers high-accuracy maps to support global worksites, improving decision-making. Agri Automation Partnership: In October 2024, Agri Automation partnered with Geodnet to deploy RTK services in rural Australia and New Zealand, enabling reliable RTK coverage for autonomous farming solutions and boosting productivity. Quectel Wireless Solutions Collaboration: Quectel Wireless Solutions is leveraging GEODNET's GNSS modules to target a wide range of IoT applications, including scooters and robotic mowers. ByNav Integration: ByNav has integrated GEODNET'S RTK services into its Automotive Advanced Driver Assistance Systems (ADAS) solutions. This collaboration enhances precision and safety in autonomous driving applications. CES 2025 Announcements: At CES 2025, GEODNET highlighted its expanding industry presence with two new partnerships—Septentrio and Bad Elf—further integrating its RTK network into high-precision GNSS solutions, reinforcing its role in both enterprise and consumer applications. Additional Developments GEODNET announced the multichain expansion of its GEOD token to Solana using the Wormhole NTT framework. GEODNET raised a Strategic Funding Round for $2 million from Anamoca Brands and ParaFi Capital. GEODNET introduced GEO-PULSE, a $149 GPS receiver that leverages its RTK network to provide centimeter-level accuracy for navigation, improving driving directions, rideshare efficiency, and urban navigation, while also offering a built-in GPS repeater to enhance location accuracy for all devices in a vehicle. GEODNET was actively present at several key industry events in Q4 2024, including Token 2049, INTERGEO, Messari Mainnet, Permissionless, and more. Closing Summary GEODNET experienced substantial growth in 2024, solidifying its position as the largest RTK network globally. With over 12,000 active Satellite Miners across 140 countries and 4,000 cities, the network expanded by 219% YoY, surpassing centralized competitors like Trimble. This growth was further reinforced by strong demand activity, as the volume of GEOD tokens burned in Q4 2024 reached record highs, increasing 54% YoY in GEOD terms and 463% in USD terms. December 2024 marked one of GEODNET’s largest token unlocks, releasing 32.46 million GEOD ($7.98 million). Despite the event, GEOD’s price remained unaffected, continuing its upward trajectory and reaching all-time highs. Institutional interest in the network also grew, with GEODNET securing a strategic funding round from Animoca Brands and ParaFi Capital. Looking ahead, GEODNET is positioned to further expand its network and reinforce its status as a leading DePIN project. As adoption increases, GEODNET is on track to become one of the top physical DePINs.
Source: Nicholas Garcia — Published: 2025-02-05T16:00:00ZState of IoTeX Q4 2024
Key Insights Following the launch of IoTeX 2.0, average daily transactions on the IoTeX Network surged 1,267% QoQ to 384,300, with peak throughput reaching 62 tps in Q4 2024. Total fees accrued on the IoTeX Network grew by 205% QoQ to $448,500, driven by a 1,600% increase in gas fees and a 690% rise in DEX fees, primarily from activity on Mimo. IoTeX advanced the integration of AI and DePIN by introducing BinoAI, an autonomous agent built on ai16z’s ELIZA framework. IoTeX announced a partnership with Eliza Labs to drive the creation of DePIN-AI agents to perceive and act in physical environments through DePIN data. IoTeX released Quicksilver, a middle-layer framework to connect DePIN data to AI agents, and ioID, a universal onchain identity solution for smart devices that bridges the physical and digital worlds. IoTeX V2.1 launched in December, introducing Cancun EVM compatibility, ensuring enhanced functionality and Ethereum interoperability. Primer IoTeX (IOTX) is a modular infrastructure platform that supports developers of decentralized physical infrastructure networks (DePIN). By integrating advanced AI capabilities, IoTeX bridges the physical and digital worlds, enabling smart devices and decentralized applications (dapps) to interact with blockchains. The IoTeX network combines its EVM-compatible Layer-1 (L1) blockchain, offchain compute mid-layer, and open hardware to connect real-world data from devices, machines, and sensors with onchain ecosystems. The IoTeX L1 utilizes a Randomized Delegated Proof-of-Stake (Roll-DPoS) consensus mechanism. Anyone can stake the network’s native token (IOTX) and vote for one or more community-elected delegates who manage consensus on behalf of the IoTeX Network. IoTeX’s latest product release, Quicksilver, introduces a framework for integrating DePINs with AI agents. Quicksilver enables real-time data processing, adaptive responses, and AI-driven interactions with the physical world. DePINs function as “sensory organs” for AI agents, leveraging decentralized networks of IoT devices to collect and share real-world data. These devices provide continuous data streams verified using ZK proofs, allowing AI agents to sense, interpret, and respond to their environments. The first iteration of Quicksilver has been released as an open-source project, with the official testnet launch expected in Q1 2025. At the core of Quicksilver is ioID, a decentralized identity (DID) protocol that transforms hardware devices—such as smart devices and sensors—into onchain entities with verifiable identities. The ioID protocol enables trust, interoperability, and secure agent-to-agent communications. It also plays a key role in orchestrating blockchain-based AI agent swarms, where multiple specialized agents collaborate to solve complex problems. Quicksilver’s modular design enhances scalability and verifiability. The framework supports applications like BinoAI, a DePIN-oriented AI agent built on Quicksilver, which connects to various DePIN projects for use cases ranging from smart cities to precision agriculture. For a full primer on IoTeX, refer to our Initiation of Coverage report. Website / X (Twitter) / Telegram Key Metrics Network Overview The IoTeX Network connects supply and demand: Supply: IoTeX L1 provides DePIN-focused blockspace and an ecosystem to DePIN projects and other dapps. IoTeX also supports the entire lifecycle of projects by providing infrastructure, public goods, and governance tools through DePIN Infrastructure Modules (DIMs). This is offered in a modular, end-to-end tech stack that connects real-world data to the blockchain world. Demand: Consumers of blockspace on IoTeX L1 and DePIN-focused middleware/tooling. These are primarily DePIN projects but also projects in the DeFi and GameFi sectors. Usage Demand for the IoTeX L1 blockspace comes from more than 120 dapps in need of data streaming and offchain compute capabilities. The real-world data is sourced primarily from smart devices, machines, and sensors. Average daily active wallets on the IoTeX Network surged 1,081% QoQ from 957 to 11,301 in Q4. The recent increase may be attributed to the launch of the ioID infrastructure protocol on November 20. As part of the IoTeX 2.0 launch, the ioID protocol aims to manage the decentralized identity lifecycle in DePIN. The ioID protocol is IoTeX’s onchain identity solution to issue Decentralized Identities (DID) and Verifiable Credentials (VC) to physical hardware. In simple terms, ioID turns hardware devices (e.g., smart devices, machines, and sensors) into onchain entities with a verifiable identity. The ioID protocol is also used within the Quicksilver framework to register AI agents with an AI agent registry on the blockchain, unlocking peer-to-peer agent communication as well as decentralized management of agent swarms by DePIN projects As of the end of Q4 2024, 7,500 ioID identities were registered and verified onchain by 1,500 device owners. Miners and community members can reserve ioIDs to bootstrap DePIN networks. Following the launch of IoTeX 2.0, the onboarding of new ioIDs, and the start of the Get Goated Season 2 incentive campaign in October, activity on the IoTeX Network surged 1,267% QoQ from 28,100 to 384,300 in terms of the average daily transactions, with an average of 62 peak transactions per second throughout Q4. Staking Overview Staking represents a core component of decentralized governance on the IoTeX Network. Holders of the native IoTeX token — IOTX — deposit the token to support network operations, consensus, and governance. If token holders stake their IOTX tokens, they can vote for delegates to manage consensus on their behalf. Tokenholders earn IOTX rewards in return for staking. Simultaneously, IoTeX 2.0 has inflationary staking rewards to boost the amount of IOTX staked and increase network security. The community decides the inflation rate, aiming for mild inflation that offers competitive staking rewards APRs. Gas fees paid in IOTX are burned, correlating it to the amount of network activity. In addition, the ioID protocol requires IOTX tokens to be burned to create new onchain identities for devices, with this burn rate being dynamic based on the total number of registered devices. Other actions in the ioID protocol require burning IOTX, such as obtaining verifiable credentials (VCs) for decentralized identification (DIDs) and linking device identities to the IoTeX L1 and other decentralized infrastructure modules (DIMs). As of December 31, 2024, the IoTeX Network was secured by 114 active delegates, with $137 million (3.6 billion IOTX) staked—a 20% QoQ decrease. Staking participation averaged 38% in Q4 2024, down from its all-time high in Q3. Financial Overview Fees Total fees accrued by the protocol capture the demand side of the IoTeX Network: Gas fees: paid in IOTX by anyone initiating a transaction on the IoTeX Network, similar to Ethereum's transaction fee structure. Activation fees: paid upon activating an ioID device. DEX fees: paid in IOTX when using the Mimo decentralized exchange (DEX) as part of the DePIN Liquidity Hub program. Total fees accrued on the IoTeX Network increased by 205% QoQ, reaching $448,500 in Q4 2024. This growth was primarily driven by a substantial rise in gas fees, which grew 1,600% QoQ from $9,000 to $153,000, and DEX fees, which increased by 690% QoQ from $18,000 to $143,000, largely due to activity on Mimo. ioID device activation fees experienced more moderate growth than these revenue streams, rising 28% QoQ from $120,000 to $153,000. Rewards IoTeX leverages token incentives to deploy and maintain a community-contributed infrastructure network. Rewards are paid to validators on the IoTeX network from new token issuance. In Q4 2024, rewards to IOTX stakers and delegates increased by 4% QoQ to $2.4 million. In IOTX terms, rewards decreased 6% QoQ from 60.6 million IOTX in Q3 to 57.2 million IOTX in Q4. Ecosystem Overview The IoTeX ecosystem currently has 251 projects, including 66 DePIN projects. The number of DePINscan projects increased by 5% QoQ, from 281 to 295. The number of devices using DePINscan increased by 8% QoQ, from 18.1 million to 19.6 million. Messari’s State of DePIN 2024 sector report indicates that IoTeX is one of the most mature DePIN L1 ecosystems, leading Q4 transaction activity among dedicated L1s-for-DePIN, which are carving out their own native onchain ecosystems. DePIN projects building on IoTeX utilize DePIN Infrastructure Modules (DIMs) such as ioID, W3bstream, Quicksilver, or choose the IoTeX L1 for token launches. DePIN use cases include connected smart vehicles, geo-mapping, energy data tracking, health platforms, and proof-of-presence and proof-of-humanity apps. Besides DePIN, use cases on the IoTeX ecosystem include AI, DeFi, GameFi, and NFTs. Partnerships and Integrations IoTeX collaborated with numerous dapps, exchanges, and crypto entities during Q4 2024. Below is a summary of the partnerships and integrations established during the quarter: On October 2, IoTeX partnered with Nubila, a data oracle specializing in ESG (Environmental, Social, and Governance) data for the DePIN ecosystem. Nubila aims to create a network of advanced weather stations to capture critical environmental data. On October 14, IoTeX partnered with Streamr, a decentralized data streaming network that provides censorship-resistant messaging, node operation, and tamper-proof encrypted data. This integration combines Streamr’s real-time data protocol with IoTeX’s DePIN infrastructure to enable faster and smarter data flow in DePIN applications. On October 16, IoTeX partnered with Starpower, a decentralized energy network startup focused on scaling Distributed Energy Resources (DERs) using proprietary hardware and software solutions like the Starplug smart plug. Starpower is integrating IoTeX’s ioID to enhance DePIN verification. On October 16, IoTeX partnered with Avalon Labs, a company focused on integrating centralized and decentralized finance (CeDeFi) services. Avalon Labs offers products such as a Bitcoin-backed stablecoin, onchain lending platforms, and yield-generating savings accounts. On October 19, IoTeX partnered with Apro Oracle, a decentralized oracle network providing secure and accurate data services tailored for Bitcoin projects. This partnership enhances smart contract capabilities and enables broader application scenarios within the IoTeX ecosystem. On November 3, IoTeX partnered with DePIN Institute to integrate users into decentralized infrastructure networks through familiar devices such as smart home systems, wearable devices, and augmented reality equipment. On November 5, IoTeX partnered with the OKX Wallet, enabling 50 million global users to trade IoTeX assets natively within the OKX DEX. On November 6, IoTeX partnered with Orbiter Finance, a ZK-powered Ethereum L2 network backed by OKX Ventures. The partnership aims to enhance security and scalability within the Ethereum ecosystem. On November 15, IoTeX partnered with BitBot, a non-custodial Telegram trading bot that leverages AI to provide advanced trading tools and market insights, making these accessible to retail investors. On November 21, IoTeX partnered with Geodnet to integrate its Geo-Pulse device with IoTeX’s ioID for onchain identity and W3bstream for ZK proofs. Geo-Pulse, designed for installation on vehicle dashboards, delivers lane-level positioning with over 10x the accuracy of standard GPS or smartphone systems. Drivers can earn GEOD and IOTX rewards by contributing verified coverage data through the device. On December 5, IoTeX partnered with Jasmy, a blockchain-based platform, creating a decentralized Internet of Things (IoT) ecosystem where users control access to their data via the Personal Data Locker and share it selectively for JASMY rewards. On December 5, IoTeX partnered with the Blockchain Association, a leading U.S. crypto trade association based in Washington D.C., focused on advancing supportive policies and regulations for cryptocurrency. On December 19, Inferix secured $2.6 million from DePIN X Capital, which is backed by IoTeX, to develop a Decentralized GPU Network for AI training and visual computing. On December 27, Roam launched its Discovery Ecosystem, a platform supporting early-stage innovative projects. IoTeX is a key partner, alongside Huma Finance and Mind Network, contributing to initiatives spanning L1, PayFi, and AI sectors. Qualitative Analysis & Key Developments DePIN x AI The convergence of AI and DePIN has the potential to redefine how computational resources are distributed, network participation is incentivized, and infrastructure ecosystems are democratized. Their relationship will likely be symbiotic, as DePIN networks contribute verifiable, crowdsourced data that can be leveraged to train AI models. At the same time, AI can optimize the operations of DePIN devices by automating resource allocation, predicting network demands, and increasing revenue potential for device owners. IoTeX, focusing on verifiable DePIN infrastructure, is well-positioned to serve as a key enabler of this emerging intersection between AI and DePIN. Eliza x BinoAI In Q4 2024, IoTeX made notable progress in integrating AI with its ecosystem by introducing BinoAI, an autonomous AI agent launched on December 19. Built on ai16z’s open-source ELIZA framework and deployed on the IoTeX network, BinoAI specializes in the DePIN ecosystem. Its primary role is to autonomously share knowledge and insights, from simplifying complex DePIN concepts to highlighting new projects and achievements in the space. BinoAI aims to foster a more informed and connected DePIN community by engaging users through educational content and social interactions. Additionally, BinoAI leverages IoTeX L1’s blockchain functionality to securely access and interact with onchain data, enhancing its ability to deliver relevant and actionable insights. The introduction of BinoAI represents the first step toward the broader application of AI agents in the DePIN ecosystem. Future development could see the emergence of industry-specific AI agents tailored to specialized DePIN applications. For example, mobility-focused agents could optimize decentralized logistics and manage autonomous vehicles, while energy-specific agents might streamline renewable energy grids and enable efficient energy trading systems. Similarly, agents designed for wearables could provide personalized health insights and biometric security, and those tailored for smart homes could manage decentralized devices, security systems, and energy consumption. These AI agents could simultaneously enhance user engagement and improve the interaction experience with DePIN networks. To further advance this vision, IoTeX, and Eliza Labs, the creators of ElizaOS and ai16z, announced a strategic partnership focused on empowering autonomous AI agents with the ability to perceive and interact with the physical world through DePIN networks. This collaboration seeks to bridge the gap between digital intelligence and real-world sensory data, accelerating progress toward AI agents that can interact with and learn from their physical environments. By integrating data from IoTeX-powered DePIN networks, such as Nubila (weather data), Geodnet (geospatial positioning), and Pebble Tracker (GPS, motion, and temperature data), AI agents will be able to harness real-time data streams and act autonomously. Key areas of collaboration between IoTeX and Eliza Labs include the integration of a DePIN plugin for ElizaOS. This plugin will be a critical layer, allowing Eliza agents to retrieve and process real-world data from IoTeX’s DePIN networks. With access to this data, AI agents can gain contextual awareness, enabling them to develop predictive capabilities and adaptive behaviors based on historical and real-time inputs. These enhancements will improve decision-making and expand the applicability of AI agents in real-world scenarios, from robotics and smart devices to urban management in smart cities. The partnership also empowers developers by providing access to IoTeX’s modular DePIN tools through Eliza Labs’ AI Agent Dev School. This initiative includes workshops, tutorials, and technical guides designed to help developers integrate DePIN capabilities into AI workflows, further fostering innovation in the ecosystem. The collaboration between IoTeX and Eliza Labs represents a significant step in integrating AI and DePIN, with implications that could reshape the future of autonomous agents. The development and application of AI in this context will remain a key area to watch throughout 2025 as IoTeX advances its role at the forefront of this intersection. Quicksilver IoTeX also announced the launch of a new DIM, Quicksilver, scheduled for an official Testnet release expected by Q1 2025. Quicksilver is a sentient AI framework for bridging DePIN and AI Agents. Quicksilver empowers developers to build AI agents capable of sensing, understanding, and acting within the physical world. By leveraging DePINs as a sensory layer, these agents can collect and process data from decentralized physical infrastructure, such as weather stations, energy grids, or geospatial networks. With this real-world data, agents integrate advanced reasoning capabilities from large language models (LLMs) to perform context-aware actions and automate multi-step workflows while maintaining state and context. The framework’s modularity enables AI agents to interact with multiple DePIN projects simultaneously, drawing from diverse data sources to enhance adaptability and utility. Quicksilver is powered by three key modules and three supporting plugins/tools. The Identity Module provides AI agents with onchain and offchain identities, enabling secure and trust-based interactions with network participants, including smart devices, services, or other agents. Onchain identities simplify the management of crypto assets and ownership, while offchain identities support secure agent-to-x communications. The Blockchain Wallet Module enables AI agents to engage in the agent economy by managing transactions onchain, leveraging account abstraction to simplify Web2-based authentication for managing crypto assets. The Verifiable Computing Module ensures the trustworthiness of program execution in AI agents, guaranteeing reliable responses when processing queries or interacting with other entities. In addition to these modules, Quicksilver includes three plugins/tools to extend the capabilities of AI agents. The DePIN Adapter Plugin facilitates connections to various DePIN projects, enabling agents to access and interact with decentralized physical infrastructure. The Blockchain Plugin equips agents with the ability to query onchain data, enhancing decision-making based on real-time blockchain activity. Finally, the Verifiable Computing Plugin allows agents to access external verifiable computing services via API calls, ensuring data integrity and reliability in their operations. The convergence of DePINs and AI agents heralds a new era of synergy between artificial intelligence and the physical world. By combining decentralized infrastructure with intelligent automation, Quicksilver has the potential to push the boundaries of technological innovation while enhancing real-world applications, from urban living to industrial efficiency. As DePINs continue to expand, Quicksilver paves the way for AI agents that are more capable and deeply attuned to the complexities of our physical reality. ioID Launch Copilot Insights: What is ioID? On November 20, 2024, IoTeX announced the release of ioID, a universal onchain identity solution for smart devices. Designed to bridge the physical and digital worlds, ioID provides decentralized identity and ownership mechanisms for devices within the IoTeX ecosystem. The ioID architecture combines several components, including the ioID SDK, decentralized identifiers (DIDs), the IoTeX Hub, ioID NFTs, and smart contracts deployed on IoTeX’s L1. These elements form a framework for managing device identities, securing data, and enabling verifiable device interactions. At the core of ioID’s architecture is its DID system. When a device is powered on, a DID is created along with a corresponding DID document. The private key for the DID is securely stored on the device, enabling it to sign and verify any data and activities produced by the device. The IoTeX Hub, a web portal, facilitates user registration by binding a device’s DID to its ioID NFT, creating an onchain identity. Device owners must deposit IOTX to cover fees for smart contract interactions required to activate the ioID. Once activated, the ioID NFT is minted and represents the onchain ownership of the device. The NFT enables its holder to manage the device’s data, perform onchain actions, and collect rewards tied to the device’s activity. The ioID solution is underpinned by a suite of smart contracts on the IoTeX blockchain, which collectively manage the decentralized identity lifecycle. These include: ioID Registry for onchain device registration and identity resolution. Project Registry for managing DePIN projects. ioID NFT for issuing unique device identities. ioID Store for activating and managing identities. These smart contracts ensure that ioIDs are verifiable, programmable, composable, and tamper-proof, aligning with IoTeX’s broader goal of creating a chain-agnostic identity framework. ioIDs are also equipped with their own smart contract wallets and private keys, allowing them to sign data and verify real-world activities. They integrate with IoTeX’s DePIN Infrastructure Modules (DIMs), enabling secure data storage and computation. The upcoming W3bstream platform will further enhance this by leveraging ZK proofs to verify data from ioID devices. These mechanisms make ioID a powerful identity solution for DePIN projects, ensuring device authenticity and fostering trust across the ecosystem. Throughout 2024, IoTeX conducted testing of ioID with over 10 DePIN projects, including Geodnet, Network3, and Envirobloq. These collaborations helped standardize ioID’s offering, making it a universal identity solution tailored to the requirements of the DePIN sector. IOTX deposit fees will be burnt, staked, or dispersed to ecosystem-owned token pools like the Marshall DAO and Roll-DPoS rewards pool. The goal of ioID tokenomics will be to incentivize DePIN projects to adopt ioID, reduce the total supply of IOTX via deflationary burn in proportion to ioID registrations, and reward users that opt-in to verify their DePIN devices' identity and activity. ioID unlocks significant potential for the DePIN ecosystem by enabling verifiable device identities. This capability allows DePIN projects to ensure the authenticity and trustworthiness of devices contributing to their networks. As a result, end users may become more willing to pay for data or services from DePIN projects, exchanges may feel more confident listing DePIN tokens, and regulators could craft more meaningful legislation tailored to the sector. Beyond these broad benefits, ioID introduces new primitives for DePIN builders. One example is authorization and access control, where devices with ioIDs can be issued verifiable credentials to ensure only specific devices or owners interact with smart contracts, dapps, or mining rewards. ioID's programmability also allows for fractional ownership and financing of devices, enabling complex ownership hierarchies. For instance, a device’s principal and cash flows could be split among multiple owners who contribute to financing, installation, or maintenance, supporting DePIN projects’ supply-side growth. Additionally, ioID NFTs open opportunities for lending, borrowing, and trading devices. As ioIDs are represented onchain as NFTs, they can be traded or used as collateral in lending arrangements. This could enable scenarios where device installers sell pre-installed devices to passive investors or DePIN miners to access liquidity by lending their ioID NFT and associated cash flows to others. These innovations position ioID as a foundational technology for advancing DePIN infrastructure and creating new economic models within the DePIN ecosystem. To realize a blockchain-orchestrated DePIN agent swarm, all AI agents must register their ioIDs with an AI agent registry on the blockchain. Leveraging the Quicksilver framework, the AI agent registry contains each agent’s onchain and offchain identities and their role and specialty. The coordinator agent monitors the AI agent registry and updates its knowledge each time a new DePIN agent joins the swarm. By resolving an agent’s DID, the coordinator agent can obtain its DID document and then find its service endpoint. W3bstream Currently, W3bstream is live on its Devnet, with IoTeX targeting the launch of the Testnet in Q1 2025. This milestone will mark a significant step in providing developers with scalable and verifiable computing infrastructure to build and innovate in the DePIN sector. W3bstream is a verifiable compute protocol designed to validate the real-world activities and data produced by devices in the DePIN ecosystem. By leveraging ZK proofs, W3bstream ensures the trustworthiness and provenance of data before it is settled onchain. This approach provides a critical layer of reliability for DePIN builders, enabling them to confirm the accuracy of metadata and real-world data from devices. As a permissionless and chain-agnostic computing engine, W3bstream will be the foundation for Proof of Utility use cases within DePIN networks. For example, in renewable energy DePINs, W3bstream can ingest data directly from energy-producing hardware, such as solar panels, and generate validity proofs. These proofs allow anyone to independently verify the amount of energy produced by a specific device or the entire DePIN network. This level of verifiability enhances transparency and trust for stakeholders across DePIN applications. Once live W3bstream is natively integrated with ioID, it will be able to process signed data from ioID-equipped devices. This integration ensures end-to-end device identity and utility verifiability, further strengthening DePIN ecosystems' integrity. Incentive Initiative On October 29, 2024, IoTeX, in collaboration with OKX, Gate, and other DePIN projects, launched the Get Goated Season 2 campaign. This initiative spans three months, concluding on January 29, 2025, and is designed to incentivize users to participate in DeFi and DePIN-related tasks across selected protocols. Participants can deepen their engagement with the DePIN ecosystem by completing these tasks while earning substantial rewards. The rewards pool for Get Goated Season 2 includes 100 million IOTX tokens and $2 million in contributions from 20 DePIN projects. Participants earn campaign-specific credits called BinoBits by completing eligible activities. Each user’s proportional share of BinoBits, relative to the total awarded during the campaign, determines their share of the overall rewards. The distribution of rewards is divided into two primary categories. 70% of the IOTX rewards, equivalent to 70 million tokens, are allocated for task-based incentives. These tokens are distributed based on the BinoBits users earn through eligible activities. The remaining 30%, or 30 million IOTX, is set aside for liquidity pool farming incentives distributed through farming on Mimo and iZUMi. The campaign features activities across 9 DeFi protocols, encouraging users to participate in trading, liquidity provision, staking, asset bridging, and referral programs. For example, liquidity providers can add liquidity to specific trading pairs on Pinswap. Staking is available on protocols such as Bedrock and Loxodrome, while participants who bridge assets to IoTeX receive additional BinoBits, with bonus rewards for the first ten bridges each day. A referral program also incentivizes participants to invite others to join the campaign using unique referral links. In addition to DeFi activities, 20 DePIN projects are participating in the campaign, contributing a total of $2 million in DePIN tokens. As the campaign concludes on January 29, 2025, IoTeX and its partners will distribute the rewards. This process includes enabling users to convert points earned from Galxe social tasks into BinoBits and allocating rewards based on the BinoBits earned by participants. As of January 15, 2025, the top three protocols in terms of BinoBits distributed are IoTeX staking, Mimo, and ioPay. Technology Upgrades The Q4 upgrades to the IoTeX L1 continued the network’s evolution following the IoTeX 2.0 upgrade in Q3. IoTeX 2.0 established a modular infrastructure for DePIN development, designed to support a wide range of participants, including dapps, traditional companies, and small development teams. This modular architecture features components like DePIN dapps, pre-built DePIN Infrastructure Modules (DIMs) such as ioID and W3bstream, a Modular Security Pool (MSP) secured by IOTX, and the IoTeX L1 itself. In Q4, IoTeX prioritized updates to improve compatibility, performance, and functionality. On October 15, the Cancun EVM compatibility upgrade was approved with unanimous community support. This update introduced EIP-4844 for blob transactions, a critical feature for ZK application integrations, along with new EVM instructions to maintain compatibility with the latest versions of the Solidity compiler. These changes strengthened IoTeX’s interoperability with the Ethereum ecosystem and supported the growing demand for ZK-enabled applications. Several incremental updates to IoTeX Core were released throughout the quarter. Versions 2.0.5, 2.0.6, 2.0.7, and 2.0.8 addressed minor fixes and performance improvements, such as resolving minting inefficiencies and API node issues. While these updates contributed to network stability, the most significant development in Q4 was the release of IoTeX Core V2.1. IoTeX Core V2.1 was introduced on December 3 and activated through a hard fork on December 17, with all node operators required to update before the upgrade. This release implemented Cancun EVM compatibility, integrating EIP-4844 for blob transactions, EIP-1559 for dynamic fee transactions, and EIP-2930 for access list transactions. These enhancements significantly improved the network’s ability to process advanced transaction types and strengthened its alignment with Ethereum’s evolving standards. In addition to feature upgrades, v2.1 resolved critical bugs, including ensuring accurate clearing of staking bucket amounts after unstaking and setting staking duration limits to prevent indefinite staking periods. Closing Summary In Q4 2024, IoTeX achieved significant growth, with average daily transactions surging 1,267% QoQ to 384,300 and total fees increasing by 205% QoQ to $448,500, fueled by the launch of ioID and the Get Goated Season 2 incentive campaign. The introduction of ioID in November established a universal onchain identity solution for smart devices, unlocking advanced DePIN use cases such as verifiable device identities and fractional ownership. IoTeX also advanced AI integration with BinoAI, an autonomous agent powered by the ELIZA framework, and a strategic partnership with Eliza Labs to enable AI agents to leverage DePIN data in real-world applications. Key partnerships, including Nubila for ESG data and Streamr for decentralized data streaming, expanded IoTeX’s ecosystem. The IoTeX Core v2.1 upgrade delivered critical functionality such as Cancun EVM compatibility, positioning the network for continued innovation in DePIN and AI-driven infrastructure.
Source: Austin Weiler — Published: 2025-02-05T14:01:00ZAlgorand Q4 2024 Brief
Key Insights Algorand’s market cap grew 151% QoQ, increasing from $1.1 billion to $2.8 billion. New addresses in Algorand increased by 176% QoQ, from 1.3 million to 3.5 million. Network transaction fees rose 124% QoQ to $144,000, reflecting higher engagement, while average daily transactions increased 66% QoQ to 3.5 million, driven by staking rewards and ecosystem growth. ZTLment, a European fintech company, migrated from Ethereum to Algorand in October 2024, leveraging Algorand’s Atomic Transactions and multisig approvals to enhance efficiency and compliance for regulated payments. GP13 allocated 17.2 million ALGO and introduced governance reforms, including the creation and eligibility of the xGov Council. Primer Algorand (ALGO) is a smart contract platform using a Pure Proof-of-Stake (PPoS) consensus mechanism. The protocol was founded by Turing award-winning computer scientist Silvio Micali, also known for co-inventing zero-knowledge proofs, Verifiable Random Functions (VRF), and probabilistic encryption. In Q1 2025, Algorand introduced staking rewards, allowing node operators to earn incentives for proposing blocks. Unlike other PoS networks, Algorand’s staking model features no slashing, no lockups, instant payouts, and low hardware requirements, making participation more accessible. These updates enhance network security and decentralization while maintaining flexibility for users. Like relying on stake weight in consensus, Algorand PPoS randomly selects consensus nodes based on their ALGO balances using a Verifiable Random Function (VRF), where having a larger balance increases the holder’s chance of selection. Algorand’s smart contract execution layer is powered by the Algorand Virtual Machine (AVM). Algorand supports smart contract development in Python and other community-developed languages. Algorand Technologies leads development, while the Algorand Foundation, a not-for-profit, supports governance, ecosystem funding, and community-driven development. Website / X (Twitter) / Discord Key Metrics Performance Analysis Network Transactions Total protocol revenue on Algorand, which includes fees collected from network transactions, increased by 124% QoQ, rising from $64,000 in Q3 2024 to $144,000 in Q4 2024, and by 575% YoY, up from $21,000 in Q4 2023. Additionally, average daily transactions grew from 2.1 million to 3.5 million, while total transactions increased from 193 million to 321 million over the same period. This growth can be attributed to several key developments in Q4 2024. The announcement of inclusive staking rewards in November likely encouraged greater validator participation, which increased onchain activity. Initiatives such as Coinbase Quests drove new user engagement, leading to a rise in wallet downloads and dApp interactions. Additionally, Kare Wallet’s deployment for disaster relief contributed to higher transaction volumes. A significant increase in ALGO’s price also played a role. The token surged 149% QoQ, rising from $0.13 to $0.33. Since transaction fees are denominated in ALGO, this price increase amplified the dollar value of fees collected, boosting protocol revenue. The number of new addresses on Algorand increased significantly in Q4 2024, rising 176% QoQ from 1.3 million in Q3 to 3.5 million and 91% YoY compared to Q4 2023. Similarly, the daily average of new addresses created rose from 14,000 in Q3 2024 to 38,000 in Q4, reflecting a 91% YoY rise. Two significant spikes contributed to this growth: October 22, 2024: A record high of 553,000 new addresses was created on this day. This increase is attributed to the ongoing impact of the Coinbase Quests program, which incentivized wallet creation and dApp engagement with rewards for interacting with platforms like Pera Wallet and Folks Finance. The migration of ZTLment to Algorand in early October, showcasing the network’s use in regulated payments, also likely contributed to new wallet creation around this period. November 7, 2024: Another spike of 270,000 new addresses coincided with the announcement of inclusive staking rewards, which attracted users by enabling staking without lockups or penalties, and the introduction of liquid staking, which increased activity on DeFi platforms. Additionally, updates to Pera Wallet and improved app discovery through Pera Discover may have encouraged further wallet activity. Daily transactions also grew considerably, increasing 66% QoQ from 2.1 million in Q3 to 3.5 million in Q4 and 208% YoY from 1.1 million in Q4 2023. This growth reflects increased network activity driven by staking rewards, DeFi participation, and applications such as Kare Wallet for disaster relief, tokenized renewable energy credits, and broader ecosystem engagement efforts. Staked ALGO Governance on Algorand has followed a unique model compared to many other blockchains. Participants can earn rewards by committing ALGO to governance, but this process does not contribute to network security. If a user’s committed balance falls below the required threshold, they become ineligible for rewards. Instead of using the Algorand Foundation’s governance interface, users can participate via Folks Finance’s Liquid Governance program, the largest DeFi protocol on Algorand. This program allows users to engage in governance by staking (rather than committing) ALGO in exchange for gALGO, a liquid governance token. However, this system is being phased out after Governance Period 14 (GP14), marking Algorand’s transition from governance rewards. Starting in Q1 2025, Algorand will fully transition from governance-based rewards to a staking-based incentive model. Under the new system, staking ALGO will contribute directly to network security, with rewards distributed to block producers instead of governance participants. In this new structure, liquid staking tokens like xALGO will emerge as alternatives for users seeking to earn staking rewards while maintaining liquidity. Various DeFi platforms, including Folks Finance, Tinyman, Messina, CompX, and Réti Pools, will offer different methods for earning staking rewards. In Q4 2024, the amount of staked ALGO on Algorand declined by 20% YoY and 3% QoQ, reaching 1.52 billion ALGO, the lowest level in a year. This decline can be attributed to the reduction in governance rewards, which decreased from 32 million ALGO in Q4 2023 to 17.2 million ALGO in Q4 2024, discouraging some participants. The percentage of the eligible Algorand supply staked also fell by 2% QoQ, standing at 18%, while Algorand’s circulating supply increased by 0.7% to 8.3 billion ALGO. While the Algorand 4.0.1 protocol upgrade was introduced in late December 2024, bringing staking rewards and encouraging validator participation, its impact on staking behavior will likely materialize in early 2025 as the adoption of the upgrade progresses. The declining governance rewards reflect Algorand’s strategic transition from a heavily incentivized governance model toward staking-based incentives. This shift aims to create a more sustainable and decentralized ecosystem, though the transition phase has led to temporary decreases in staked ALGO during Q4 2024. Stablecoins The market cap for stablecoins on Algorand experienced a decline in Q4 2024, dropping from $113 million in Q3 to $57 million. This reflects a 50% decrease in QoQ and a 26% decline YoY from $78 million. Most of this decline was driven by a significant reduction in USDC’s market cap, which fell from $110 million to $53 million, representing a 51% QoQ drop. The decrease in USDC’s market cap may be attributed to a combination of factors. In the previous quarter, USDC saw strong growth due to Algorand’s integration with Coinbase and the Coinbase Learning Rewards program, which encouraged USDC transactions on the network. Other stablecoins on Algorand displayed mixed performance during the same period. USDT’s market cap remained stable, while EURD saw a 16% QoQ decrease, falling from $1.1 million to $950,000. Smaller-cap stablecoins recorded an 8% QoQ increase, rising from $670,000 to $730,000. Despite the decline, USDC continued to hold the majority of the stablecoin market on Algorand, with a 94% market share. USDT and EURD slightly increased their shares, with USDT growing from 2% to 4% and EURD from 1% to 2% in Q4. DeFi In Q4 2024, Algorand’s DeFi ecosystem experienced substantial growth, with Total Value Locked (TVL) increasing by 73% QoQ, rising from $194 million to $335 million. This expansion was driven by increased activity across major platforms, including Folks Finance, Tinyman, Pact, and Lofty. Among these, Folks Finance recorded the largest gain, growing 122% QoQ from $84 million to $187 million, while Tinyman and Pact saw increases of 82% and 42% QoQ, respectively. Lofty also experienced a 28% QoQ rise, reaching $51 million in TVL. Several factors contributed to this trend. Algorand launched inclusive staking rewards in November 2024, attracting users to participate in staking without lockups or penalties. Additionally, the introduction of liquid staking on platforms like Folks Finance and Tinyman encouraged greater engagement in DeFi. Tokenized assets such as regulated euro-pegged tokens, tokenized farmland, and real estate also played a significant role in expanding use cases and driving user participation. The network added 1.9 million new active addresses, reflecting a 176% QoQ increase in new addresses, which supported higher engagement and transaction volumes across DeFi protocols. Increased interest in Real-World Asset tokenization, particularly through Lofty, and broader ecosystem engagement efforts, such as developer initiatives and partnerships like ZTLment’s migration to Algorand, further fueled growth. Market Cap Algorand’s market cap grew by 151% QoQ, rising from $1.1 billion to $2.8 billion in Q4 2024. This growth closely aligned with a 149% increase in ALGO’s price, which rose from $0.13 in Q3 to $0.33 in Q4. Despite the sharp price increase, Algorand’s circulating supply saw only a modest rise of 0.7%, increasing from 8.2 billion to 8.3 billion tokens. On a YoY basis, Algorand’s market cap expanded by 56%, up from $1.8 billion in Q4 2023, reflecting sustained long-term growth. This surge in valuation also improved Algorand’s overall market ranking, moving from 66th place in Q3 to 48th in Q4 2024. The sharp market cap and token price increase suggest stronger investor confidence, increased adoption, or favorable market conditions driving demand for ALGO Qualitative Analysis Governance The Algorand Foundation operates two governance programs: Community Governance and xGov. Community Governance runs quarterly, addressing key ecosystem decisions. The xGov pilot, which ran from Q3 2023 to Q2 2024, allowed participants to vote on fund allocations and strategic decisions. Unlike standard governance, xGov required participants to vote in each session or risk losing their staked ALGO, with forfeited stakes redistributed to those who completed the term. In Q3 2024, xGov transitioned to a public beta, updating eligibility criteria to link voting power to the number of blocks an address proposes, and aligning participation more directly with consensus activities. Although the Governance Period 12 (GP12) took place in Q3 2024, the proposed measures had implications extending into subsequent periods. During this period, 11 key initiatives were implemented, with a total allocation of 22.5 million ALGO across various projects. Of this, 11.25 million ALGO (50%) was directed to General Governance Rewards, while the remaining 11.25 million ALGO was allocated to DeFi Rewards. Within the DeFi Rewards category, up to 50% (5.625 million ALGO) was designated for targeted DeFi projects, with the remaining funds supporting general DeFi rewards to foster decentralized decision-making across the Algorand ecosystem. Targeted DeFi Rewards Allocation: Algomint: 206,491 ALGO to enhance liquidity in specific pools. AlgoRai: 165,795 ALGO for yield opportunities and educational programs. Cometa: 183,458 ALGO to drive cross-chain liquidity and users from Layer 2 chains. CompX Labs: 118,581 ALGO to increase TVL, transaction volume and attract new users. Folks Finance: 1,406,250 ALGO to attract users from other chains and raise TVL. Meld Gold: 131,925 ALGO for liquidity retention and brand awareness. Messina.one: 503,416 ALGO for cross-chain community engagement. Pact: 1,015,567 ALGO to increase liquidity and user numbers. Tinyman: 1,406,250 ALGO to enhance liquidity and trading volume. Wormhole: 120,124 ALGO to encourage asset bridging and liquidity growth. Governance Period 13 (GP13) took place in Q4 2024, introducing three pivotal measures to refine and decentralize Algorand's governance framework. During this period, 1.5 billion ALGO was committed, and 17.2 million ALGO in rewards were distributed. Unlike previous periods, GP13 prioritized structural governance improvements over direct reward allocations, setting the foundation for a more community-driven governance model. This governance cycle also focused on transitioning to staking rewards and preparing for the phase-out of incentivized governance, further empowering community decision-making. Key Measures Approved: Establishing the xGov Council: A measure to create an elected xGov council was approved. This council will oversee the grant processes, reduce reliance on the Algorand Foundation, and enhance transparency and accountability. Council members will be elected by the community for fixed terms and tasked with managing proposals that meet eligibility criteria. xGov Council Member Eligibility: Eligibility criteria for xGov council candidates were expanded to include any community member with relevant experience. This change allows for broader participation and introduces diverse perspectives into Algorand’s governance. Eligibility to Vote for xGov Council Members: A measure to determine voter eligibility for xGov council elections was also approved. This ensures that the voting process remains inclusive and aligns with Algorand's decentralized ethos. Developments and Highlights Technical Advancements Staking Rewards Launch: Algorand announced inclusive staking rewards in November, allowing validators to earn 10 ALGO per block without slashing penalties or token lockups. Validators earn 50% of the transaction fees from proposed blocks. The rewards decay by 1% every 1 million blocks, combining real-time incentives with non-inflationary mechanisms to support over 2 billion transactions. NodeKit and Node Operations: Algorand streamlined node creation with tools like NodeKit, making it easier for participants to join the network. To earn rewards as a solo validator, a node must stake a minimum of 30,000 ALGO. Liquid Staking on Algorand: Liquid staking was introduced, enabling users to stake ALGO and receive liquid tokens (e.g., xALGO) for DeFi activities. Platforms like Folks Finance, Tinyman, and CompX offer staking services with no lockup periods or penalties, enhancing ecosystem flexibility. Algorand 4.0.1: In December 2024, Algorand released version 4.0.1 of its protocol, introducing native consensus participation incentives. This update allows validators to opt into a rewards program based on specific balance requirements, enhancing network security and activity. It also features an automatic heartbeat function to help eligible nodes maintain consistent online performance, ensuring smoother network operations. Additionally, the update includes support for zero-knowledge proof applications through new MiMC hash function opcodes and addresses network handling issues. Partnerships and Ecosystem Initiatives Kare Wallet for Disaster Relief: Kare Wallet leveraged Algorand’s blockchain to deliver rapid, fraud-free cash aid to disaster survivors in Tennessee, Florida, and Maui. Secure digital IDs and blockchain tracking reduced processing times to minutes, ensuring efficient and accountable distribution. Nasdaq TradeTalks – Climate Tech & Tokenization: Algorand’s Marc Vanlerberghe and Jasmine Energy’s Nathalie Capati discussed tokenization for renewable energy credits (RECs). They highlighted Algorand’s carbon-negative blockchain for tracking RECs, supply chain tracing, and tokenized carbon insets to reduce emissions. Regional Hackathons and Innovation: Developers from Vietnam, France, and Nigeria created localized blockchain applications during regional hackathons. Winning projects included "AlgoIDE" (Vietnam, developer tools), "Vibepass" (France, ticketing), and "Agroshop" (Nigeria, agricultural supply chains). ZTLment’s Move to Algorand: In Q4 2024, ZTLment, a European fintech company, migrated from Ethereum to Algorand to enhance its operational efficiency and scalability. The move enabled a sevenfold reduction in development time, largely due to Algorand’s built-in features such as Atomic Transactions and multisig approvals, which simplified processes and reduced the need for extensive custom development. These tools also supported compliance with Europe’s Payment Services Directive 2 (PSD2), a key regulatory framework for financial services. Atomic Transactions on Algorand allow for batching multiple operations into a single unit, ensuring that all transactions succeed or fail together. This functionality reduces the risks associated with delivery-versus-payment and simplifies fund management processes, which are critical for ZTLment’s escrow-based payment services. Additionally, Algorand’s multisig approvals provide added security by requiring multiple pre-authorized parties to approve specific actions. The transition to Algorand has allowed ZTLment to streamline its payment operations and develop solutions more efficiently, particularly for mid-sized platforms that lack in-house financial compliance capabilities. UNDP Blockchain Academy Expansion: Algorand partnered with the UNDP Blockchain Academy to train 24,000 UN personnel globally. The initiative focuses on applying blockchain to sustainable development goals, such as supply chain transparency and inclusive finance. Key Announcements and Programs AlgoCafe in Bangkok: Hosted during DevCon, this two-day event brought developers, blockchain enthusiasts, and media together for workshops, mini-MBA sessions, and networking events. Global participants explored topics like staking, node deployment, and community building. Pera Wallet Updates: Pera Wallet played a key role in the Coinbase Quest program and teased a debit card with Immersve, enabling USDC spending at fully onchain merchants. Additionally, Pera Discover updates enhanced app discovery and user verification. "Can a Blockchain Do That?" Marketing Campaign: Algorand launched a new campaign to showcase real-world use cases, targeting developers and enterprises. The campaign highlights Algorand’s unique features, such as carbon-negative infrastructure, instant transaction finalization, and modular components. Community and Developer Engagement Developer Efficiency and ROI: Algorand was recognized for offering a 600% faster development ROI than Ethereum. Developers benefited from Python-based tools and built-in protocol capabilities like multi-sig and atomic transactions, which reduced project completion times and costs. Completion of Algorand Incubator: The first cohort of the Algorand Incubator graduated, featuring 14 early-stage startups focused on tokenization, staking platforms, and decentralized applications. These projects now enter the Ecosystem Success program, receiving continued support for scaling and community-building. Closing Summary Algorand’s DeFi TVL grew 216% QoQ to $417 million, driven by increased activity on Folks Finance, Tinyman, and Lofty, with key contributions from liquid staking and RWA tokenization. Meanwhile, the stablecoin market cap fell 50% QoQ, primarily due to declining USDC usage. Network activity surged, with daily transactions up 66% QoQ to 3.5 million and new addresses rising 176% QoQ, fueled by Coinbase Quests and anticipation of staking rewards. Transaction fees increased 124% QoQ to $144,000, reflecting heightened activity. Governance advanced with the launch of the xGov Council, while GP13 allocated 17.2 million ALGO in rewards and shifted focus toward staking incentives. Technical upgrades like NodeKit and partnerships in disaster relief and renewable energy tokenization further expanded Algorand’s real-world applications. Algorand’s market cap rose 151% QoQ to $2.8 billion, driven by a 149% increase in ALGO’s price, reflecting stronger adoption and investor confidence.
Source: Armita — Published: 2025-02-05T14:00:00ZState of Sia Q4 2024
Key Insights Sia’s V2 hard fork is scheduled to activate on June 6, 2025, introducing usability and performance improvements to its blockchain and storage network. Sia saw increases across various metrics in Q4, including network revenue (+28.70%), SC price and market cap (+11.57%), new contracts (+3.82%), and download bandwidth costs in SC (+8.68%). In contrast, Sia also saw declines in used storage (-14.29%), storage utilization (-14.63%), active contracts (-6.93%), upload bandwidth costs in SC (-2.30%), and total transactions (-5.94%). The Sia Foundation adhered to EU MiCA regulations and released renterd v1.1.0 and hostd v2.0.0-alpha.4, preparing for the Sia V2 hard fork (Utreexo). The Sia Foundation approved $161,780 for six projects: Dartsia Mobile App V2, Lume Web 2025, SiaQL, SiaGraph #2, Proxmox Backup Cloud Extension, and Sia Virtual Block Device (siavbd) - improving Sia’s mobile tools and developer ecosystem. Previously funded projects like Sia NFS Gateway, Fabstir Web3 Media Player, and SiaGraph achieved various milestones, expanding Sia’s functionality and adoption. Primer Sia is a decentralized cloud storage network that combines a Proof-of-Work (PoW) blockchain with a contract-based storage model. Storage contracts uphold storage agreements between hosts (storage providers) and renters (storage consumers). Renters define the amount of data to be stored, the timeframe for storage, and the price. As users and storage providers enter into storage contracts, they deposit the native asset — Siacoin (SC) — into an escrow account. Storage providers must cryptographically prove they are hosting the required data, and if they do not uphold the storage contract, their collateral is slashed. At contract expiry, the storage provider receives most of the escrowed funds, with a small portion (3.90%) going to holders of Siafund (SF) tokens. Siafunds are security tokens that accrue SC to the SF holder from finished contracts on Sia. Sia facilitates a global data storage marketplace by connecting storage providers with underutilized hard drive capacity to storage consumers. Siacoin can be used to pay for gas on the Sia blockchain and as the medium of exchange for the storage market. Renters pay a storage fee, upload/download bandwidth prices, and gas to create storage contracts. Files stored on Sia are encrypted via ChaCha20 and stored redundantly via Reed–Soloman Erasure Coding. Encryption ensures that uploaded files remain private, and redundancy ensures security by sharding files. Files uploaded to Sia are split into 30 shards, or chucks, and sent to various hosts. Only 10 shards are required to rebuild the file, and their copies are re-duplicated to new hosts whenever one is offline. For a full primer on Sia, refer to our Initiation of Coverage report. Website / X (Twitter) / Discord Key Metrics Performance Analysis Transactions and New Contracts New storage contracts are a measure of the origination of active storage contracts. New contracts require renters to allocate funds (called allowances) in advance. These allowances determine how much SC the renters are willing to pay for storage on Sia. The allowance is derived by multiplying the price in SC per TB stored by the expected number of TBs and by the expected number of months for storage. For example, if a user wanted to store 3TB of data for three months at 500 SC per TB, their allowance would be 4,500 SC (3x3x500). Renters also pay contract formation and upload bandwidth fees when creating new contracts. Hosts must lock up collateral, which can be slashed if they do not uphold the contract agreement. Transactions on Sia account for all activity related to storage contracts, peer-to-peer transfers, and trades of the SC token. New contracts lead to various types of onchain transactions, such as contract initiation payments, bandwidth payments, and ongoing storage payments. For this reason, transaction count tends to be influenced by initiating new contracts. In Q4, average daily new contracts increased ~3.82% QoQ and ~82.51% YoY. However, average daily transactions declined ~5.94% QoQ despite a ~63.59% YoY increase. This suggests that other types of transaction activity, such as renewals, declined relative to the growth in new contracts. At face value, the rise in new contract initiations aligns with the continued improvement of Sia's renterd and hostd modules discussed below in the qualitative analysis section. Active Contracts When a contract is active, it automatically facilitates the exchange between escrowed SC and storage provided by hosts. Average daily active contracts declined for the second consecutive quarter, dropping ~6.93% QoQ and down ~7.99% YoY. This may indicate that contracts initiated earlier in the year had shorter durations or that renters did not renew existing contracts at the same rate as new contracts were being created. Storage Utilization While a storage network's capacity helps highlight its current scale, its utilization rate reveals the demand for the type of storage it optimizes for. Sia operates in the hot storage market, primarily targeting developers. It's favored by those searching for a decentralized storage system offering privacy and fast retrieval. Storage demand on Sia flows through storage contracts, incentivized by its Stake-for-Access (SFA) token model. For this reason, storage demand is closely linked to active contracts. Specifically, in Q4, used storage declined ~14.29% QoQ, though still up ~67.80% YoY. Storage utilization rates dropped ~14.63% QoQ and ~8.21% YoY, reflecting a decrease in efficiency relative to capacity. While active contracts declined ~6.93% QoQ, despite a ~3.82% increase in new contracts, the reduction in storage metrics suggests that a significant number of existing contracts expired or were underutilized. Storage Prices Renters entering a storage contract on Sia pay multiple fees to set up and maintain the contract. Storage fees are based on the amount of data uploaded, the length of the contract, and the price in SC per TB per month. As Sia’s used storage declined in Q4, average storage costs measured in SC increased by ~9.65% QoQ and ~41.74%YoY, while average storage costs in USD rose ~36.68% QoQ, yet remained up only ~1.24% YoY. The rise in USD-denominated storage costs reflects the ~119.01% jump in the SC price during the quarter – as shown in the market cap analysis section. This rise in both SC and USD-denominated costs aligns with the overall decline in storage utilization in Q4, which suggests that the higher costs affect renters' storage behavior. Bandwidth Costs Storage providers offload the costs of uploading and downloading the renter’s data to the individual renter. Users seeking to store data on Sia initially pay upload fees to hosts, and users seeking to retrieve uploaded data pay download fees to hosts. In both cases, bandwidth is priced per TB. Bandwidth costs denominated in SC moved in opposite directions during Q4: upload costs dropped ~2.30% QoQ and ~61.54% YoY, while download costs increased by ~8.68% QoQ and ~27.31% YoY. The drop in SC-denominated upload costs made storage contracts more affordable for renters already holding SC, potentially supporting storage activity during the quarter. Conversely, the rise in SC-denominated download costs reflects increased demand for data retrieval services. In USD terms, upload costs mirrored their SC-denominated decline, falling ~2.30% QoQ and ~72.51% YoY, while download costs rose ~8.68% QoQ, yet remained down ~9.07% YoY. Network Revenue Sia produces revenue for multiple parties: hosts, miners, and Siafund (SF) holders. Its network revenue is the sum of payouts to hosts, Siafund fees, miner fees, and burned collateral. Burned collateral is included in revenue because burning SC makes it more scarce, accruing value to SC holders. Despite declines in storage demand (~14.29% QoQ) and active contracts (~6.93% QoQ), network revenue grew ~28.74% QoQ to reach $154,509 in Q4. This growth can be attributed to the ~9.65% increase in SC-denominated storage costs, the ~8.68% rise in SC-denominated download costs, and the ~11.57% increase in SC’s price during the quarter. While improvements to hostd and renterd modules may have supported operational efficiency and user adoption, the primary driver of revenue growth appears to be higher SC prices and increased SC-denominated costs, rather than an expansion in overall network activity. Market Cap Relative to BTC and ETH benchmarks, which saw their market caps grow ~48.00% and ~28.30% QoQ, respectively – SC’s market cap increased ~11.57% QoQ to ~$570 million. Its market cap rank, however, fell from 181 in Q3 to 272 in Q4, reflecting a decline in its relative positioning within the broader crypto market. SC’s price similarly rose ~11.57% QoQ to ~$0.09. As a recap, despite this, upload costs denominated in SC dropped ~2.30% QoQ, potentially making storage contracts more affordable for renters already holding SC. For these renters, the reduced SC-denominated costs may have mitigated the impact of rising USD-denominated costs, which increased ~8.68% QoQ for download bandwidth and ~36.68% for average storage costs. However, renters purchasing SC at the higher market price during the quarter – driven by the ~11.57% QoQ increase in SC price – faced steeper USD costs for both storage and bandwidth. This dynamic likely contributed to the decline in storage demand (~14.29% QoQ) and active contracts (~6.93% QoQ), as rising dollar costs for new renters offset benefits from reduced SC-denominated costs for existing users. While Sia’s product updates, including hostd and renterd module enhancements, improved operational efficiency and user experience, these developments were insufficient to counterbalance the impact of higher USD-denominated costs on overall network activity. Qualitative Analysis Regulation In Q4 2024, the Sia Foundation published new sustainability metrics in compliance with EU MiCA regulations, ensuring Siacoin (SC) remains accessible on EU exchanges. Software Updates Sia modules renterd and hostd saw incremental upgrades that improved the network’s storage performance, usability, and reliability. For renterd, these upgrades included (i) refining host scanning and pricing mechanisms, (ii) a new download algorithm ensuring data retrieval from all contracted hosts, and (iii) API restructuring to support V2 enhancements. Its UI added advanced features (e.g., batch file management), while backend updates transitioned consensus.db to blockchain.db for improved data integrity and efficiency, marking a key milestone with the release of renterd v1.1.0. For Hostd, the release of v2.0.0-alpha.4 (i) streamlined RHP settings in the config manager via RHP4 and (ii) introduced command palette access for more straightforward navigation across platforms. Furthermore, updates to Walletd improved balance refresh rates and address generation, while explored added V2 transaction support, host announcements, and robust API testing. These updates collectively advanced Sia’s ecosystem, setting the stage for the upcoming V2 hard fork launch (Utreexo), its most significant upgrade since its mainnet launch in 2014 – scheduled to activate on June 6, 2025. Among other proposed improvements to Sia, this upgrade will primarily replace its traditional UTXO database with a cryptographic accumulator, reducing the initial sync time for nodes. This modification will scale Sia’s data storage and consensus code, enabling full nodes to run on smartphones, embedded devices, or browsers. Ecosystem Grant Update The Sia Grants Program introduced several updates to improve compliance and streamline the review process, including (i) a public list of restricted countries requiring applicants to affirm eligibility upfront, (ii) new grant categories with monthly payment caps to distinguish between Standard and Large grants, (iii) proposal templates addressing country restrictions and progress report templates emphasizing pre-funded accounts and credentials for smoother onboarding, and (iv) an FAQ outlining ineligible project types to guide applicants toward feasible, impactful proposals. Furthermore, the Sia Foundation continues to support ecosystem growth through its grant program, which has approved ~$1.8 million in total funding since its inception. Grants are decided biweekly by a committee of three foundation employees and three community members. In Q4’24, the foundation approved $161,780 in grant funding, marking its highest funding quarter in 2024. Specifically, they approved the following six projects: Dartsia Mobile App V2 - $41,250 The Sia Foundation approved $41,250 for James Brel Tamegno and Egoume Mouyong Rekiyatou to develop Dartsia Mobile App V2. This app allows mobile users to securely access and interact with renterd nodes within the Sia ecosystem. The team plans to enhance V1 by adding a file encryption feature, a phone file backup feature similar to Google Drive, notification functionality, a file viewer compatible with various file types (e.g., documents and videos), and an SQLiteDB backup system for the renterd server. Lume Web 2025 - $73,000 The Sia Foundation approved $73,000 for Hammer Technologies LLC to advance Lume Web, a Layer-2 solution for decentralized storage built atop the Sia network. Key 2025 goals include: Anti-Abuse Plugin, Bluesky Integration Plugin, Nostr Integration Plugin, LBRY Integration Plugin, Cloud Import Integration Plugin, IPNS Support, and a Community Portal. SiaQL - $18,000 The Sia Foundation approved $18,000 for Mert Köklü to develop SiaQL, a GraphQL interface designed to unify interactions with Sia's core components: hostd, renterd, and walletd. By consolidating these separate REST APIs into a single GraphQL layer, SiaQL aims to streamline complex queries and improve developer efficiency. The project will deliver a command-line interface (CLI) application that launches a local GraphQL server, complete with a built-in editor and comprehensive documentation. SiaGraph #2 - $4,730 The Sia Foundation approved $4,730 for CtrlAltDefeat to enhance SiaGraph, a website offering data and insights into the Sia network. Building upon previous work, this grant focuses on expanding functionality and usability by introducing features such as renting statistics, tokenomics data, a host troubleshooter for on-demand testing, and lastly, a complete backend rewrite to facilitate easier data collection and the integration of new metrics. Proxmox Backup Cloud Extension (Continuation) - $16,800 The Sia Foundation approved $16,800 for A-Z Computer Solutions to continue integrating Proxmox Backup Server (PBS) with the Sia network. This phase focuses on refining the existing cloud backup module, enhancing the functionality of the Sia renterd plugin, and conducting robust testing to prepare for a public beta release. The project aims to increase data stored on the Sia network by leveraging Proxmox backups, offering a reliable off-site backup solution that adds redundancy for disaster recovery scenarios. Sia Virtual Block Device (siavbd) - $8,000 The Sia Foundation approved $8,000 for Roland Rauch to develop siavbd, a virtual block device implemented on top of renterd. This project introduces location-independent, scalable virtual disks with features like deduplication, compression, snapshots, and branching, fully backed by Sia objects. Available as a standalone binary and Docker image, siavbd adds block storage to Sia's existing object and file system storage options, offering users greater flexibility to choose the most suitable storage type. Development Milestones Throughout Q4 2024, previously funded projects also achieved various development milestones, including: Sia NFS Gateway (sia-nfs) achieved all grant milestones, with funds distributed in November. Proxmox Backup Server Cloud Extension refined middleware for Sia integration, optimized the cloud backup API, enhanced security, improved the UI, and prepared pre-release documentation. Sia SMB Mounts implemented SMB2 protocol features, supported multiple renterd instances, resolved bot protection issues, and conducted public testing. Fabstir Web3 Media Player #2 added scalable infrastructure, encrypted Sia-based storage, decentralized subscriptions, and a digital handshake system for contracts. HTLC Upgrade for Sia for use in Atomic Swaps finalized the Sia Rust library, deployed a web wallet demo, transitioned to the Anagami testnet, and updated SpendPolicy validation for Sia V2, with funding fully distributed in December. Lume Web 2024 fixed dashboard bugs, redesigned the portal frontend, refactored the config system, added RBAC permissions, launched an Akash provider for workloads, developed Docker images, and improved cluster-related support. S5 Network 2024 developed a TypeScript/JS library for the Vup Web app, introduced a blobsum utility for S5 Blob Identifiers, secured the s5.pro domain, and initiated a UI design language with Storybook. Passkey Holder transitioned from Node.js to a browser environment, streamlined registration and authentication, integrated decentralized passkey storage with renterd, and enhanced WebAuthn support. Tiri Vault integrated browser extension features, added a "Sync" menu for directory synchronization with private Sia storage, expanded file management capabilities, and implemented API endpoints for data replication. SiaGraph added a private beta environment, created API endpoints, rewrote the website for modularity, launched a public Explored node at explorer.siagraph.info, and designed a system for creating renterd nodes and collecting statistics. Closing Summary Sia showed resilience in Q4 2024, with network revenue rising ~28.70% QoQ to $154,509, despite declines in active contracts (~6.93% QoQ) and used storage (~14.29% QoQ). Relative to ETH and BTC benchmarks, which saw market cap growth of ~28.30% and ~48.00% QoQ, respectively, SC’s market cap increased ~11.57% QoQ to ~$570 million. Despite this, its market cap rank fell from 181 to 272, highlighting underperformance relative to the broader crypto market. Sia released significant software updates, including (i) renterd v1.1.0, (ii) hostd v2.0.0-alpha.4, and (iii) advanced preparations for its V2 hard fork (Utreexo), its most significant upgrade since 2014. Ecosystem grant funding hit a quarterly high of $161,780, supporting Dartsia Mobile App V2, Lume Web 2025, SiaQL, SiaGraph #2, Proxmox Backup Cloud Extension, and Sia Virtual Block Device (sia_vbd). With these developments and plans for further upgrades, Sia is well-positioned to improve its utility, scalability, and standing in the decentralized storage market in 2025.
Source: Whynonah — Published: 2025-02-04T14:00:00ZState of Akash Q4 2024
Key Insights Akash recorded $742,000 in lease revenue, marking a 144% QoQ and 565% YoY increase. New leases grew 274% QoQ to 61,000, driven by demand for AI and compute-intensive tasks. GPU capacity grew 37% QoQ to 577 units, with usage increasing 42% QoQ to 363 units, reflecting heightened adoption of high-performance workloads like AI and machine learning. Active providers increased by 11% QoQ to 67, supported by the $10 million Provider Incentives Pilot 2 program, which targeted GPU expansion for enterprise applications. The beta release of Akash Console 2.0 introduced fiat payment options and free trials, enhancing user accessibility. Strategic partnerships with Sentinel Scout, Passage, and Witness Chain enabled new use cases, including AI workflows and decentralized data validation. Primer Akash (AKT) is a decentralized cloud computing marketplace that facilitates the buying and selling of compute resources. It is an open-source, permissionless protocol that provides an alternative to today’s centralized cloud services (i.e., AWS, Azure, and Google Cloud). Akash aims to leverage the global amount of underutilized server capacity, which can range from 5% to over 30%. The Akash marketplace functions via a reverse auction, giving users the ability to name a price and describe the resources they want for deployments. Akash’s decentralized network of compute providers runs its open-source software and competes to provide resources, often at a fraction of the cost of big cloud providers. Specifically, Akash hosts containers where users can run any cloud-native application (e.g., AI workloads, gaming servers, blockchain nodes, and websites). Akash offers extensive cloud management services like Kubernetes, which can be used for hosting and managing containers. Additionally, Akash supports decentralized AI applications such as Venice.ai, AkashChat, and AkashGen, reflecting its role in enabling AI infrastructure. Akash is a Tendermint-based blockchain built using the Cosmos SDK. Marketplace activity (requests, bids, lease details, etc.) is stored onchain and payments are settled with Akash’s native token (AKT). For a full primer on Akash, refer to our Initiation of Coverage report. Website / X (Twitter) / Discord Key Metrics Usage and Provider Analysis Leases and Revenue Akash’s marketplace uses a reverse auction, in which users propose a bid that describes the resources they’d like to use for a deployment. When accepted, a lease is opened onchain managing the activity of this relationship. New leases on Akash Network represent agreements between users and providers for renting computational resources. In Q4 2024, Akash recorded a 274% QoQ increase in new leases, rising from 16,000 in Q3 to 61,000 in Q4, and a 317% YoY growth compared to 15,000 in Q4 2023. This growth reflects the impact of key developments in Q3 and Q4 2024. A key driver was NVIDIA’s acquisition of Brev.dev in Q3, which enhanced Akash’s GPU ecosystem and attracted enterprise users focused on AI and high-performance computing. In Q4, Akash’s expansion to three countries in Latin America supported regional adoption. The beta release of Akash Console 2.0 introduced fiat payments and free trials, reducing barriers for non-crypto-native users. Additionally, reduced take rates for uAKT (1%) and axlUSDC (2%) made leasing more affordable, while the launch of permissionless AI access to advanced models broadened Akash’s appeal to developers and researchers, further driving adoption. Active leases on Akash represent ongoing agreements where users utilize and manage computational resources on the network. Leases remain active as long as they are in use and cease once closed. In Q4 2024, Akash Network’s average daily active leases increased 26% QoQ and 74% YoY, rising from 693 in Q3 to 875 in Q4. This growth was driven by strategic integrations, enhanced accessibility, and broader adoption across diverse workloads. Key partnerships, such as those with Sentinel Scout and Passage, introduced scalable and recurring use cases, including AI workflows and immersive virtual events, which contributed to sustained lease activity. Revenue increased more significantly than active leases, with Q4 lease revenue growing 144% QoQ and 565% YoY to $742,000. The disproportionate revenue growth was attributed to higher-value workloads, such as AI and machine learning, facilitated by the availability of advanced GPUs like NVIDIA H100 and A100. These workloads generated higher revenue per lease compared to standard compute tasks. Deployment cost adjustments and new payment options, including credit card support and free trials, further broadened user adoption and encouraged larger deployments. On December 7, 2024, Akash achieved its highest daily revenue of $12,500, driven by 1,058 active leases and 956 new leases created on that day alone. All Resource Compute In Q4 2024, Akash Network demonstrated notable growth across its core resource metrics, reflecting increased adoption of its decentralized compute platform. GPU usage grew 42% QoQ to 363 units, a 428% YoY increase, while capacity expanded 37% QoQ to 577 units, marking a 269% YoY rise. Initiatives like the Incentives Pilot 2 program and partnerships with NVIDIA (via Brev.dev) and Venice.ai played a key role in expanding capacity and attracting enterprise users with resource-intensive applications. The sustained increase in GPU usage reflects both new user adoption and ongoing utilization by existing users. CPU usage declined 18% QoQ to 4,500 units, though it increased 123% YoY. Capacity grew 27% QoQ to 21,000k units, a 274% YoY increase, ensuring the platform remained prepared for diverse computational needs despite shifting user preferences toward GPU-driven workloads. Storage capacity increased 28% QoQ to 869 TB, a 253% YoY rise, while usage fell 4% QoQ to 37 TB but remained 62% higher YoY. This suggests users prioritized compute-intensive tasks over storage-heavy applications. RAM usage grew 27% QoQ to 14 TB, a 214% YoY increase, with capacity expanding 38% QoQ to 117 TB, a 287% YoY rise, reflecting the growing complexity and memory demands of deployed workloads. Overall, the data highlights a shift in resource usage patterns, with GPUs and RAM seeing the strongest growth. These trends reflect Akash’s ability to adapt to evolving user demands while continuing to expand its infrastructure for high-performance computing. GPU Compute In Q4 2024, Akash’s GPU capacity reached 577 units, marking a 269% YoY increase and a 37% QoQ growth from 420 units in Q3. GPU usage grew even more sharply, increasing 428% YoY to 363 units, with a 42% QoQ rise from 255 units in Q3. These metrics highlight Akash’s continued efforts to scale GPU availability and meet the growing demand for decentralized compute power, particularly for AI and machine learning workloads. The growth in GPU capacity was driven by the Provider Incentives Pilot 2 program, initiated earlier in 2024 with a $5 million allocation approved by the Akash community to incentivize GPU providers. This program played a key role in expanding GPU capacity from 470 units in Q3 to 577 units in Q4, enabling Akash to support increasingly resource-intensive AI deployments. Active Providers Akash’s permissionless network allows resource providers to join from anywhere in the world, creating a geographically diverse and resilient infrastructure. This global distribution enhances the network’s ability to withstand regional disruptions, such as natural disasters, power outages, or political instability. It also improves performance by enabling tasks to be processed closer to end users, reducing latency and optimizing data transfer efficiency. In Q4 2024, the number of active providers on Akash’s network grew from 62 in Q3 to 67, reflecting an 11% QoQ increase and a 34% YoY growth. This steady expansion highlights the increasing appeal of Akash’s decentralized compute marketplace, driven by growing demand for resources, enhanced provider incentives, and the platform’s expanding infrastructure. A significant factor in this growth was the rise in revenue opportunities for providers. Akash achieved a record-breaking lease revenue of $742,000 in Q4, a 144% QoQ increase, signaling strong demand for computational resources. With a 274% QoQ increase in new leases and rising utilization of high-performance resources like GPUs (up 42% QoQ), providers recognized Akash as a thriving ecosystem offering substantial returns. The Provider Incentives Pilot 2 program further fueled network growth by incentivizing the onboarding of advanced GPUs, such as NVIDIA’s H100 and A100. This initiative enabled providers to meet increasing demand for compute-intensive workloads while making participation in the network more lucrative. By expanding the supply of high-performance resources, the program contributed to both the growth of active providers and the overall scalability of Akash’s network. Token Analysis Market Cap AKT's market capitalization rose 1% QoQ from $685M in Q3 2024 to $692M in Q4 2024 and grew 26% YoY from $549M in Q4 2023. The price of AKT increased 1% QoQ from $2.77 to $2.80 and 14% YoY from $2.46 to $2.80. The 26% YoY market cap growth, outpacing the 14% price increase, reflects a 2.5% rise in circulating supply, from 242M tokens in Q3 to 248M in Q4. This expansion is likely tied to staking rewards, token vesting, or emissions. Despite the higher supply, the consistent 1% QoQ increase in both market cap and price suggests that demand for AKT grew proportionally, maintaining price stability and demonstrating strong market fundamentals. Staking The value of staked AKT in USD decreased 10.6% QoQ, from $377M in Q3 2024 to $337M in Q4 2024. The total staked AKT also declined 11.0% QoQ, from 136M to 121M tokens, while the staking ratio dropped from 55% to 47% of the circulating supply, a 12% reduction. The AKT price remained stable at approximately $2.80 during this period, indicating that the decline in staked value was driven by reduced staking participation rather than price changes. The 11% reduction in staked AKT did not significantly impact staking yields, as a 2% increase in the network’s inflation rate maintained relatively stable rewards QoQ. The decline in staking participation may reflect changes in network incentives, adjustments to tokenomics, or strategic reallocation of assets by validators and delegators. These shifts suggest evolving sentiment among network participants, influenced by factors such as operational costs, yield dynamics, or broader market conditions. Qualitative Analysis Partnerships and Developments Integration with Witness Chain: Akash partnered with Witness Chain to improve the scalability and efficiency of decentralized validation for real-world attributes such as location, connectivity, and compute. Witness Chain employs an observation layer powered by protocols like Proof of Location (PoL), which uses cryptographic techniques to authenticate physical attributes with high accuracy. The integration with Akash enables Witness Chain to deploy its Watchtower nodes—key components in its validation process—on a distributed and cost-effective infrastructure. Akash’s dynamic scaling enables real-time adjustment of deployments based on demand, optimizing resource usage and performance. Additionally, Akash’s competitive pricing reduces operational costs, making large-scale deployment financially feasible. This collaboration enhances Witness Chain’s data validation process while allowing Akash to explore applications like Proof of Location (PoL) for verifying its network’s geographic distribution. Expansion in Latin America: Akash added three new compute providers in Latin America, including two in Buenos Aires and one in Bogotá. This expansion strengthens Akash’s global network and caters to the increasing demand for decentralized cloud services. Integration with Sentinel Scout: Akash Supercloud has partnered with Sentinel Scout, the first user-facing AI Data Layer platform in the Web3 ecosystem, to enhance decentralized AI applications. Sentinel Scout allows developers to access a network of decentralized data miners for tasks such as data retrieval, validation, and storage. By integrating Akash’s decentralized compute capabilities and Chat API, Sentinel Scout enhances its Intelligent URL Recommendation Engine, enabling efficient identification and retrieval of relevant data sources. The integration is pivotal for AI developers who rely on Sentinel Scout to streamline workflows in decentralized environments. Akash’s infrastructure also supports data cleaning and embedding processes, ensuring scalability and efficiency in managing data. Integration with Passage: Passage, a platform for hosting immersive virtual events, has integrated Akash Supercloud to reduce GPU compute costs while maintaining performance. The platform, which enables users to access virtual experiences via browser without downloads or hardware requirements, has historically relied on traditional cloud providers. By leveraging Akash’s decentralized GPU marketplace, Passage achieved average cost reductions of 50%, with savings reaching up to 70% in certain scenarios. During Cosmoverse, Passage demonstrated the practical implications of this integration by driving Akash’s GPU utilization to 85%. INTELLECT-1 AI Initiative: Prime Intellect, in partnership with Akash, HuggingFace, SemiAnalysis, and others, successfully trained INTELLECT-1, a 10-billion-parameter model, using decentralized compute resources. This effort represents the first decentralized training of a model at this scale. AkashGen Launch: Akash has introduced AkashGen, an open-source image-generation tool powered by NVIDIA GPUs on the Akash Supercloud. Currently, it runs Stable Diffusion 3.5 Large, a leading generative image model by StabilityAI, with plans to add more models in the future. Akash Console Beta: The Akash Console upgraded to support credit card payments, simplifying access to compute resources on the Akash Supercloud. Previously limited to AKT or USDC transactions via non-custodial wallets, the addition of fiat payments through Stripe addresses the needs of users unfamiliar with cryptocurrency. Part of the beta release, this update also includes free trials to enhance accessibility. While USDC remains a key payment method, accounting for 38% of transactions, the introduction of credit card payments offers greater flexibility for developers and enterprises preferring traditional payment options. Users can now fund accounts, manage deployments, and track spending directly within the console. Notable highlights Sponsorship of NVIDIA GTC 2025: Akash sponsored NVIDIA’s GPU Technology Conference, further establishing its presence in the AI and machine learning sectors. Recognition for Leadership: Akash CEO Greg Osuri was featured on CoinDesk's "Most Influential 2024" list for his contributions to decentralized computing. 2025 Roadmap Release: Akash unveiled its 2025 roadmap on January 14, 2025. Governance Core development on Akash is approved through token-weighted governance and goes through a structured proposal process. The community can also simply create tools that anyone can use to access Akash. Below are highlights from the Q4 2024 governance initiatives: Community Support Funding: The Q4 2024 Community Support Proposal allocated 21,902.45 AKT (approximately $72,000) to continue supporting critical community programs. This funding was directed towards the Insiders & Vanguards Program, which incentivizes volunteers to contribute actively to the ecosystem, and structured bounties, now increased to $10,000 per month (up from $5,000). The enhanced bounties aim to encourage greater participation and contributions across Akash’s projects, which are tracked transparently on a public board. This allocation is part of the annual community support budget of $228,000, designed to sustain long-term engagement and drive ecosystem growth. Events Resourcing Proposal: The Q4 2024 Events Resourcing Proposal allocated 309,547.68 AKT (approximately $690,291.33) to fund Akash’s participation in prominent industry events, including Cosmoverse, NeurIPS, Ray Summit, and DevCon 7. The budget breakdown includes $161,417.09 for Tier 1 sponsorships, $48,261.53 for Tier 2 engagements, and an adjustment of -$109,517 to address shortfalls from previous quarters caused by AKT price volatility and unforeseen costs. These events aim to enhance Akash’s visibility in the AI, blockchain, and cloud computing industries, facilitating networking opportunities, brand building, and strategic collaborations. MetaMask Integration Final Payment: This proposal finalized the payment of $30,000 worth of AKT tokens for the integration of MetaMask with Akash Network, completing all milestones outlined in the original proposal. Deliverables included the addition of multi-signature wallet support, in-wallet notifications, and the deployment of an alternative wallet UI hosted on Akash servers. This integration enables seamless access for MetaMask’s 30 million active users to Akash’s decentralized cloud computing services, while also bridging Cosmos and Ethereum ecosystems. The initiative aims to increase accessibility, drive adoption, and expand Akash’s marketplace reach to Ethereum-based users. Provider Incentives Pilot 2: The continuation of the Provider Incentives Program allocated $10 million USD (equivalent to approximately 5,966,667 AKT) to expand Akash’s GPU resources. The program builds on the success of the first pilot by engaging professional and community providers to supply high-quality GPU models, such as H100 and A100-80, to meet rising demand. Up to 10% of the budget is reserved for community providers that meet stringent requirements for reliability, quality, and compliance. A volatility buffer of 43.20% was incorporated to address fluctuations in AKT prices, ensuring the program’s stability. Transparent fund management and reporting are core aspects of this initiative, which aims to strengthen Akash’s capacity for AI and compute-intensive applications. Developer Onboarding Initiative (Zealy Phase 3): The Developer Onboarding Program allocated 6,500 AKT ($19,500) over three months to support the next phase of its incentive-driven campaign through Zealy. The program introduces a streamlined "user journey," guiding participants from onboarding to active contribution through missions like deploying on Akash, contributing to GitHub, and participating in bounties. This phase reduces costs by 10% compared to earlier campaigns while maintaining effectiveness in developer engagement. Managed by experienced community members, the program builds on earlier successes that saw a 400% increase in participant engagement, aiming to grow the Akash ecosystem by attracting and retaining active contributors. Akash Console 2.0 Payment Feature Development: This proposal allocated $313,126.55 (29% of the total project cost) to develop and implement new payment features for Akash Console 2.0, including Frictionless Free Trial and Fiat Payment options. These features aim to enhance the user experience by simplifying payment processes, reducing onboarding friction, and making Akash more accessible to new users. Overclock Labs continues to fund the majority of development costs, while the community contributes to accelerating these critical updates. The funds are managed transparently, ensuring accountability and minimizing potential market disruptions, with all milestones aligned to Akash’s broader ecosystem roadmap. Closing Summary In Q4 2024, Akash Network recorded $742,000 in revenue (+144% QoQ), with new leases increasing by 274% QoQ to 61,000. This growth was driven by increased adoption of GPU-based AI workloads, supported by an expansion in average daily GPU capacity to 577 units (+37% QoQ). The active provider count rose by 11% QoQ to 67, reflecting greater engagement from resource suppliers. Strategic updates included the beta release of Akash Console 2.0, enabling fiat payments and free trials to improve accessibility. Key partnerships with Sentinel Scout, Passage, and Witness Chain introduced new use cases such as AI workflows, virtual events, and data validation. The Provider Incentives Pilot 2 program allocated $10 million to scale GPU capacity, supporting high-performance workloads. Governance activities focused on community funding, developer incentives, and event sponsorships. The network also finalized the MetaMask integration, improving access for Ethereum-based users. Looking ahead, Akash aims to expand its decentralized compute capacity and infrastructure to meet increasing demand for AI and compute-intensive workloads.
Source: Armita — Published: 2025-02-04T14:00:00ZState of BNB Chain Q4 2024
Key Insights BNB’s market cap reached $101.09 billion in Q4’24, a 22% QoQ increase and a 114% YoY increase from $47.31 billion at the start of the year. Revenue for the year totaled $234.0 million, making BNB Smart Chain one of the top L1s by revenue. DeFi TVL grew 53% YoY to $5.35 billion by year-end, with a notable 10% QoQ increase in Q4. PancakeSwap and Venus Finance remained dominant, while ListaDAO emerged as a major player, driven by liquid staking solutions and innovative product launches. DEX volume surged throughout the year, with a 269% YoY increase in average daily volume. Q4 alone saw a 122% QoQ rise, reaching $1.29 billion in daily volume, driven by PancakeSwap’s dominance and contributions from new entrants like Uniswap. Technical advancements marked a transformative year for BNB Smart Chain. The BNB Beacon Chain sunset, widespread adoption of the Builder API Specification, and the implementation of BEP-341 enhanced network efficiency, security, and MEV. By year-end, 96% of blocks utilized the Builder API. Primer BNB Chain (BNB) is an ecosystem of blockchains where each chain serves a particular function. The three core components of BNB Chain are as follows: BNB Smart Chain (BSC): Smart contract layer and DeFi hub. Also is the staking and governance layer with the BNB Beacon Chain being discontinued. BNB Greenfield: Decentralized storage network. As a vital component of the One BNB paradigm, Greenfield focuses on live, valuable data and lets users create their own personal data marketplace. opBNB: High-performance optimistic rollup. opBNB is ideal for Dapps that require high transaction frequency, like fully onchain games. It offers the lowest gas fees among L2s, with transactions costing <$0.0001. It delivers very high performance, processing between 5,000 and 10,000 TPS. The metrics in this report will mostly focus on BNB Smart Chain (BSC). BSC is an EVM-compatible, Layer-1 blockchain secured by a form of Proof-of-Staked-Authority (PoSA) that combines aspects of Proof-of-Authority (PoA) and Delegated Proof-of-Stake (DPoS). In PoSA on BSC, the validator set is of fixed size and is elected by stake weight (staked plus bonded). In addition, validators must continue staking assets to secure the network, and validators chosen to produce blocks are rotated (not based on stake weight). For a full primer on the BNB Chain ecosystem, refer to our Ecosystem report. Website / X (Twitter) / Telegram Key Metrics Financial Overview Market Cap and Revenue Amongst the backdrop of a surging crypto market spurred on by the election of U.S. President Donald Trump, BNB set a new all-time high ($789 on Dec. 4) in Q4’24. At the end of the quarter, BNB’s market cap was $101.09 billion, up 22% QoQ. BNB’s market cap amongst all tokens (excluding stablecoins) fell by one to four overall due to XRP’s market cap rising substantially in Q4. As for the entire year, BNB’s market cap increased 114% YoY from $47.31 billion. Furthermore, BNB slightly underperformed BTC over this time period, as it increased 122% YoY from $832.94 billion to $1.852 trillion. Revenue, which measures all fees collected by the network, also experienced an upswing in Q4. In USD terms, revenue in Q4 was $44.6 million, up 28% QoQ from Q3’s revenue of $34.9 million. Revenue in BNB was also up, increasing 10% QoQ from 63,500 BNB to 69,500 BNB. In 2024, BNB’s revenue totaled $234.0 million, making it one of the top L1 blockchains by revenue. Gas fees paid on DeFi-related transactions have historically been the largest individual contributor to revenue. Q4 continued this trend, as the DeFi category contributed 8,900 BNB in gas fees (down 12% QoQ). Notably, however, DeFi’s share of revenue also decreased by 21% QoQ to 12.8%. Revenue related to wallet-to-wallet transactions was flat QoQ at 8,700 BNB. Its share of revenue was down 10% QoQ to 12.6%. The two categories with the biggest QoQ increases were infrastructure (up 19% QoQ to 1,000 BNB) and tokens (up 19% QoQ to 800 BNB). Their share of revenue in Q4 was 1.4% and 1.2%, respectively. The stablecoin (down 9% QoQ to 4,700 BNB) and MEV (down 23% QoQ to 1,700 BNB) categories both saw decreases in revenue for Q4. Supply Dynamics The initial total token supply for BNB was 200 million tokens (launched in July 2017). BNB is deflationary through a series of burning mechanisms: Auto-Burn: A mechanism that automatically burns varying amounts of BNB every quarter, depending on the token’s price and the number of blocks generated on BNB Chain during said quarter. Pioneer Burn: A program that counts all BNB accidentally lost by new or careless BNB Chain users as part of the quarterly burns. The project team reimburses users for accepted cases. Gas Fees Burn: In accordance with BEP-95, 10% of all gas fees incurred on BNB Smart Chain are burned automatically. The remaining 90% is rewarded to validators and stakers. By quarter end, the circulating supply of BNB was 144.0 million, giving BNB an annualized deflation rate of 5.3% (up 18% QoQ). Lastly, the 29th quarterly BNB burn occurred on November 1. 1.8 million BNB was burned, equivalent to $1.07 billion at the time of the burn transaction. Burned BNB came from the Auto-Burn mechanism and BTokens. Network Overview Onchain Activity Onchain activity rebounded on BNB Smart Chain in Q4, in part due to a rallying market. Average daily transactions trended higher in Q4, up 18% QoQ from 3.4 million to 4.0 million. Average daily active addresses also experienced an upward trend in Q4, increasing 8% QoQ from 868,300 to 868,300. Over the past year, both average daily transactions and average daily active addresses decreased, falling 12% YoY and 10% YoY, respectively. Broken down by category, stablecoins represented nearly half (45%) of all transactions on BNB Smart Chain for Q4, averaging 925,200 daily transactions, up 32% QoQ from 700,400. The second-highest category by daily transaction count was wallet-to-wallet transfers, which averaged 553,400 daily transactions (up 26% QoQ from 440,300. Combined, stablecoin transactions and wallet-to-wallet transactions represented 73% of all transactions in Q4. Other categories that saw notable QoQ increases in daily transaction counts were Tokens (up 15% QoQ to 87,600) and MEV (up 29% QoQ to 79,700). The only categories with QoQ declines were DeFi (down 24% QoQ to 299,300) and others (down 43% QoQ to 39,500. Similarly to transactions, stablecoins accounted for the most active addresses of any singular category on BNB Smart Chain in Q4. Stablecoins ended the quarter with an average of 376,000 daily active addresses (up 24% QoQ from 304,200). Half of all daily active addresses in Q4 interacted with stablecoins. The second largest category by active addresses was wallet-to-wallet transfers. Average daily active addresses for wallet-to-wallet transfers were up 10% QoQ to 209,800. The only other category with a QoQ increase was tokens, which was up 6% QoQ to 42,300. Security & Decentralization BNB Smart Chain utilizes a Proof-of-Staked Authority (PoSA) consensus mechanism in which 45 validator nodes are elected every 24 hours to participate in consensus. Their election is based on the total number of BNB tokens staked by/to each node. Of these 45 validators, the top 21 with the highest staked amounts are “Cabinets,” while the remaining 24 are “Candidates.” Then, 18 of the 21 “Cabinets” and 3 of the 18 “Candidates” are randomly selected to produce blocks for the given epoch. Selected validator nodes then take turns producing blocks based on Ethereum’s Clique consensus design. With BNB Chain’s Feynman Upgrade on April 18, the maximum amount of active validators on BNB Smart Chain increased from 40 to 45. Since the upgrade, there have been 45 active validators on BNB Smart Chain, signaling strong network security and a healthy appetite for operating validators on BNB Smart Chain. Total BNB staked decreased after three straight quarters of increases, in part due to the staking transitioning from BNB Beacon Chain to BNB Smart Chain. Total BNB staked decreased by 9% QoQ from 32.4 million to 29.6 million. However, since the price of BNB appreciated in Q4, the dollar amount of BNB staked increased by 14% QoQ from $18.3 billion to $20.8 billion. Compared to other PoS networks, BNB Smart Chain had the fourth-highest dollar value of funds staked by the end of 2024, dropping one spot behind Sui. As for the full year, BNB Smart Chain experienced significant growth in staking, in part due to the aforementioned transition of staking from BNB Beacon Chain to BNB Smart Chain. Total BNB staked increased 34% YoY from 22.1 million, while the dollar amount of BNB staked increased by 202% YoY from $6.9 billion. MEV BEP-322, a proposal for Proposer-Builder Separation (PBS) on BNB Smart Chain validators, went live last quarter in Q2. BEP-322 was implemented as a builder API specification to address the fragmentation of MEV (maximal extractable value) solutions on BSC. This specification creates a unified and open MEV market where block proposers (i.e., validators) do not play a role in selecting which transactions are included in the proposed block. Instead, block builders create possible blocks and submit them to the validator proposing a block. The validator then selects the proposed blocks that net them the most fees. This new mechanism brings stability and transparency to BNB Chain’s MEV market while also promoting healthy market competition for block builders. BNB Smart Chain’s Builder API Specification went live in May. In Q4, 96% of all blocks were built using the Builder API Specification, up 16% QoQ from 83% in Q3. Furthermore, as of writing, there are 35 different block builders on BNB Smart Chain. Network Capacity Optimization One initiative in Q4 was improving BNB Smart Chain’s capacity and throughput. On November 7, BEP-341 was implemented on BNB Smart Chain. BEP-341 introduces a mechanism on BNB Smart Chain allowing the same validator to produce up to four consecutive blocks. Prior, a validator could only propose one block at a time. Additionally, BNB Smart Chain aims to implement BEP-396 in 2025, which introduces a txDAG hint-based parallel EVM. This is designed to enhance blockchain performance by structuring transaction processing based on dependencies, allowing non-conflicting transactions to execute in parallel. This approach reduces the need for costly re-executions, thereby increasing throughput and optimizing resource utilization on networks like BNB Chain. BNB Beacon Chain Sunset In Q2, BNB Beacon Chain began the process of being sunset. While BNB Beacon Chain was used as BNB Chain’s staking and governance layer, it introduced complexity and some security vulnerabilities due to the bridging between BSC and BNB Beacon Chain. For this reason, BNB Chain began migrating BNB Beacon Chain functionality to BNB Smart Chain. In Q4, BEP-333: Chain Fusion was finally implemented across four different upgrades: BNB Beacon Chain First Sunset Fork (Implemented on April 15) - Disabled cryptocurrency issuance and minting features on BNB Beacon Chain. BNB Smart Chain Feynman Hard Fork (Implemented on April 18) - Enabled validator creation and governance functionality on BNB Smart Chain. BNB Beacon Chain Second Sunset Fork (Implemented on July 14) - Disabled governance and delegation capabilities on BNB Beacon Chain. BNB Beacon Chain Final Sunset Fork (Implemented on December 3) - Halted BNB Beacon Chain and disabled cross-chain communication to BNB Smart Chain. Ecosystem Overview DeFi BNB Smart Chain DeFi TVL denominated in USD, increased from $4.85 billion in Q3 to $5.35 billion, a 10% QoQ increase. This ranked BNB Smart Chain as the fifth-highest chain by TVL denominated in USD by the end of the quarter, falling one spot after being surpassed by Bitcoin in December. For 2024, TVL denominated in USD increased 53% YoY from $3.5 billion. TVL denominated in BNB was down in Q4, decreasing 8% QoQ from 8.3 million BNB to 7.6 billion. This dynamic indicates that part of the TVL increase in USD was driven by the price appreciation of BNB. The top two protocols by TVL on BNB Smart Chain are PancakeSwap and Venus Finance. Pancakeswap, the largest protocol by TVL, increased 7% QoQ from $1.64 billion to $1.76 billion, surpassing Venus Finance. PancakeSwap consists of three different AMMs (PancakeSwap AMM, StableSwap, and AMM V3). By the end of Q4, AMM TVL was $1.34 billion (76% of TVL), StableSwap TVL was $24.7 million (1% of TVL), and AMM V3 TVL was $376.0 million (21% of TVL). However, despite the increase in TVL, PancakeSwap’s TVL dominance decreased to 33% (down 6% QoQ from 35%). Venus Finance, the second largest protocol by TVL, decreased 5% QoQ from $1.79 billion to $1.70 billion. Notably, despite the decrease in TVL, borrows increased from $454 million in Q3 to $857 million in Q4, an 89% QoQ increase. By the end of Q4, Venus Finance’s TVL dominance was 32% (down 17% QoQ from 38%). The biggest gainer in QoQ terms within the top six was ListaDAO, a CDP stablecoin lending and liquid staking protocol. Its TVL increased 174% QoQ from $198.4 million to $544.5 million. New product launches in Q4, such as External LP Emissions and Bribe Markets, helped catapult ListaDAO into the top three protocols by TVL on BNB Smart Chain. Additionally, ListaDAO was a large beneficiary of BNB Smart Chain’s efforts in 2024 to simplify staking. Avalon Labs, PinkSale, and Aave round out the top six, which all experienced TVL gains in Q4. Avalon Labs, a lending protocol for BTC-based assets on multiple networks, increased its TVL by 86% QoQ from $159.4 million to $296.3 million. BTCFi became a top priority for BNB Smart Chain in the latter half of 2024, which helped drive Avalon Labs’ success. Additionally, since the majority of Avalon Labs’ TVL is denominated in BTC, BTC’s Q4 price rally also helped boost TVL. PinkSale, a token launchpad protocol, had a TVL increase of 8% QoQ from $179.2 million to $193.9 million. Rounding out the top six was the popular lending protocol Aave. Aave’s TVL increased 82% QoQ from $64.3 million to $116.9 million. Aave overtook UNCX Network for the final spot in the top six in Q4. In Q4’23, BNB Smart Chain introduced the TVL Incentive Program. The program aims to reward projects deployed within the ecosystem that attract significant amounts of TVL. In Q4, Phase 4 ended, running from September 12 to October 19. Phase 4 was a two-part program featuring prize pools for two categories: Liquid Staking and DeFi. In total, $100,000 was rewarded to three projects: ListaDAO - $50,000 Venus Finance - $30,000 PancakeSwap - $20,000 With the migration of validation and staking services to BNB Smart Chain this past year, liquid staking has become a top priority for the BNB Chain ecosystem. Concurrently, ListaDAO’s liquid staking solution, slisBNB, has emerged as the dominant liquid staking solution on BNB Smart Chain. By the end of Q4, 766,000 BNB ($539.6 million) was deposited in liquid staking solutions. Compared to last quarter, the amount of liquid staked BNB was up 79% QoQ from 428,700. Furthermore, ListaDAO’s slisBNB represented 97% of all liquid staked BNB (748,300). After a lull during the summer months of 2024, DEX volumes saw a resurgence across most smart contract platforms in Q4. BNB Smart Chain was a beneficiary of this trend as the average daily DEX volume increased by 122% QoQ from $578.1 million to $1.29 billion. BNB Smart Chain had the fourth most DEX volumes of any chain in Q4 ($117.57 billion). Only Solana ($305.56 billion), Ethereum ($204.27 billion), and Base ($128.69 billion) had more DEX volume. For the entire year, the average daily DEX volume on BNB Smart Chain increased 269% YoY. In Q4’23, the average daily DEX volume was $348.8 million. By the end of Q4, there were 71 different DEXs (up 2 QoQ) on BNB Smart Chain. Despite the high level of competition, PancakeSwap has historically been the most dominant DEX on BNB Smart Chain. In Q4, PancakeSwap’s average daily DEX volume was $1.09 billion, up 126% QoQ from $479.9 million. PancakeSwap’s dominance increased by 2% QoQ from 83% to 84%. The biggest gainer in average daily volume for Q4 was Swaap. Its average daily volume increased 4,656% QoQ to $2.3 million, making it the sixth largest DEX on BNB Smart Chain by volume. For Q4, the top six DEXs by average daily trading volume were: PancakeSwap ($1.09 billion - 84% of BNB Smart Chain DEX volume) THENA ($79.3 million - 6% of BNB Smart Chain DEX volume) Uniswap ($63.2 million - 5% of BNB Smart Chain DEX volume) DODO ($38.5 million - 3% of BNB Smart Chain DEX volume) WOOFi ($2.6 million - <1% of BNB Smart Chain DEX volume) Swaap ($2.3 million - <1% of BNB Smart Chain DEX volume) Stablecoins & BTC Stablecoins on BNB Smart Chain achieved noticeable growth in 2024. For Q4, the stablecoin market cap increased 37% QoQ from $5.00 billion to $6.84 billion. For the entire year, the stablecoin market cap increased 50% YoY from $4.55 billion. By the end of 2024, BNB Smart Chain had the third-highest stablecoin market cap, only behind Ethereum ($111.24 billion) and TRON ($58.54 billion). USDT, the largest stablecoin on BNB Smart Chain, saw its market cap increase from $3.98 billion to $5.17 billion. By the end of Q4, USDT represented 76% of the stablecoin market on BNB Smart Chain (down 5% QoQ from 79%). USDT’s loss in market share was a result of new stablecoins like USDX and lisUSD. USDX, a synthetic USD stablecoin backed by delta-neutral positions, launched in October and quickly became a top stablecoin on BNB Smart Chain, reaching a market cap of $438.8 million by quarter end. lisUSD is ListaDAO’s collateral debt position backed stablecoin. It saw significant growth in Q4, increasing 108% QoQ to $74.4 million. At the end of Q3, BNB Smart Chain launched the “Gas-Free Carnival,” an initiative to increase stablecoin adoption on the platform. The Gas-Free Carnival allows users to transfer stablecoins with no gas fees, offering several options for seamless transactions: Gas-Free Stablecoin Transfers: Users can send USDT, USDC, and FDUSD across BNB Smart Chain and opBNB with no gas fees, supported by Bitget Wallet and SafePal. 0-Fee Withdrawals: Participating exchanges like Binance, Bitget, Gate.io, and SafePal offer fee-free withdrawals of these stablecoins to BNB Smart Chain. Free Bridging via Celer cBridge: Celer cBridge allows users to bridge supported stablecoins to BNB Smart Chain or opBNB networks without cost. The Gas-Free Carnival lasts until March 31, 2025. BTCB is one of the largest assets by market cap on the BNB Smart Chain, outside of BNB and stablecoins. It is a tokenized version of Bitcoin on the BNB Smart Chain. The supply of BTCB in Q4 was flat QoQ 65,300, equivalent to $6.13 billion. As for BTCB holders, they increased by 5% QoQ to just slightly over 1 million. BNB Smart Chain has been bolstered by its emergent BTCFi ecosystem. Projects like Solv Finance, Lorenzo, Lombard Finance, and more offer BTCB holders on BNB Smart Chain the opportunity to participate in various DeFi opportunities. opBNB opBNB is an EVM-compatible optimistic rollup that helps scale execution throughput for BNB Smart Chain. Since launching in the middle of Q3’23, total value bridged (TVB) has been in a consistent uptrend. In Q4, TVB to opBNB increased 10% QoQ from $78.9 million to $86.5 million. USDT (up 1% QoQ to $52.8 million) remains the most popular bridged token on opBNB, representing 61% of all TVB. In percentage terms, BNB was the biggest gainer in Q4, increasing 30% QoQ to $30.4 million. NFTs NFT activity slumped for the majority of Q4. As a result, the average daily NFT trading volume in Q4 decreased 27% QoQ from $600,400 to $441,200. Average daily sales also saw a decrease, down 87% QoQ from 8,900 to 1,200. However, on December 12, MagicEden, one of the most popular NFT exchanges, added support for BNB Smart Chain. From December 12 to December 31, the average daily NFT trading volume was $518,700. The added support of MagicEden should bolster NFT activity on BNB Smart Chain in 2025. Ecosystem Growth BNB Chain continues to support new projects within its ecosystem through its Most Valuable Builder (MVB) Accelerator Program. In October, BNB announced the results of the eighth season of MVB. There were over 500 applications, and thirty-five different projects were chosen as a part of the Season 8 cohort. Projects ranged across DeFi, infrastructure, and applications, and winning projects can be found here. Season 9 of MVB was also announced in December. Season 9 of the BNB Chain MVB program offers a focused four-week acceleration for early-stage Web3 projects building within the AI Crypto sector, with continued collaboration between YZi Labs, CMC Labs, and BNB Chain. Outside of the MVB Accelerator Program, BNB Chain hosted a hackathon in Q4. Application submissions were open from December 15 to January 1, and over 200 different applications were submitted. The total prize pool consisted of $458,000, and the winners of the hackathon were announced on January 24: First place ($15,000) - PayNova Second Place ($10,000 each) - Outrun and AgentArcade Third Place ($5,000 each) - RhythmMural, StarBridge, and DoubtEarn A list of all other projects that qualified for prize money can be found here. BNB Chain also launched a series of community and ecosystem initiatives in Q4: BNB Incubation Alliance (BIA) in Dubai (October 10) - BNB Incubation Alliance, an incubator program for early-stage ecosystem projects seeking BNB grants and investments from Binance Labs, hosted an event at Binance Blockchain Week in Dubai. The winner of the event was Multipli, a ZK-based multichain yield protocol. Meme Innovation #4 (October 17) - The fourth round of Meme Innovation offered a $200,000 prize pool and up to $100,000 in liquidity provider (LP) support to strengthen the BNB Smart Chain memecoin ecosystem. The program focused on fostering creativity, launching new meme coins, and enhancing liquidity for existing projects. Participants also gained tailored marketing opportunities and access to resources to scale and grow within the BNB Smart Chain community. BNB Incubation Alliance (BIA) in Bangkok (November 5) - The fifth BNB Incubation Alliance, held during DevCon in Bangkok, celebrated three winning projects: XPIN Network, a decentralized wireless platform enabling global 4G/5G access; Oneverse, a full-stack solution provider revolutionizing digital content through localized Web3 integrations; and Pieverse, a decentralized platform bridging Web3 and real-world commerce through direct community and merchant connections. One-Stop Tokenization Solution (November 6) - BNB Smart Chain launched its One-Stop Tokenization Solution, which enables businesses to tokenize assets like loyalty points, NFTs, and financial instruments. The solution simplified asset creation and management, supporting scalability and integration with blockchain ecosystems. NFT Loyalty Program (November 21) - BNB Smart Chain unveiled its NFT Loyalty Program, which enables brands to implement NFT-based loyalty programs, offering scalable tools to reward customers with blockchain assets. These programs enhance engagement and retention through tokenized incentives such as exclusive access, discounts, and rewards, bridging traditional and blockchain-based customer experiences. BNB Chain as an AI-First Blockchain (December 27) - BNB Smart Chain outlined its evolving AI ecosystem, showcasing its role in driving innovation within Web3. The initiative provides AI-powered tools and infrastructure to support developers, enabling the creation of smarter dApps and services. Key applications include integrating AI into DeFi platforms, NFT ecosystems, and decentralized applications, opening new possibilities for personalized user experiences and data-driven solutions. Closing Summary 2024 was a transformative year for BNB Smart Chain, marked by significant progress in onchain activity, ecosystem growth, and more. BNB reached a new all-time high of $789 in Q4, closing the year with a market cap of $101.09 billion, a 114% YoY increase. Revenue for the year totaled $234.0 million, reflecting strong network activity and adoption. Onchain activity showed resilience in Q4 despite YoY declines, with Q4 bringing a resurgence in transactions and active addresses. DeFi TVL grew 53% YoY to $5.35 billion, driven by established protocols like PancakeSwap and Venus Finance and emerging players like ListaDAO. Liquid staking became a key focus, with ListaDAO capturing 97% of liquid-staked BNB by year-end. Ecosystem initiatives throughout the year, including the TVL Incentive Program and MVB Accelerator, spurred innovation and engagement. DEX volumes surged, with PancakeSwap maintaining dominance and THENA and Uniswap emerging as notable contributors. The BNB Beacon Chain sunset and adoption of the Builder API Specification capped a year of technical advancements, enhancing efficiency, security, and MEV market transparency. With sustained financial growth, ecosystem expansion, and technical innovation, BNB Smart Chain is well-positioned to maintain its momentum into 2025.
Source: AJC — Published: 2025-02-04T12:55:37ZState of Mantle Q4 2024
Key Insights Mantle's Total Value Locked (TVL) grew by ~35.82% QoQ and ~354.19% YoY, driven by DeFi integrations and heightened ecosystem activity. The mETH Protocol solidified its position as the fourth-largest Ethereum liquid staking token, reaching a peak TVL of ~$2.19 billion within its first year. Mantle’s treasury value increased by ~54.00% in Q4, rising from ~$3.00 billion in Q3 to ~$4.62 billion, largely driven by MNT token price appreciation in Q4. Notably, MNT comprised ~88.85% of the treasury’s value at the end of 2024. The Mantle Rewards Station remained crucial in Q4, while new programs like the COOK Feast offered holders the chance to earn a share of 200 cmETH tokens. Mantle Network integrated key technologies like ERC-7683 and Chainlink CCIP to enhance cross-chain interoperability, cementing a role in DeFi innovation. Primer Mantle is focused on building a sustainable hub for onchain finance by combining institutional-grade infrastructure with blockchain technology. At the heart of Mantle is its community-owned treasury, which, with ~$4.00 billion in assets, actively funds innovative products and fosters the growth of ecosystem partners. Mantle drives financial utility and liquidity through core offerings like Mantle Network, mETH Protocol, and Ignition FBTC, enabling the development of solutions that enhance sustainable yield, deep liquidity, and composability across DeFi. Mantle Network (MNT) is a Layer-2 (L2) scaling solution for Ethereum built using OP Stack Bedrock. The EVM-compatible network employs an optimistic rollup mechanism to batch multiple transactions into a single transaction on the Ethereum mainnet (Layer-1). Mantle Network aims to offer lower gas fees, reduced latency, and higher throughput than Ethereum. The project’s ecosystem primarily consists of restaking, gaming, DeFi, and NFT-related protocols, which are anchored by its large community-owned treasury. Mantle’s treasury is a major catalyst for asset partner growth, paving the way for protocols such as Ethena USDe, Ondo USDY, Agora AUSD, and EigenLayer restaking to provide enhanced yield options and liquidity solutions. Mantle Network aims to be the "Liquidity Chain" to drive capital efficiency in the onchain economy through modular architecture, data availability solutions, and zero-knowledge proofs. Mantle’s other core product offerings include: mETH Protocol: Mantle’s liquid staking and restaking protocol for ETH opens up new possibilities for users to maximize asset potential. Ignition FBTC: A decentralized Bitcoin solution that combines Bitcoin's security with the composability of DeFi. It bridges BTC into the Web3 economy and unlocks new financial opportunities. Upcoming product offerings include the Mantle Enhanced Index Fund, Mantle Banking, and MantleX. Website / X (Twitter) / Discord Key Metrics Financial Overview Market Cap and Price In Q4 2024, Mantle Network’s native token, MNT, grew to a market cap of ~$4.21 billion, experiencing an increase of ~106.67% QoQ (from ~$2.04 billion to ~$4.21 billion) or ~109.05% YoY (from ~$2.02 billion to ~$4.21 billion). Similarly, MNT’s price showed positive price action, increasing ~100.53% QoQ (from ~$0.62 to ~$1.25) or ~94.56% YoY (from ~$0.64 to ~$1.25). This market cap and token price appreciation was largely catalyzed by the successful launch of the cmETH token, increased adoption of the mETH Protocol, and the implementation of Mantle’s enhanced staking and governance mechanisms. Additionally, the integration of innovative DeFi solutions and growing user engagement across the ecosystem further amplified investor confidence. Total Value Locked (TVL) Mantle Network's TVL demonstrated significant growth during Q4 2024. Between Nov. 7, 2024, and Dec. 4, 2024, Mantle’s TVL increased from ~$1.69 billion to ~$2.16 billion, representing a ~27.81% QoQ increase. This growth reflects an expanding user base and heightened activity throughout the ecosystem, specifically within the network's DeFi sector through key products such as mETH Protocol and the cmETH token. mETH Protocol emerged as the fourth-largest Ethereum liquid staking token within its first year, reaching a peak TVL of ~$2.19 billion. Incubated by Mantle’s team, the protocol was deployed on Ethereum while remaining governed by Mantle. This governance model facilitated seamless integration with the broader Ethereum ecosystem, leveraging Mantle's governance structure. Breaking down DeFi TVL growth by protocol, Mantle Network’s performance in Q4 showcased significant contributions from various DeFi platforms within its ecosystem. Notable protocols set the trend with TVL increases, such as Pendle (up ~280.21% QoQ, from ~$36.41 million in Q3 to ~$138.43 million in Q4), Merchant Moe (up ~35.67% QoQ, from ~$90.84 million in Q3 to ~$123.24 million in Q4), and AGNI (up ~6.20% QoQ, from ~$98.53 million in Q3 to ~$104.64 million in Q4). Each protocol contributed unique functionalities, ranging from liquid staking solutions to yield optimization tools, that collectively strengthened Mantle’s ecosystem. As of Dec. 31, 2024, Mantle Network recorded a cumulative DeFi TVL of ~$731.06 million, a ~35.82% increase QoQ (from ~$538.26 million to ~$731.06 million), or a ~354.19% increase YoY (from ~$160.96 million to ~$731.06 million). Network Overview Treasury Value and Holdings Quarter-over-quarter, Mantle’s total treasury holdings increased 52.56%, from $2.57 billion in Q3 to $3.93 billion in Q4. Mantle's treasury in Q4 was largely dominated by MNT, which constituted ~88.85% of the total holdings (~$3.49 billion). The second and third-largest positions were mETH and WETH at ~4.43% (~$174.03 million) and ~2.65% (~$103.82 million), respectively. Further allocations included "Other" assets (~2.17%, ~$85.17 million), USDE (~1.15%, ~$45.09 million), and the addition of COOK to Mantle’s treasury in Q4 (~0.76%, ~$29.65 million). This composition highlights Mantle’s dependence on its native token, MNT, as the core of its treasury, complemented by allocations to mETH, wETH, and “Other” assets (including USDC, USDY, and APEX) to ensure liquidity and ecosystem growth. A further breakdown of token holdings is provided below: MNT Holdings: Increased by ~83.35% QoQ (from $1.90 billion to ~$3.49 billion) mETH Holdings: Decreased by ~67.07% QoQ (from $528.51 million to ~$174.03 million) wETH Holdings: Increased by ~67.37% QoQ (from $62.03 million to ~$103.82 million) “Other” Holdings: Increased by ~148.73% QoQ (from $34.24 million to ~$85.17 million) USDE Holdings: Increased by ~95.85% QoQ (from $23.02 million to ~$45.09 million) COOK Holdings: QoQ change N/A; allocated a total of ~$29.65 million, beginning in Q4. As of Dec. 31, 2024, Mantle’s treasury ranked the third largest across blockchain networks, according to DeFiLlama, showcasing its strong financial position and ability to support long-term ecosystem initiatives. Technology Advancements Mantle Network introduced several updates throughout Q4 to enhance its network, integrate DeFi innovations, and improve technological capabilities. ERC-7683 Support and CCIP Integration Mantle Network announced support for the ERC-7683 standard on Nov. 7, 2024. This cross-chain messaging standard addresses liquidity fragmentation across blockchain networks by enabling intent-based systems. Integrating ERC-7683 with Mantle Network’s Chain Abstraction (ChA)%20design) mechanism simplifies cross-chain interactions and liquidity management, positioning the network to offer a more cohesive user experience. In addition, Mantle Network integrated Chainlink’s Cross-Chain Interoperability Protocol (CCIP) on Dec. 3, 2024, to further enhance its cross-chain functionality. This integration is underpinned by Chainlink’s decentralized oracle networks, offering Mantle an infrastructure for secure data and asset transfers. CCIP enables programmable token transfers and arbitrary messaging, facilitating multi-step transactions across blockchain ecosystems. The protocol’s extendable design ensures compatibility with future advancements, reducing switching costs as cross-chain technology evolves. These enhancements position Mantle Network to support innovative applications and improve interoperability across the DeFi landscape. OP Succinct Implementation On Dec. 19, 2024, Mantle Network introduced OP Succinct, an L2 scaling solution that combines Succinct’s zkVM with the modularity of the OP Stack. As a result, Mantle transitioned from optimistic rollups to ZK rollups. This transition reduced withdrawal finality to one hour, improving efficiency and reliability while maintaining compatibility with EVM tools. Implementing OP Succinct addresses common challenges faced by many L2s, including scalability and transaction finality. Adopting Succinct Processor 1 (SP1) modular architecture strengthens Mantle Network’s alignment with Ethereum’s security standards and provides infrastructure improvements that support faster transaction confirmations and enhanced security. Security Enhancements The integration of Safe{Core} and Safe{Wallet} multi-signature solutions on Oct. 9, 2024, introduced advanced asset management tools, allowing users to secure high-value transactions with multiple authorization layers. To mitigate risks, Mantle issued warnings about phishing attempts and impersonation accounts targeting its community, highlighting a proactive approach to user protection. Mantle also collaborated with BlockSec to enhance protocol-level security and launched cmETH, further ensuring the integrity of core protocols and user assets while providing a secure and reliable environment for its users and developers. Ecosystem Overview Community Events, Campaigns, and Incentive Programs Throughout Q4, Mantle continued to organize community events and campaigns designed to boost engagement, educate users, and foster a sense of community within the ecosystem. On Oct. 1, 2024, the first wave of Bybit’s WSOT DEX Wave competition was launched. The event was positioned as a "Web3 talent show" and the "world's first Web3 Idol" on Mantle Network. This event showcased ~100 Web3 projects across ~30 blockchain platforms, offering participants a chance to compete for a 1 million MNT prize pool. Public voting, a core element of the competition, allowed users to contribute voting points to up to three projects daily. On Oct. 11, 2024, Mantle Network launched the final season of the Mantle AI Fest: CH(AI)N REACTION, in collaboration with FIDE AI and Layer3. Participants engaged in a series of quests to claim a share of the 100,000 MNT and 10 million FIDE token prize pool. The event featured two quest types: (i) One-Time Tasks, offering a 50,000 MNT reward for activities such as following Mantle and FIDE AI on social media, and (ii) Recurring Challenge Tasks, distributing 50,000 MNT and 10 million FIDE to top performers in the Range FIDE(r) volatility game. The volatility competition encouraged players to predict asset price boundaries while completing offchain social tasks. Concluding on Oct. 25, 2024, the event drove ~2 million processed transactions and ~180,000 active users. On Nov. 26, 2024, Mantle Network introduced the Mantle DeFi Fest, a month-long initiative to enhance community engagement and showcase its expanding DeFi ecosystem. The event, which concluded on Dec. 24, 2024, offered a 1 million MNT prize pool split between a lottery (400,000 MNT) and Layer3 Quests (600,000 MNT). It commenced with a Community Vote, allowing users to select eight standout DeFi protocols to advance. The second phase, Layer3 Quests, encouraged users to interact with chosen protocols through various DeFi activities. A bonus pool of 320,000 MNT was also available for users engaging with unselected protocols. On Dec. 6, 2024, Mantle Network partnered with Ethena Labs to distribute 4 million ENA tokens through the Mantle Rewards Station. This three-month campaign, running from Dec. 6, 2024, to March 6, 2025, incentivizes users to lock MNT tokens in exchange for ENA rewards, strengthening relationships between different tokens within the ecosystem. Five days later, on Dec. 11, 2024, Mantle Network announced the addition of EIGEN to the Mantle Rewards Station. This offering, available until March 11, 2025, allows users to allocate locked MNT tokens in an active pool to earn EIGEN. The Mantle Rewards Station encourages longer lock-in periods by offering a fixed lock-in multiplier, ranging from 1x for 0 days locked to 3x for 300 days locked. Lastly, the network introduced time-limited programs in Q4, such as the MNT Rewards Booster (offered as an event by the Mantle Rewards Station) and an extended phase of the Yield Lab. These initiatives aimed to boost participation during the holiday season, driving engagement with Mantle Network’s DeFi offerings. Educational Initiatives Along with community events and campaigns, Mantle reinforced engagement through educational programs in Q4. On Oct. 9, 2024, the MNT Buildathon, a global online early-stage builder program backed by Mantle, offered two avenues for community innovation. The ConInfra%3A%20Build%20the%20infrastructure%20or%20middleware%20that%20powers%20the%20next%20generation%20of%20consumer%20apps.%20Think%20of%20it%20as%20the%20nutty%20magic%20behind%20the%20scenes%20%E2%80%94%20social%20infrastructure%20protocols%2C%20social%20graphs%2C%20and%20AIGC/LLMs/AI%20Verification%20are%20great%20examples.) (Consumer-Infrastructure) pathway allowed users to build the foundation for consumer applications, while the ConCon%3A%20Build%20front%2Dfacing%20applications%20that%20your%20friends%20can%20easily%20get%20started%20without%20all%20the%20hassle!%20Whether%20it%27s%20social%20apps%2C%20games%2C%20or%20health%20and%20accountability%20tools%2C%20this%20track%20focuses%20on%20creating%20user%2Dfriendly%20experiences%20that%20make%20onboarding%20smooth%20as%20peanut%20butter.) (Consumer-Consumer) track streamlined front-end user development of decentralized applications. The Buildathon featured $150,000 in prizes, mentorship opportunities, and access to developer tools. Additionally, Mantle Network introduced "Deep Dives" sessions on Mantle’s Discord server with various partners. These included discussions with Web3 entities such as Community Gaming (Oct. 23, 2024), and Demexchange (Nov. 27, 2024). These sessions provided insights into different aspects of the Mantle ecosystem, aiming to help users make informed decisions about their participation. Methamorphosis Season 2 On Oct. 30, 2024, mETH Protocol launched Methamorphosis Season 2, the second phase of its multi-protocol incentive program designed to boost engagement with the mETH and cmETH tokens across various DeFi protocols on Mantle Network. Methamorphosis Season 2 is built upon the foundation of Season 1, with a greater emphasis on restaking and expanding ecosystem integration. While Season 1 enabled mETH holders to secure their share of COOK, mETH Protocol's governance token, Season 2 shifts focus to cmETH. The season includes 30 participating protocols, such as FusionX, iZUMi Finance, and TheTanuts Finance, and integrated infrastructure partners like IntoTheBlock and Veda to streamline yield opportunities. Powder rewards were restructured to offer 10-40 Powder per day for various activities, with cmETH incentivized liquidity pools offering up to 40 Powder daily. Season 2 amplifies the adoption of cmETH, allowing holders to earn multiple yields via (i) ETH Proof-of-Stake validation, (ii) restaking protocols, and (iii) L2 decentralized applications. This refined structure reflects Mantle’s growing focus on its L2 ecosystem through its product line and highlights its strategy to enhance engagement and liquidity. Season 2 is set to conclude on Feb. 16, 2025. Mantle Rewards Station and COOK Feast The Mantle Rewards Station played a central role in distributing ecosystem rewards in Q4. By Nov. 7 2024, the platform had distributed ~2.50 billion mShards (~4.30 million ENA) and 200.00 million COOK tokens, among other incentives, to MNT token lockers. The COOK Feast program, running from Nov. 21, 2024, to Feb. 16, 2025, offers COOK tokenholders the opportunity to earn a share of a 200 cmETH reward pool by locking their tokens and generating COOK Power. In December, the Mantle Rewards Station also introduced new initiatives to expand engagement. On Dec. 6, 2024, Mantle worked with Ethena Labs to launch a three-month campaign allocating 4 million ENA tokens to users locking MNT. Five days later, on Dec. 11, 2024, EIGEN was added to the Rewards Station, enabling users to earn additional rewards by locking MNT tokens in an active pool. Both initiatives encourage longer lock-in durations through a fixed multiplier system, ranging from 1x for no lock-in to 3x for 300 days locked. Gaming and Social Integration Mantle Network broadened its ecosystem by integrating elements of gaming and NFTs throughout Q4. The gaming ecosystem experienced new partnerships in October, including collaborations with Aria, a scalable role-playing game that utilizes Web3 technology, and Blade of God X, a cross-platform action-role-playing game. In the NFT space, the network launched "The Next Phase" event, running from Oct. 31, 2024, to Nov. 14, 2024. Over 9,000 wallets minted NFTs during this period, demonstrating growing user interest in Mantle Network’s NFT initiatives. Additionally, Mantle Network introduced gaming-centric projects like Ember Sword, which integrated player feedback to enhance gameplay. Ignition FBTC and Updates to Mantle’s Bitcoin Ecosystem In Q4 2024, Mantle made great progress in its Bitcoin ecosystem through Ignition FBTC, a decentralized Bitcoin solution that combines Bitcoin's security with the composability of DeFi. By Nov. 19, 2024, Ignition FBTC reached a milestone of $1 billion in total value locked (TVL), demonstrating strong adoption across five chains, and integration with over 40 DeFi protocols. Mantle also partnered with Chainlink to implement Price Feeds and Proof of Reserve Secure Mint. These offerings enhanced FBTC’s reliability and security by providing tamper-proof price data and ensuring the minting process remains transparent and trustless. FBTC collateral is validated in real-time, reducing risks associated with token minting. Additionally, on Dec. 18, 2024, Mantle announced the deployment of Compound III on its platform. The deployment integrates Ethena Labs’ USDe as the base asset, with FBTC featured as a collateral option alongside mETH and WBTC. Closing Summary Q4 2024 marked a period of robust growth and strategic advancements for Mantle. Significant increases in TVL and treasury holdings underscored the network’s financial strength and expanding ecosystem. With innovative products like the mETH Protocol and cmETH driving adoption, Mantle Network reinforced its leadership in Ethereum staking solutions. Technological upgrades, including ERC-7683 and Chainlink CCIP, further enhanced interoperability and user experience across its ecosystem. Community-driven initiatives, such as the Mantle Rewards Station and Methamorphosis Season 2, demonstrated Mantle’s commitment to fostering engagement and incentivizing participation. Positioned as a major player in DeFi, Mantle enters 2025 with strong momentum for sustained growth and ecosystem development.
Source: Evan Zakhary — Published: 2025-01-31T17:30:30ZState of Tezos Q4 2024
Key Insights Tezos Layer 1 experienced a 30.4% increase in revenue from transaction fees QoQ (90.8% in USD terms). Etherlink experienced a 184% surge, with over 1,700 new contracts deployed. Tezos saw an 18% rise in contract deployments, totaling over 5,800 new contracts. Daily active addresses (DAA) on Tezos Layer 1 grew by 37% QoQ, averaging 1,800 unique addresses per day The Quebec protocol upgrade progressed through governance phases, aiming to reduce block time to 8 seconds and refine staking mechanisms. Primer Tezos (XTZ) is a Liquid Proof-of-Stake (LPoS) blockchain network known for its strong focus on security, upgradeability, and democratic community governance. Its smart contracts on Layer-1 (L1) are implemented using the Michelson language, designed to facilitate formal verification while also offering Ethereum virtual machine (EVM)-compatibility through Etherlink, a community-supported Layer-2 (L2). The network features on-chain governance and self-amending functionality, enabling stakeholders to adopt protocol upgrades without requiring a network hard fork. Recent upgrades on Tezos have focused on scalability and performance through Smart Rollups and a Data Availability Layer (DAL). The Mumbai upgrade introduced Smart Rollups, a L2 scaling solution that enables throughput beyond 1 million TPS and customization to adapt to specific use cases, such as implementing new coding environments. The Paris upgrade reduced L1 block time from 15 to 10 seconds, bringing 20-second finality. It also introduced the DAL, a data-availability solution that boosts Smart Rollup scalability and is part of the Tezos protocol. Finally, the Paris upgrade implemented a new staking mechanism and Adaptive Issuance, which adjusts token issuance based on the staked ratio of XTZ. In Q3, developer teams Nomadic Labs, Trilitech, and Functori proposed the Quebec upgrade, aiming to reduce block time to 8 seconds, enhance staking, and adjust Adaptive Issuance to curb inflation. By the end of Q4, this proposal had moved to the final ‘Promotion’ voting phase. Current R&D work focuses on realizing ‘Tezos X,’ a proposed roadmap for boosting the blockchain’s performance, composability, and interoperability, with the goal of delivering a "cloud-like" developer experience. Leveraging Smart Rollup technology and the data-availability layer, it enables developers to build complex, scalable applications using mainstream programming languages, with improved connectivity across the ecosystem. Website / X (Twitter) / Discord Key Metrics Financial Overview Revenue In Q4 2024, Tezos L1 transaction fees rose to 11,100 XTZ, marking a 30.4% QoQ increase in XTZ terms (90.8% in USD terms). Etherlink, Tezos' first EVM-compatible, non-custodial smart rollup, experienced a significant 44% QoQ growth, reaching 6,669 XTZ . As a cost-efficient L2 solution, Etherlink Mainnet's rapid growth outpacing L1 aligns with expectations for its scalability and cost advantages. Supply and Market Capitalization XTZ, the native token of Tezos, is used as a medium of exchange and for staking, delegating, and facilitating governance. As of the end of Q4, the circulating supply was 1.0 billion XTZ. The Paris upgrade introduced the Adaptive Issuance mechanism, which is designed to incentivize a secure network, while keeping inflation at a minimum. The target for staking is 50% of total XTZ supply, and the mechanism dynamically adjusts staking rewards to achieve this with the least possible XTZ issuance. The aim is to minimize the dilution of XTZ, improve liquidity, reduce inefficiencies, and make XTZ better suited for real-world use cases. The annualized real yield for validators remained at 1.5%, with a QoQ decrease of 1.9%. Tezos' market capitalization reached $1.3 billion in Q4 2024, a substantial 94% increase. YoY market capitalization grew 40%. This growth was driven by increased demand for the gas token, reflecting heightened activity and adoption of the network in 2024. Network Overview Usage In Q4 2024, overall network activity on Tezos declined by 5% QoQ, with average monthly transactions and contract calls totaling 3.2 million. This trend aligns with expectations as activity shifts to Layer 2 solutions, such as Etherlink, which offers cheaper and faster transactions, supporting the network's scaling objectives. In Q4 2024, network activity on Etherlink averaged over 485,000 monthly transactions, representing 18% of Tezos L1's transaction counts. This highlights the rapid adoption of Etherlink within just six months of its launch, showcasing its growing role as a scalable L2 solution within the Tezos ecosystem. In Q4 2024, Tezos experienced a 37% QoQ increase in daily active addresses (DAA), averaging 1,800 unique addresses per day. Despite declining total transactions, the rise in unique wallets suggests an expanding user base, indicating that more individuals are engaging with the network QoQ. Network Upgrades Quebec Protocol Upgrade On Sept. 13, 2024, Nomadic Labs, TriliTech, and Functori proposed the Quebec protocol upgrade for Tezos, marking the 17th protocol upgrade in the network’s governance history. The upgrade aimed to enhance Tezos' performance and staking mechanisms. Two versions, Quebec A and Quebec B, were introduced during the ‘Proposal phase,’ which concluded on Sept. 28, 2024. The B proposal advanced to the ‘Exploration’ phase, running from September 28 to October 12, but failed to achieve the required 80% supermajority. On Oct. 26, 2024, a modified version of Quebec B, dubbed Qena, advanced to the Exploration phase but also didn’t achieve supermajority. In response, the Quebec developer teams introduced a revised Quebec proposal on November 9, which completed the Proposal phase on November 24. The revised proposal progressed through the Exploration phase until December 8, followed by a two-week ‘Cooldown’ phase ending on December 22. The ‘Promotion’ phase began on December 22, 2024, with voting scheduled to conclude on Jan. 6, 2025, determining if the upgrade will be applied to the Tezos mainnet. Key Changes Introduced by the Quebec Upgrade: Reduced Block Time: Block times were reduced from 10 seconds to 8 seconds, improving transaction throughput and reducing finality time to 16 seconds without requiring significant hardware updates for bakers. Adaptive Maximum Issuance: The adaptive issuance mechanism, introduced in the Paris upgrade, was refined. The maximum issuance rate now adjusts based on the network's proximity to the target staking ratio of 50%, reducing inflationary pressure as the network approaches this threshold. Reduced Weight for Delegated Funds: The weight of delegated funds in a baker's staking power was reduced from 50% to 33%, decreasing the influence of delegated stake on consensus rights and encouraging more direct staking. Improved Delegation Rights Computation: The upgrade adjusted the method for calculating a baker’s minimum delegated balance per cycle, addressing the dilution of delegation rights and improving the staking user experience. Increased External Stake Limit: The maximum amount of external stake a baker can accept was raised from five to nine times their self-staked balance, allowing bakers to expand their staking capacity further. The Quebec upgrade focuses on improving network efficiency, reducing inflation risks, and balancing staking incentives. Many of these enhancements are intended to further progress towards Tezos X and they serve as an illustration of Tezos’ long-term upgradability. Octez Software Updates In Q4 20244, Tezos experienced multiple updates to its Octez Software, focusing on network performance, stability, and protocol enhancements across three key releases. On Oct. 2, 2024, Octez v20.3 was released with an experimental feature allowing the use of a new storage backend called Brassaia. The node’s storage version and snapshot formats were updated to improve compatibility and data management. Several outdated components were removed, including the proxy server binary and older command options related to previous protocol versions like Oxford and Paris. The update also simplified how baker nodes handle staking rounds, improving clarity and reducing unnecessary options. Additionally, refinements were made to the protocol environment, and new remote procedure call (RPC) methods were added to enhance network diagnostics and peer monitoring. On Nov. 14, 2024, Octez v21.0 introduced protocol environment version 13 with improvements targeting scalability and rollup performance. The node storage system was upgraded to accommodate the growing number of blocks produced per cycle, enhancing overall storage efficiency. Block propagation speed was improved, while the Data Availability Layer (DAL) node received stability enhancements. For Smart Rollup nodes, the update introduced automated message execution and additional performance metrics for better state and health monitoring. Clearer logging was also added, making it easier for node operators to identify configuration issues. Nodes upgrading from older versions required a manual data migration to align with the new storage structure, with varying completion times depending on the node’s history retention mode. On Dec. 17, 2024, Octez v21.1 was released, focusing on improving peering stability and reducing unnecessary reconnection attempts. Changes were made to prevent nodes from repeatedly attempting to connect with unreachable peers and to avoid duplicate peer connections. The release also introduced regular retries for resolving bootstrap node addresses, enhancing initial network connectivity. Additionally, a command-line option related to DAL node timeout settings was removed to simplify node configurations and reduce potential errors. Development In Q4 2024, more than 5,800 contracts were deployed on Tezos L1, an 18% QoQ increase. Meanwhile, Etherlink saw over 1,700 new contracts deployed, a remarkable 184% QoQ surge, underscoring strong builder adoption of the L2 solution. As of November 2024, Tezos has over 167 monthly active developers across over 3,600 repos. From September 2024 to November 2024, average monthly new developers grew from ~38 to 54. Security Tezos uses a Liquid Proof-of-Stake mechanism, which requires validators (known as “bakers” in the Tezos ecosystem) and delegators to stake XTZ as collateral to secure the network. Rewards and fees collected from transactions are paid to validators and delegators to maintain the network. Active validators and active validator stake have remained consistent over the last three quarters. In Q4, active validators saw a 4% decrease, and validator stake decreased by 35%, QoQ reaching 89 million XTZ. Delegators stake XTZ on active validators and receive a portion of fees and rewards collected. In Q4, active delegators decreased by 1.5%, however stake from delegators increased by 2.4% QoQ. Adaptive Issuance dynamically adjusts the issuance of XTZ based on the proportion of staked tokens to the total supply. At the end of each blockchain cycle, the issuance rate is modified to target a protocol-defined staking level, currently set at 50%. This mechanism incentivizes staking to provide stable security for the network. The Tezos network has shown consistent year-over-year stability in the number of validators and delegators, as well as in staked XTZ. This stability is crucial for secure and scalable L2 growth. Validators in the ecosystem are also decentralized geographically and by host service providers, further ensuring the network's resilience and security. Governance Tezos utilizes a Liquid Proof-of-Stake mechanism, enabling staked XTZ to be used for both network security and governance. The network's self-amending blockchain reduces the need for hard forks by employing onchain governance for protocol upgrades. Users delegate their XTZ to validators who participate in stake-weighted voting. The governance process is divided into five periods, spanning approximately 2 months and 10 days. To complement protocol governance, Tezos Commons established the Tezos Ecosystem DAO, which manages and allocates XTZ for community projects. The DAO’s initial funding came from NFT sales on Objkt and donations from ecosystem participants. Etherlink follows an onchain governance model similar to Tezos L1, ensuring fairness and transparency. Governance for Etherlink is self-amending (meaning no hard fork), controlled by L1 bakers, and pilots both upgrades and the sequencer operator. The governance process fully happens on Tezos L1 through dedicated smart contracts, and consists of three stages: a Proposal period, a Promotion period, and a Cooldown period. The Etherlink governance periods are synchronized with L1 governance periods. The first upgrade for Etherlink was implemented successfully shortly after launch. Ecosystem Overview Etherlink Adoption, Gaming, and NFTs Q4 2024 saw a significant uptick in Web3 gaming and NFT activity on Tezos, with Etherlink playing a key role in expanding the ecosystem. Etherlink, an EVM L2 built on Tezos' Smart Rollup technology, offers 500ms transaction finality and low fees while maintaining Tezos' established security and governance framework. It is designed to support applications requiring high throughput and cost efficiency while enabling developers to deploy Ethereum-based smart contracts directly on the Tezos network. New integrations and project launches marked this expansion in gaming and NFTs. On Oct. 2, 2024, Etherlink integrated with Rarible, a prominent NFT marketplace, through the launch of the BattleRise Founder Pass, the first gaming NFT on Etherlink. The Founder Pass provided in-game perks, including a share of BATTLE tokens, staking rewards, exclusive items, and the ability to rent the pass via an in-game NFT marketplace. Beyond this launch, the gaming sector on Etherlink continued to grow with projects like Sugarverse, a Web3 gaming platform developing multiple community-driven games. Its first release, Sugar Match, a match-3 puzzle game, incorporates tradable NFTs and reward mechanisms, further demonstrating Etherlink's capacity to support diverse gaming experiences. Etherlink also saw collectible drops including two sold-out collections MDCL and Chapter 00. Alongside gaming, Tezos also made strides in real-world asset (RWA) tokenization using Etherlink. Uranium.io launched as a decentralized platform allowing fractional ownership of physical uranium stored in regulated depositories, tokenized as Triuranium octoxide (U3O8). Expanding its reach in asset tokenization, VNX, a cryptocurrency platform, launched stablecoins on the Tezos blockchain, reflecting growing institutional interest in leveraging Tezos for financial instruments, though this was not directly linked to Etherlink. The Etherlink ecosystem currently has 100+ projects developing on the network. DeFi Total value locked (TVL) in USD was up 6% QoQ in Q4 2024, closing at $53.0 million. This increase was driven by the increase in XTZ's price, since TVL in XTZ decreased by 37% QoQ. Etherlink has over $1.5 million in TVL, almost doubling since the end of Q3. This indicates the decrease of TVL on Tezos is due to a movement of liquidity from Tezos to Etherlink, which allows users to take advantage of lower fees and faster transactions. Most TVL in crypto exists on EVM-compatible networks. The launch of Etherlink gives developers the ability to deploy EVM-compatible protocols on Tezos, attracting new communities to the ecosystem. Etherlink’s launch expands Tezos' reach by drawing users and builders from other EVM networks, increasing its presence in the DeFi space. At the end of Q4, over $2.6 million in assets were bridged from other EVM chains. Youves, a decentralized synthetic assets application, is the largest protocol by TVL, securing over $35.4 million in assets, up 28% since Q3. Sirius, a liquidity-baking protocol for XTZ/tzBTC pools, had the second-largest TVL at over $10.1 million. Kord.Fi, another liquidity-baking protocol for XTZ-tzBTC, had the third-largest TVL with over $5.3 million. With the capital efficiency improvements in tzBTC 2.0, these liquidity-baking protocols may provide additional incentives and thus increase their TVL. The largest protocol on Etherlink is IguanaDEX, a concentrated liquidity decentralized exchange with over $1.12 million TVL and $25.5 million in volume in Q4. Superlend, supported by DeFi Catalyst Explorer (DCA), is the largest lending protocol on Etherlink, with over $187,000 in TVL. NFTs and Art In Q4 2024, Objkt dominated the Tezos NFT market with an average of 2,800 weekly active addresses, capturing 33% of the user market share. NFT sales dropped 12.2% QoQ to $773,000, and unique active users declined 32.3% to 16,500. Art on Tezos was present at Paris Photo with Objkt.one, curating a booth dedicated to world-renowned digital artist Lorna Mills. During Miami Art Week, six days of programming took place across five different locations, including Scope Art Fair and the Design District with ICA Miami. The Tezos Foundation announced Paintboxed Tezos World Tour, a partnership with Art Meta, that will see a new generation of creators introduced to the groundbreaking 1980s digital art tool to create iconic images such as the MTV logo. The partnership will culminate in a selling exhibition during Art Basel 2025 in Basel. The ARTicle Series continued to spotlight digital and generative artists within the ecosystem. Meanwhile, Sotheby's auctioned two artworks on Tezos during its Digital Art Day Auction. Agoria and InfiniteInk produced a generative AI custom music minting experience with 500 editions. A unique edition was sold as 1/1 and marked the highest music sale on Tezos (8500xtz). By the end of Q4 2024, Tether's USDT issuance on Tezos exceeded $37.2 million, making it the largest stablecoin on the network. It was followed by uUSD, which reached $11.7 million. The largest stablecoins exclusively issued on Tezos were Kolibri’s kUSD and USDTez’s USDtz, which had over $877,000 million and over $295,000 in stablecoins issued, respectively. In September 2024, VNX, a leading European tokenization platform, launched VNX EUR (VEUR) and VNX CHF (VCHF) stablecoins on Tezos, VEUR closed Q4 with over $2,000. Partnerships and Integrations Tezos was adopted into the idOS network's OpenFi initiative, an effort to develop a modular, interoperable financial system through collaboration with multiple blockchain entities. Other partners in the consortium include Arbitrum, Circle, Ripple (via its RippleX platform), NEAR Protocol, Aleph Zero, and Radix. OpenFi aims to create a decentralized financial ecosystem where blockchain networks can seamlessly interact and share data, expanding cross-chain functionality for decentralized applications (dApps). The inclusion of Tezos in the OpenFi initiative signifies the role played by Tezos technology in contributing to the development of the interoperable financial framework. Tezos' ability to attract institutional interest continued in Q4’2024, with several collaborations highlighting the protocol’s growing presence in traditional finance. As Tezos experiences growth in the gaming sector, with projects like Sugar Gaming and BattleRise expanding on the network, investors such as Quantix Capital have noticed, betting $1 million on Tezos' long-term potential in the gaming sector. This investment, made through TZ APAC, Tezos' Singapore-based adoption hub, aims to boost blockchain gaming innovation on the platform. Quantix Capital’s Managing Director, Jake Seltzer, emphasized that the investment goes beyond financial backing, aiming to empower creators to reshape the future of interactive experiences. Additionally, partnerships with infrastructure providers and Web3 tool developers ensured that the Tezos developer ecosystem was fully supported in Q4. The Tezos Foundation issued a grant to ECAD Labs to continue developing Tezos Taquito, a Web3 library designed to simplify the interaction between developers and smart contracts on the Tezos blockchain. This tool has become a critical resource for building decentralized applications on the network. The foundation also supported Signatory, a remote signing solution to enhance the security and flexibility of transaction signing within the Tezos ecosystem. Finally, in the public sector, Electis, a secure electronic voting platform, integrated Tezos' blockchain technology to support voting infrastructure for 60,000 schools across France, with hopes of creating secure, transparent, and verifiable digital elections. Tezos' blockchain is used to ensure vote immutability, while Electis employs encryption and decentralized storage to safeguard data integrity. Future Development As Tezos continues to evolve, several key initiatives are shaping the future of its ecosystem. Here are the major upcoming developments: JavaScript Rollup: Jstz, a Smart Rollup, will enable developers to build and deploy JavaScript-based smart contracts on Tezos. The first JavaScript applications are expected to launch, broadening Tezos' developer base by tapping into the vast JavaScript ecosystem. Tezos X Roadmap: 2025: Integration with the Data Availability Layer (DAL), enabling high-throughput communication between Etherlink rollups and the main sequencer, further scaling applications. Launch of Michelson Rollup, creating an execution environment compatible with Tezos L1, with instant asset transfer to Etherlink. 2026: Introduction of Canonical Rollup, providing an integrated execution environment with instant cross-application transactions across different programming languages. Closing Summary In Q4 2024, Tezos demonstrated significant ecosystem growth, contract deployments on L1 increased by 18% QoQ, with over 5,800 new contracts launched. Transaction fees collected on L1 surged by 30.4% QoQ in XTZ terms (90.8% in USD terms). Meanwhile, Etherlink, Tezos' first EVM-compatible L2, saw rapid adoption, averaging over 485,000 transactions per month, roughly 19% of L1's activity. Contract deployments on Etherlink rose by an impressive 184%, reaching over 1,700 new contracts, underscoring strong builder adoption within just six months of its launch. The ecosystem also observed a 37% QoQ increase in daily active addresses, averaging 1,800 unique addresses per day, while Etherlink surpassed 117,000 unique wallets since its May 2024 launch. These metrics highlight growing user engagement across both L1 and L2 solutions. With advancements in governance, including the ongoing Quebec upgrade, and strides in sectors like gaming, DeFi, and real-world asset tokenization, Tezos continues to strengthen its position as a leading blockchain ecosystem. The network's focus on scalability, interoperability, and builder adoption sets a strong foundation for sustained growth and expansion into 2025 and beyond.
Source: Mohamed Allam — Published: 2025-01-30T14:00:00ZUnderstanding Pundi AI: A Comprehensive Overview
Key Insights Pundi AI aims to solve issues in AI data sourcing and tagging by creating a decentralized, high-quality data marketplace with fair rewards for contributors. The Pundi AI Data platform compensates users for data tagging, promoting decentralized participation in AI data management. Pundi Labs is merging Function X's f(x) Core and Pundi X Chain into Pundi AIFX to enhance scalability, interoperability, and EVM compatibility. Pundi AI plans to rebrand the $FX token to $PUNDIAI. Pundi AI will introduce the Pundi Fun Launchpad for new AI agents to launch their tokens. A Pundi AI market-making (MM) agent will handle liquidity by buying AI agent tokens based on the open market. Collaborations with Futureverse, Nubila, and Hugging Face leverage cross-industry synergies for AI data solutions and metaverse integration. Background Data quality is a considerable challenge when moving AI projects into production. Data teams often need help identifying relevant data and accessing high-quality data that can serve as the foundation for training effective machine learning models. In a recent survey of over 1,500 global AI decision-makers, the early data steps in the AI life cycle, including sourcing, preparing, standardizing, and analyzing, were classified as more challenging than model configurations. For AI developers and companies, investing in diverse, high-quality datasets is essential for the success of putting any AI initiative into production. High-quality data can be labeled or tagged so that AI systems can accurately recognize patterns and make informed decisions. However, data labeling presents significant challenges, primarily due to its manual nature. Despite advances in automation, large-scale human-labeled data is still necessary because current AI tools struggle to tag data accurately and comprehensively. Reinforcement Learning from Human Feedback (RLHF) is crucial for model training due to our understanding of context, nuance, emotional intelligence, and cultural awareness—elements AI has yet to master. This means the manual review of human-labeled data is irreplaceable for the foreseeable future. Another challenge is the centralized nature of data tagging. Current systems often suffer from inadequate rewards for contributors, which leads to suboptimal data quality. Poor inputs inevitably result in poor outputs, creating a cycle that hinders the development of robust AI models. Without proper incentives, data contributors may lack the motivation to provide high-quality, accurate tags, further exacerbating this issue. Pundi AI aims to address these challenges by creating a high-quality, decentralized, transparent data marketplace that rewards its contributors fairly. By leveraging blockchain, Pundi AI is working to redefine how data is sourced and tagged, ensuring contributors are appropriately rewarded and that the data available for AI training is of the highest possible quality. Introduction Zac Cheah and Danny Lim co-founded Pundi X in 2017 to make cryptocurrency accessible to everyone by providing blockchain-powered devices and applications for retail transactions. The Pundi X ecosystem, which was built on the Pundi X Chain, consists of the following products: PundiX Pay - PundiX Pay is a QR code-based crypto payment solution that enables merchants to accept digital currencies without needing traditional point-of-sale (POS) systems. Customers can pay using BTC, ETH, BNB, and USDT directly from their crypto wallets. Pundi XPOS (Point-of-Sale) Device - Pundi XPOS is a blockchain-based POS device that allows merchants to accept cryptocurrency payments seamlessly. It supports several digital assets and integrates with popular wallets like MetaMask, Trust Wallet, and XWallet for QR codes or NFC payments. Additionally, Pundi X offers p(X) cards, which are physical cards that function similarly to hardware wallets. $PUNDIX Token: $PUNDIX is the native utility token of the Pundi X ecosystem used for transaction fees, staking, and governance. Developers must use PUNDIX tokens to publish applications on the Pundi XPOS app store. Advertisers, developers, and ad networks can place advertisements through the Pundi X advertising platform using PUNDIX tokens, facilitating targeted marketing within the ecosystem. Function X: Function X (f(x) Core) is an interconnected blockchain system designed by Pundi X to power its decentralized applications (dApps) and services. It focuses on scalability, security, and efficiency. FX is Function X’s token for staking, transaction fees, and governance. Transition from Dual Chains to a Unified Platform Previously, Pundi operated two separate blockchain networks: f(x) Core: A blockchain built on the Cosmos SDK and designed to support decentralized applications (dApps) and provide a scalable infrastructure. Its architecture emphasizes interoperability, leveraging the Inter-Blockchain Communication (IBC) protocol and Cosmos’s modular structure for enhanced functionality. More details about its functionality and role in the ecosystem can be found here. Pundi X Chain: Based on the Cosmos SDK, this f(x) Core subnet focused on facilitating cryptocurrency payments and transactions within the Pundi ecosystem. However, it lacked compatibility with Ethereum Virtual Machine (EVM), which limited its usability and potential integrations. Consequently, the Pundi X Chain is being deprecated, and all its assets are being moved to AIFX. In August 2024, a governance proposal was passed to merge Pundi X and the f(x) Core into a single entity, rebranded as Pundi AIFX. Upon approval, the Pundi X team began the merger process, including the retirement of the Pundi X Chain and the migration of assets to Pundi AIFX. The f(x) Core validators will continue operation under the rebranded AIFX name. Pundi AI Ecosystem Pundi AI’s ecosystem consists of three layers: Application Layer Major Layer-1 (L1s) and Layer-2’s (L2s) Omnichain Data Layer (Pundi AIFX) The primary objective of Pundi AIFX is to be a data processing layer. Value accrues at the base layer through the verification of tagged data. Tagged data can then be transferred through major networks to applications, which leverage the data for superior model training and performance. Pundi AIFX's secondary goal is to prevent large corporations from monopolizing AI data. To this end, it has opened several data sanitization tasks to the public, which could generate additional income for users. Pundi AIFX derives value through three separate product offerings built on the network: Pundi AI Data The Pundi AI Data platform introduces a "Tag to Earn" incentive mechanism, compensating users for tagging data. The supply side (datasets) is internally curated through AI agents like Truth Terminal and externally sourced through paid data provider partnerships. Users meet the demand side (data tagging and reviewing) by completing paid text and image tagging tasks. Users connect to Pundi AI with their wallets and can select from various data labeling tasks. Alternatively, users can review labeled data for accuracy. Either type of task pays out a preset amount of USDT rewards paid by dataset providers upon verification by the AIFX layer. Taggers and reviewers can rate task publishers, creating a transparent marketplace where contributors can opt to work with fair publishers, and publishers can choose top-performing contributors. Tasks undergo multiple iterations of data labeling and are reviewed or tagged by several individuals or AI agents during the review process. The platform stores tagged data on the blockchain and will eventually sell it on a marketplace for AI companies and developers to purchase. The platform is designed to compete with high-quality data providers, such as Scale AI, that provide organizations with tagged data to train AI applications and models. The industry has become controversial due to unfair work conditions and unrealistic quotas. Pundi AI will offer a decentralized alternative to ensure data providers, taggers, and reviewers are fairly compensated through a tokenized reward system. Pundi AI Data addresses the growing challenge of limited fresh data for AI training. Synthetic data often lacks the complexity and nuance of real-world data, leading to poor generalization, bias, and potential model degradation. By democratizing access and labeling to high-quality, real-world data, Pundi AI aims to ensure AI models remain reliable, unbiased, and effective in real-world scenarios. Pundi Fun Launchpad and AI Market Maker Agent In January, the Pundi team announced they are building the Pundi Fun AI Agent Launcher, which will allow projects to train and launch AI agents using trained datasets on Pundi AI Data. Pundi Fun will enable developers to launch a token through a bonding curve mechanism, which ensures fair token distribution, reduces launch price volatility, and maintains liquidity by dynamically adjusting token prices based on supply and demand. A Pundi AI market-making (MM) agent will handle liquidity by buying AI agent tokens based on the open market. Projects bribe $vePUNDIAI holders using their agent tokens to secure enough votes to receive funding from the AI MM Agent. The AI MM Agent handles the onchain market-making process once the vote passes; the community conducts voting weekly. AI Agent tokens minted using other launchpads can still participate in the Pundi AI MM Agent platform voting by bribing $vePUNDIAI holders. Fees from the Pundi AI MM Agent are redistributed to $vePUNDIAI holders, creating an incentive flywheel for the vePUNDIAI token. Pundi AI Data Marketplace The Pundi AI Data Marketplace will enable users to buy and sell data assets. The platform aims to connect dataset providers, labelers, and sellers. The data marketplace will introduce new clients on the demand side who can purchase labeled data from Pundi AI or other dataset providers. Each data piece is encrypted, verified, and stored as an NFT, guaranteeing its provenance and integrity. Pundi AI Data Marketplace is scheduled to launch in Q1 2025. PURSE+ PURSE+ SocialAI is a browser plugin that allows users to analyze, tag, and categorize social data on X (Twitter). Users earn rewards through $PURSE tokens, which can be staked to amplify earnings. PURSE+ is part of the broader Pundi AIFX goal of democratizing data labeling. $FX Token (rebranding as $PUNDIAI) The FX token, currently rebranding to $PUNDIAI, has a delegated supply of 1.9 billion tokens. The $FX token is fully diluted, although approximately 60% of the token is locked in the validator node and community pool. The supply will be reduced by a factor of 100 in the conversion to $PUNDIAI, i.e., 100 $FX tokens will be converted to 1 $PUNDIAI token. This means no new tokens will be minted in the rebranding. The rebranded $PUNDIAI serves as a bridge between contributors and users of AI data. Payments will be directed into the Pundi AI salary pool, and rewards are periodically distributed to contributors. Contributor compensation is directly correlated to data sales and service usage. The salary pool also serves as a staking yield pool for $PUNDIAI. AI data contributors receive earnings after data is reviewed and users can verify data quality. Roadmap & Partnerships The Pundi AI roadmap consists of three phases. Phase 1 occurred in Q3 2024, and the protocol is currently in Phase 2. Phase 1 - Inception: Website upgrade Publication of the PUNDI AI White Paper Data annotation browser extension (alpha release) Pundi AIFX omni layer merges with the f(x) Core. Block explorer upgrade Governance voting goes live Phase 2 - Perception: AIFX data layer to connect to Cosmos. Pundi AI Data tagging platform launches whitelisted beta New partnerships with AI projects Pundi AI Marketplace launches alpha Introduction of the Tag-to-Earn model Token swap (subject to community and exchange support) Phase 3 - Intersection: AI Marketplace and referral program launch Data labeling tool launch browser and mobile app Continued partnerships with AI projects AI Marketplace launches salary pool and staking pool Pundi AIFX data layer connects to more L1/L2 networks "Tag to Earn" acceleration program Pundi AI has also spent Q3 and Q4 partnering with several different companies and crypto protocols, including: Futureverse: Pundi X and Futureverse have partnered to integrate AI and blockchain, advance metaverse payments, and leverage AI data from their ecosystems. Futureverse users will have an opportunity to earn rewards by labeling data through Pundi AI. Pundi X will integrate The Root Network (ROOT) into its payment services. They also plan to enhance metaverse payments via Readyverse and connect Futureverse users to Pundi X’s SocialFi platform, Purse+. Nubila: Pundi AI has partnered with Nubila Network to integrate real-time ESG data from Nubila's global weather stations into the Pundi AI Data platform. Nuvila is a DePIN protocol that leverages AI and DePIN to collect, analyze, and assess economic data. Hugging Face: Pundi AI will partner with Hugging Face to leverage its community of developers and data contributors. These contributors can participate in a reward-sharing program by tagging and reviewing data. Closing Summary The Pundi AI ecosystem integrates blockchain technology and AI data solutions to tackle challenges in data tagging, accessibility, and decentralization. Leveraging the Pundi AIFX omnichain infrastructure, it offers tools like Pundi AI Data, PURSE+, and the upcoming Data Marketplace to ensure high-quality, transparent solutions for contributors and users. The rebranding of Function X to Pundi AIFX enhances scalability, interoperability, and EVM compatibility, enabling decentralized applications and cross-chain integration. With a phased roadmap and partnerships with organizations such as Futureverse and Hugging Face, Pundi AI is set to drive long-term growth through initiatives like the AI marketplace and data tagging tools. The transition from $FX to $PUNDIAI further aligns tokenomics to incentivize contributions and utility, positioning Pundi AI as a key player in decentralized AI data management.
Source: Sam Ruskin — Published: 2025-01-27T14:00:00ZState of XRP Ledger Q4 2024
Key Insights XRP’s market capitalization increased 246% QoQ, outpacing the combined market capitalization of BTC, ETH, and SOL, which increased by 44%. RLUSD, Ripple’s USD-pegged stablecoin, launched in December and is available on several platforms, including Uphold, Bitso, MoonPay, Archax, CoinMENA, Independent Reserve, and Bullish, with more platforms to come. Average daily CLOB volume and average daily AMM volume increased 1,140% (12x) and 3,100% (32x) QoQ. In November, the XRP Ledger Foundation’s incorporation documents were filed in France, establishing a new entity to support the XRPL’s development and operations. Four founding members—XRPL Commons, XRPL Labs, Ripple, and XAO DAO—established the entity. A number of real-world assets (RWAs) were tokenized and issued on the XRPL in Q4 such as abrdn’s US Dollar Liquidity Fund (Lux) via Archax. Additionally, in November SG-FORGE announced plans to launch its EURCV stablecoin on the XRPL in 2025. Primer XRP Ledger (XRP) has been running for over a decade, offering cross-currency and cross-border payments, and tokenization, among other features. Core value propositions of the XRP Ledger (XRPL) include fast and cheap transactions (relative to other currency-focused networks) and native functionalities — such as tokens, NFTs, a decentralized exchange (DEX), escrow functionality, embedded compliance, and token management. With these capabilities, the XRPL can execute many of the same functions as other networks. NFTs, stablecoins, synthetic assets, and other markets found on programmable settlement layers are available on the XRPL as native functionality with composability through enshrined mechanisms such as a central limit order book (CLOB) and automated market maker (AMM). The XRPL base layer doesn't currently support arbitrary smart contracts, which was a deliberate design choice to prioritize security and stability through simplicity. However, plans to introduce native smart contracts were announced in September 2024, alongside long-standing initiatives to introduce advanced scripting functionality, such as through solutions like Hooks. Additionally, alternative execution environments, via sidechains, add additional functionality and use cases to the overall ecosystem. The XRPL is supported by various development groups and individuals, including the XRP Ledger Foundation, Ripple, XRPL Labs (and Xaman), and XRPL Commons. It provides a digital payment infrastructure not just for individuals but also for existing financial entities, such as commercial banks and fintechs, with the community's deep interest in B2B and B2C solutions for finance. For a full primer on XRP Ledger, refer to our Initiation of Coverage report. Website / Reddit / Discord Key Metrics Financial Analysis At the close of Q4’24, the XRPL’s native token, XRP, was the fourth largest crypto asset (up three spots from Q3’24) by market capitalization at $119.5 billion. Its circulating market cap increased 246% QoQ, outpacing the combined market capitalization of BTC, ETH, and SOL, which increased by 44%. XRP’s price increased 241% QoQ, with the discrepancy between market cap and price due to a 1.6% increase in circulating supply. Notably, in December, Wisdom Tree became the fourth company to complete an S-1 filing to launch an XRP ETF following filings from Bitwise, Canary, and 21Shares in October and November. Also in November, WisdomTree’s Physical ETP launched in the European market on Börse Xetra, SIX Swiss Exchange, and Euronext Paris and Amsterdam. Additionally, Robinhood added support for trading XRP on its platform and Bitwise announced its European XRP ETP would receive investment from Ripple. Finally, in September of last quarter asset management firm Grayscale launched its XRP Trust, providing another way for accredited investors to gain exposure to the asset. On XRPL, transaction fees are systematically burned, applying deflationary pressure to the total supply of 100 billion XRP. Since the XRP Ledger’s inception, about 13.3 million XRP ($27.8 million at the close of Q4’24) has been burned. This low burn rate is due to the relatively low transaction fees (<$0.004 per transaction) on the network. Counteracting the burn rate, 1 billion XRP ($610 million at the close of Q3’24) is released from escrow to Ripple per month. Any XRP not spent or distributed by Ripple in that month is put into new escrow contracts. This system will continue until the remaining ~36 billion XRP becomes liquid. After all escrowed tokens become liquid, the deflationary pressure from burned fees will be the only variable related to supply. Unlike many other cryptocurrency networks, the XRPL does not distribute rewards or transaction fees to its validators. In Proof-of-Association (PoA), rather than receiving rewards, validators are mainly incentivized by supporting the decentralization of the network, similar to a full node for Ethereum/Bitcoin rather than a validator/miner. The PoA consensus algorithm relies on trust between nodes, organized through unique node lists (UNLs). XRP’s QoQ market cap increase of 246% outpaced the combined market capitalization of BTC, ETH, and SOL, which increased by 44%. On an annual scale, XRP’s circulating market cap has increased 259% YoY. On the XRPL, transaction fees are burnt and not distributed to stakers like on many other networks. The burning of those fees still decreases the overall supply, adding value to the remaining XRP. In this way, transaction fees still represent a redistribution of wealth from transaction fee spenders to XRP holders. Network Analysis All measured network metrics grew in Q4, the first such quarter since Messari began covering the XRPL in Q1 2023. Chief among them, new addresses increased 382% QoQ to 507,000 suggesting the onboarding of new users. Additionally, total active addresses increased 99% QoQ to 56,000, indicating an increase in both new and existing users. On an annual scale, quarterly new addresses increased by 115%. Account creations and deletions are meaningful on the XRPL (unlike on most networks) as accounts require a 1 XRP deposit to be created, which can be reclaimed after deleting the account. As such, the XRPL’s account metrics are more reliable than other networks where account creations can easily be spammed/Sybiled at zero cost. Notably, the base reserve requirement was lowered from 10 XRP to 1 XRP in December 2024. Addresses on the XRPL can contain destination tags, which enable a single address to receive and track XRP deposits for an arbitrary number of users. As a result, the number of daily active addresses is skewed downward, given that one account (e.g., a centralized exchange) could be responsible for a large number of users. It should be noted that a unique address is required for receiving tokens on most other networks, like ETH on Ethereum or BTC on Bitcoin. For the third consecutive quarter active receiver addresses exceeded active sender addresses on the XRPL. The active recipient metric is determined by the number of addresses that receive a transfer or other transaction. When recipients outpace senders, it indicates that more previously inactive wallets are receiving tokens distributed by senders than there are senders distributing those tokens. One common reason for this dynamic is airdrops, which are a token distribution strategy to reward and engage community members. Airdrops are more practical on networks with low transaction fees, such as the XRPL, or networks that enable batch transactions. After increasing 110% in Q3, Payment transactions declined 8% in Q4. In contrast, total active addresses increased by 99% QoQ as mentioned above. Historically, for smaller activity spikes, the difference between the active recipient and sender addresses has been largely due to centralized exchanges and custodians using destination tags and sending Payment transactions. Centralized exchanges and custodians mostly use the Payment transaction type for deposits and withdrawals. As such, the Payment transaction type has consistently had more receiving addresses than sending addresses. In addition, users typically prefer creating wallets on centralized solutions for easy access to the initial XRP required to create a self-custody wallet. After acquiring their initial XRP, many users withdraw to their self-custody wallets, resulting in fewer active senders and many active receivers. The total daily transactions metric includes 47 different transaction types, such as payments, escrow creations, NFT burns, and account deletions. Average total daily transactions increased 3% QoQ to 1.80 million per day. Prior to Q1 2024, OfferCreate, a transaction type that submits an order to exchange cryptoassets, has consistently represented the bulk of transactions. This transaction type only creates an “Order” on the order book and does not necessarily facilitate an exchange unless it completes an existing open Order. OfferCreate initiates a DEX limit order, and Offer objects represent bids/asks on the order book. Offers are consumed to process transactions such as Payment and OfferCancel (triggered manually or by expirations). If an Offer is only partially consumed by a transaction, a new Offer is created with the remainder of the original, similar to a UTXO. An Offer can be canceled by the OfferCancel transaction. Trust Lines are structures for holding tokens that protect accounts from being sent unwanted tokens, and the TrustSet transaction is used to open or close those Trust Lines. Payments exceeded OfferCreates for the fourth consecutive quarter though Payments and OfferCreates' share of the overall transaction count decreased 11% and 5% QoQ respectively. Prior to Q1 2024, OfferCreate was historically the most common transaction type. The “Other” category of transactions includes transaction types for NFTs, escrows, multisigs, setting signer keys, and more. These transaction types are covered in depth in the Ecosystem Overview section. DEX CLOB A built-in central limit order book (CLOB) processes exchanges on the XRPL for fungible tokens (also called Issued Currencies or simply tokens). This CLOB has been part of the XRPL since inception and comes with the benefit of fewer trust assumptions and consolidated liquidity, rather than the inherent vulnerabilities of smart contracts. The majority of transactions come from the native CLOB. Although there is only one CLOB, there are many marketplaces acting as gateways that facilitate access. Gateways, also known as marketplaces, all share liquidity and provide a viable user interface for the average user. At the end of Q4, the top three gateways by volume facilitated were First Ledger, Magnetic, and XPMarket. AMM In addition to the existing CLOB, an automated market maker (AMM) was voted into the protocol in March of Q1, as detailed by the XLS-30 standard. AMMs function through liquidity pools that algorithmically price assets rather than creating offers of preset specifications. Liquidity pools allow holders to earn a share of trade fees on their tokens by offering them as liquidity. Importantly, orders can be partially routed through the AMM and partially through the CLOB, as both work together as part of the DEX. Servers Nodes and validators, known as servers, all run the same client software: rippled. Over 78% of nodes have upgraded to V2.3.0 since its release in November of Q4. V2.3.0 was released one week early on Nov. 25, 2024, as it contained the fix to a bug, which caused several nodes to crash and the network to go offline for approximately 10 minutes that same day. As of the end of Q4, the XRPL is supported by 886 nodes and 182 validators. Nodes increased from 621, and validators decreased from 109 since Q3. XRPL servers participate in federated consensus as part of the XRPL’s Proof-of-Association (PoA) consensus mechanism. Validators do not stake tokens or receive financial rewards. Instead, the system is based on trust between nodes. Each node sets a list of trusted nodes, known as a unique node list (UNL). Additionally, the Negative UNL is a feature that adjusts servers' “effective UNLs” based on which validators are currently online and operational. The UNLModify transaction, which was called an average of 5.0 times per day in Q4, marks a change in the Negative UNL, indicating that a trusted validator has gone offline or come back online. Ecosystem Analysis Although the XRPL’s ecosystem hosts many of the same features as programmable settlement networks — such as Ethereum, Solana, and Cardano — the XRPL does not natively support smart contracts. However, in September, Ripple, along with the broader XRP community, announced its intent to introduce native smart contracts on the XRPL via an upcoming XLS proposal. Smart contracts are intended to be permissionless and provide for easy customization of XRPL’s built-in features such as escrows, NFTs, authorized trustlines, payment channels, the DEX, and AMM. Historically, arbitrary smart contracts have not been enabled on the base layer as a design choice to ensure maximum security, performance, and stability. Instead, ecosystem artifacts – such as a DEX and Issued Currencies – are natively built into the protocol. The XRPL supports multiple assets through tokens (also called Issued Currencies or IOUs). They are onchain representations of arbitrary currencies, commodities, units, etc. DeFi The total market cap of fungible tokens, known as Issued Currencies, increased 176% QoQ to $264 million. A large part of this increase can be attributed to memecoins, with both new tokens and old memecoins contributing to the surge. In November, DEX Screener added support for XRPL to allow its users to track the network’s tokens. There are more than 18,000 listed assets on the XRPL, but the top token, SOLO, accounted for 60% of the total market cap. Combined, the top five tokens accounted for more than 80% of the total market cap. The top tokens on the XRPL by market cap at the close of Q4 were as follows: Sologenic (SOLO) had a market cap of $160.3 million and 220,000 holders. SOLO is primarily used to pay transaction fees on the Sologenic gateway. Phoenix (PHNIX) had a market cap of $58.62 million and 12,800 holders. Army is a memecoin. Army (ARMY) had a market cap of $34.1 million and 12,300 holders. Army is a memecoin. Bitstamp BTC (BTC) had a market cap of $32.0 million and 4,300 holders. Bitstamp BTC is a wrapped version of Bitcoin provided by Bitstamp. Coreum (CORE) had $23.9 million in market cap and 66,900 holders. CORE is the native token of the Coreum sidechain, which was also developed by the Sologenic team. Trust Lines are structures in the XRP Ledger for holding fungible tokens and enforce the XRPL’s rule that someone cannot be forced to hold a token they don’t want. As such, Trust Lines make metrics around token behavior on the XRPL more reliable. While an account’s first two trustlines are free, thereafter the XRPL requires a lockup of 0.2 XRP (owner reserve) for each object, such as an issued currency, that the address owns. A base reserve of 2 XRP is also required to create an address. Notably, in December 2024, the base reserve requirement was lowered from 10 XRP to 1 XRP and the owner reserve from 2 XRP to 0.2 XRP. These requirements make it expensive to enact a Sybil attack on XRPL metrics, such as the number of holders. For this reason, the number of holders is a reliable metric of a token’s adoption on the XRPL. The metric is especially relevant for fungible tokens, which have much higher supplies than NFTs. Average daily CLOB volume of fungible Issued Currencies increased 1,140% (12x) QoQ to $7.9 million while the average daily amount of CLOB trades declined by 4% to 700,000. Average daily CLOB traders increased 300% QoQ to 9,300. First Ledger, a Telegram trading bot developed by the team behind xrp.cafe, is the leading DEX (i.e., the leading gateway to the native DEX) on the XRPL by trading volume facilitated. Other prominent DEXs (gateways) include MagneticX, XPMarket, and Sologenic. After its launch in March, AMM volume eclipsed CLOB volume for six days in June and peaked at $2.5 million but ended Q3 with roughly $100,000 in volume. All prominent DEXs (First Ledger, XP Market, MagneticX, Sologenic, etc), and newer platforms, such as Orchestra Finance and Moai Finance, have integrated. In Q4, average daily AMM volume increased 3,100% (32x), reflecting an exponential increase in usage. Notably, XRP Ledger’s AMM design includes a mechanism that allows the liquidity providers of a respective liquidity pool to bid LP tokens for an auction slot, which grants a discount on trading fees for a 24-hour period. This mechanism is intended to incentivize the account holding the auction slot for a given liquidity pool to keep prices in balance with external markets. Liquidity on the AMM is shared across all DEXs (gateways), just like with the CLOB. On Dec. 17, 2024, RLUSD, Ripple’s USD-pegged stablecoin launched on both the XRPL and Ethereum. The stablecoin is backed entirely by U.S. dollar deposits, short-term U.S. treasuries, and “other cash equivalents," with monthly third-party attestations. Notably, RLUSD is issued under a New York Trust Company Charter to ensure stringent oversight and regulation. Currently, RLUSD is available on several platforms, including Uphold, Bitso, MoonPay, Archax, CoinMENA, Independent Reserve, and Bullish, with more platforms to follow Prior to the launch of RLUSD, stablecoins on XRPL had not seen the adoption of major stablecoins on other networks, such as USDT ($125 billion market cap) or USDC ($37 billion market cap). However, the introduction of a trusted stablecoin in a novel execution environment has proven to be a massive liquidity event in many cases (e.g., Cardano’s iUSD in 2023), particularly as a desired pairing asset for AMMs. However, currently, assets like RLUSD, which have Clawback (a feature on the XRPL that allows token issuers to recover issued tokens after they have already been distributed to accounts) enabled, cannot trade on the AMM as clawback is not supported. For regulatorily compliant assets like RLUSD the clawback feature is required for issuance onchain. Currently, an amendment (XLS-74) is live that if enabled would add support for clawback functionality to the AMM allowing such tokens to be used on the AMM. If clawback support is enabled on the AMM, it will likely spur further growth in AMM volumes as regulatorily-compliant assets like RLUSD can begin trading. The top stablecoins and wrapped tokens (also known as IOUs) on the XRPL at the close of Q4 were as follows: Bitstamp BTC: $32 million market cap and 4,300 holders Ripple USD (RLUSD): $22.0 million market cap and 7,800 holders Gatehub Fifth (ETH): $21.6 million market cap and 26,000 holders Ripple Fox CNY: $4.2 million market cap and 11,800 holders Gatehub USD: $4.2 million market cap and 20,000 holders Bitstamp USD: $3.7 million market cap and 7,200 holders Additionally, in November SG-FORGE announced plans to launch its EURCV stablecoin on the XRPL in 2025. In April 2024, proposals were made to introduce a native lending protocol on XRPL (XLS-66), whereby users could lend and borrow supported assets, such as XRP, wBTC, and wETH using single-asset vaults (XLS-65). Unlike overcollateralized lending protocols like Aave, the protocol is intended to offer onchain fixed-term and rate loans via offchain underwriting, risk management, and an insurance fund — a model akin to that implemented by TrueFi on Ethereum. In September, a number of updates were made to both proposals including single-asset vaults holding assets directly, and both the vault and lending protocol supporting clawback and asset freezing for asset issuers with compliance and regulation requirements. Finally, Axelar, a full-stack interoperability protocol (i.e., a crypto overlay network), integrated XRPL in Q1 2024. It connected the XRPL ecosystem to the 60+ networks, including the Ethereum and Cosmos ecosystems. As the AMM grows, the Axelar connection makes it easier to source liquidity from many of the highest-TVL networks. RWAs Real-world assets (RWAs) are being made available on XRPL in several ways. In November, a tokenized money market fund was made available on the XRPL for the first time. Archax is providing access for professional investors to a money market fund from UK Asset manager abrdn comprised of part of £3.8 billion US Dollar Liquidity Fund (Lux). Ripple has allocated $5 million into the fund, which marks the first example of Ripple and Archax’s ongoing partnership intended to bring hundreds of millions of dollars in RWAs to the XRPL over the next year. Two tokenized U.S. Treasury bill funds have also been launched on the XRPL in recent months. In December Elysia introduced its tokenized U.S. Treasury bills, while in August, OpenEden launched tokenized US Treasury bills (T-bill) on the XRPL, with Ripple committing to allocate $10 million to OpenEden’s TBILL tokens. In October 2024, Aurum Equity Partners launched a $1 billion combined equity and debt tokenized fund on the XRPL via asset tokenization solution Zoniqx, which is partnered with Ripple to bring RWAs to the XRPL. In June 2024, Meld Gold announced a partnership with Ripple to bring fungible gold (GLD) and silver (SLV) assets to the XRPL. In September Meld Gold announced it had completed its first onchain transaction as part of the ongoing rollout. Also in September Tiamonds, a tokenized diamond project whereby users can hold NFTs representing real-world diamonds, launched on the xrp.cafe marketplace. Adjacent to RWAs, the XRPL has also been explored as a tool for other institutional products. Ripple is one of the leading companies developing technologies to leverage the XRPL for institutional and government use cases. The company is focused on utilizing XRP and the XRPL to drive its On-Demand Liquidity service, custody, and tokenization initiatives. NFTs On the XRPL, NFTs are built into the core protocol and do not require smart contracts for creation or transfers, like Issued Currencies (also known as native tokens). NFTs were standardized by XLS-20 in October 2022, bringing benefits such as royalties and anti-spam features. These features help users not only avoid unwanted tokens but also help them stay legally compliant by avoiding specific tokens and smart contracts that have been made illegal within specific regions. In Q4, total NFT transactions increased 460% driven by NFT mint and burn transactions, which increased 855% and 1,850% respectively. Additionally, NFT create and accept offer transactions increased 80% and 62% respectively, and NFT cancel offer transactions increased 99%. Like in Q4 2023 and Q1 2024, a massive spike in mint activity led NFTokenMint to surpass NFTokenCreateOffer as the most common NFT transaction type in Q4 2024. Previously, NFTokenCreateOffer was the dominant transaction type in both Q2 and Q3 2024. As of the end of Q4, nearly 7.5 million total NFTs have been minted with the XLS-20 standard. Notably, over 3.4 million of those mints came in Q4 2023. Notable NFT projects on XRPL include: Gaming NFTs such as Zerpmon, a Pokemon-esque game. Real-world solutions/assets such as Tiamonds tokenized diamonds or Xange’s carbon credits program. In Q2 2024 xrp.cafe launched its automated NFT launchpad that allows anyone to launch an NFT collection on XRPL. Bidds also has an NFT launchpad and is the other main NFT marketplace on the XRPL. Additionally, XPMarket features an NFT marketplace and auction mechanism. Sidechains Multiple sidechains for the XRPL are either in development or were recently launched. To date, the XRPL has maintained minimized L1 complexity, offering increased programmability for both general and specific use cases on sidechains. Coreum Coreum (CORE) is an enterprise-grade L1 focused on interoperability and scalability. Coreum runs a WASM VM and is secured by a Bonded Proof-of-Stake (BPoS) consensus mechanism. CORE is used for transaction fees, staking, and validator rewards on Coreum. Coreum was built by the Sologenic team to service user needs that could not be efficiently managed on the XRPL. The network's initial focus is on providing security tokenization, such as tokenized stocks from the NYSE and synthetic assets. In March of 2024, Coreum completed an IBC integration, granting access to all IBC-connected networks such as Cosmos Hub, Ethereum, and BSC. This was followed by: Integration with Picasso Network in June 2024 for IBC interoperability with Solana. Integration with Band Protocol’s Band Oracle for bridging RWA’s to IBC-integrated chains. Coreum’s V4 upgrade in July 2024, which introduced smart contract extensions to tokens, a clawback feature, and dynamic NFT data, among other updates. Completion of development of its native DEX in November 2024, which is undergoing a four-phase rollout. Users can already transfer between Coreum and the XRPL via the noncustodial Sologenic bridge. XRPL EVM Sidechain In Q2 2024, the Ripple team announced XRPL EVM Sidechain as the official name for Peersyst’s EVM sidechain proposal to bring smart contracts to the XRPL ecosystem. The sidechain aims to grant the XRPL ecosystem access to EVM developers and functionality, with a general-purpose scope. The sidechain is being built on the Cosmos SDK, specifically evmOS, and connects to the XRPL through the XRPL-EVM bridge. The devnet is currently live and is creating blocks every ~3.8 seconds using the Comet BFT PoS consensus mechanism, a variant of Tendermint. The latest version of Peersyst’s EVM sidechain was deployed on devnet V2 in Q2 2023. Dapps such as identity protocol XRPDomains were deployed on the testnet. Notable additions to the latest version include: Support for XRP, IOU, and ERC-20 token transfers via the bridge Proof-of-Authority consensus Smart contract verification on the block explorer Cosmos IBC interoperability was enabled in May 2024, allowing for tokens to be bridged from IBC-enabled chains to the XRPL. Additionally, the Ripple team announced in June 2024 that Axelar will replace the currently implemented bridge design proposed in the cross-chain bridges (XLS-38d) specification as the XRPL EVM Sidechain’s exclusive bridge. This will include sourcing the native gas token of the sidechain (eXRP) from the XRPL. Root Network The Root Network sidechain is a blockchain-based NFT system with a focus on UX and metaverse, run by Futureverse. The Root Network is live in alpha, along with its bridge to XRPL and Ethereum, which was upgraded in September 2024 to allow two-way bridging of any token between the XRPL and The Root Network. Additionally, in October The Root Network’s Asset Register Built from a Substrate fork, the Root Network uses XRP as the default gas token and has EVM support for smart contracts. The Root Network uses a delegated-Proof-of-Stake (dPoS) consensus mechanism (via the ROOT token). The protocol’s roadmap items are aligned with the XRPL, seeking to integrate the XLS-20 NFT standard and source liquidity from the XRPL DEX. Root Network also plans to offer users social recovery, management of assets, increased wallet flexibility, and a familiar Web2 experience through the account abstraction solution FuturePass. Hooks Hooks is a feature developed by XRPL Labs to include smart contract-like functionality for the XRPL transactions. While Hooks are not Turing complete and do not enable arbitrary logic, they do allow conditions and triggers to be attached to transactions — similar to scripts on UTXO chains like Bitcoin and Cardano (pre-Alonzo). In particular, Hooks enable several programmability features, including the scheduling of payments, distributing a set percentage of funds to a creator for royalties, or imposing limits/restrictions on transactions for both volumes and counterparties. In July 2024, the XRPL Labs team launched its latest testnet for Hooks written in JavaScript (JS), one of the most widely used programming languages. Governance The XRP Ledger (XRPL) uses an offchain governance process that allows community members and organizations to propose changes to the network. Users can submit proposals, otherwise known as Amendments, to the “XRPL-Standards” repository on the project’s GitHub. Block-producing validators on the network can then run versions of the XRPL source code that implement the proposed amendments. If 80.00% or more of the block-producing validators support the amended source code for two weeks, then it is implemented as the new source code for the network. Validators that do not support the amended source code are then blocked from contributing to consensus until they update to the newly changed version. Recent notable approved amendments include: Decentralized Identity (XLS-40): Enabled at the end of October, Decentralized Identity (DID) enables verifiable, self-sovereign digital identities on the XRPL for use cases in compliance, access control, digital signature, and secure transactions. Price Oracles (XLS-47): Enabled in November, this amendment brings price oracles to the XRPL for pricing wrapped/bridged assets. Anyone can now call OracleSet to create or update an existing price oracle or OracleDelete to delete an existing price oracle. Subsequently, oracle providers Band Protocol and DIA integrated with the XRPL in December. With oracles enabled, the get aggregate price API call aggregates the price of an asset from all live oracles while discarding any outliers. Additionally, some notable proposals that have yet to be approved include: Multi-Purpose Tokens (XLS-33): A proposal to introduce the multi-purpose token standard%20%2D%202.3%20Release) (MPT). MPT enables support for metadata to store parameters regarding an issued RWA, such as the maturity date of a tokenized bond. In October, Sofstack GmbH completed a comprehensive security audit%20SecurityAssessment22102024.pdf) for MPT. Coupled with the clawback function enabled in Q1 2024, the XRPL is continuing to add functionality to give regulatorily compliant token issuers more control. AMM Clawback (XLS-74): Currently, all tokens that have clawback enabled, such as RLUSD cannot be used on the AMM as clawback is not supported. This proposal would add support for clawback functionality to the AMM allowing such tokens to be used on the AMM. Simulating Transaction Execution (XLS-69): Proposes a new simulate API method for developers to safely experiment with transactions for testing and refinement. Permissioned Domains (XLS-80): This proposal introduced permissioned domains, which can only be accessed by users based on their Decentralized Identity (DID). Notably, this amendment builds on Onchain Credential Support (XLS-70), which was first proposed in Q2 2024 and also has yet to be enabled. XLS-70 would add support for creating, accepting, and deleting credentials on XRPL as part of identity management first introduced in Decentralized Identity (XLS-40), which was implemented at the end of October. In November, the XRP Ledger Foundation’s incorporation documents were filed in France, establishing a new entity to support the XRPL’s development and operations. Four founding members—XRPL Commons, XRPL Labs, Ripple, and XAO DAO—established the entity. In previous discussions, these supporting entities and others agreed to transfer previous XRPL Foundation assets to this new entity, which is governed via a board of directors that elects a President, Secretary and Treasurer for two-year terms and operates via committees. Additionally a General Assembly inclusive of community members including developers, users, academics, validators, and infrastructure providers can provide advisory input on decisions. As part of the transition process, the existing XRPL Foundation team established a new Inclusive Financial Technology Foundation (InFTF). Other Notable Updates A number of additional integrations, partnerships, and upgrades also took place in the fourth quarter, enhancing the XRPL ecosystem and the network’s overall utility. Peersyst launched XRPL Snap integrating the Metamask wallet with the XRPL. In October Ripple hosted its 8th annual Swell conference in Miami Florida highlighting four key themes (digital asset regulation, crypto ETFs and stablecoin growth, RWAs, crypto philanthropy). In December, Tenity announced its Tenity Inc Fund II to fund early-stage builders on the XRPL in Asia and Europe with Ripple as a strategic partner. Livenet explorer added support to search for specific tokens and issuers on the XRPL. Sologenic 2.0 launched with a new user interface to track and trade XRPL tokens. Xaman launched the 3.2 version of its wallet introducing memecoin data and tooling to hide spam. Additionally, Xaman integrated Topper’s off-ramp solution for its users in more than 120 countries to off-ramp XRP to US Dollars and Euros. Girin Labs launched its Girin Wallet on The Root Network in December. XRPL Community Support Programs The XRPL is supported by a number of community support programs funded by Ripple’s commitment of 1 billion XRP in March 2022. These programs include the XRPL grants program established in May 2021 to support development on the XRPL and the XRPL accelerator program, an accelerator for new and existing XRPL ecosystem projects. Other community support programs include XRPL Hackathons and the Aquarium Residency for developers offered by XRPL Commons. The RippleX Bug Bounty Program also pays bounties to individuals or groups that identify and report bugs in the rippled, xrpl.js, xrpl-py, and xrpl4j repositories. Notably, in May 2024, Ripple announced changes to the XRPL grants program including a revised screening criteria for applicants and rolling applications, among other changes. The XRPL Accelerator program had two tracks in 2024: the Launch Program for early-stage projects and the Scale Program for later-stage projects. The first Launch Program cohort was announced in July while the second Scale Program cohort began in September and concluded with a demo day in November hosted by the Dubai International Financial Centre (DIFC) Innovation Hub, which Ripple had previously announced a partnership with in July. Additionally, in September, the XRPL grants program introduced artificial intelligence (AI) as a new funding track. In August a partnership with APAC DAO to support developers building on the XRP Ledger in Southeast Asia was launched. In November, APAC DAO announced the winners of its XRPL SEA Hackathon. Closing Summary XRP’s market capitalization increased 246% QoQ, outpacing the combined market capitalization of BTC, ETH, and SOL, which increased by 44%. XRP Ledger network and ecosystem metrics also grew significantly. New addresses increased 382% QoQ to 507,000, suggesting the onboarding of new users, while Average daily CLOB volume and average daily AMM volume increased 1,140% (12x) and 3,100% (32x) QoQ. RLUSD, Ripple’s USD-pegged stablecoin, launched in December, bringing a stablecoin entirely backed by U.S. dollar deposits, short-term U.S. treasuries, and “other cash equivalents," to the XRPL. An amendment to support clawbacks on the AMM is also live that would allow trading of clawback-enabled tokens like RLUSD, likely spurring larger AMM volume. Key amendments were also enabled in the fourth quarter introducing decentralized identity, which enables verifiable digital identities, and price oracles for pricing wrapped/bridged assets. Additionally, a number of important updates and announcements were made. In November, the XRP Ledger Foundation’s incorporation documents were filed in France, establishing a new entity to support the XRPL’s development and operations. Also, a number of real-world assets (RWAs) were tokenized and issued on the XRPL in Q4 such as abrdn’s US Dollar Liquidity Fund (Lux) via Archax, and SG-FORGE announced plans to launch its EURCV stablecoin on the XRPL in 2025. In the new year, the XRPL is poised for further growth and activity as a continued stream of developments and upgrades brings additional users to the network.
Source: Matt Kreiser — Published: 2025-01-24T14:30:00ZState of Raydium Q4 2024
Key Insights Raydium averaged $3.2 billion in daily volume in Q4, up more than 29x year-over-year from roughly $110 million in the fourth quarter of 2023. Raydium’s share of global DEX volume increased more than 66% QoQ to over 17% as it flipped PancakeSwap to become the second-largest DEX by volume share in Q4, trailing only Uniswap. Q4 was Raydium’s second quarter in 2024 with the majority of Solana’s daily DEX volume and its third straight as the leader in daily DEX volume. In January, Raydium released its public beta for trading perpetual futures with no fees on maker trades and 2.5bps in fees on taker trades during the beta phase. Raydium Perps is powered by Orderly Network’s liquidity layer and features gas-free trading with up to 50x leverage on more than 70 trading pairs. In October, Raydium launched Burn and Earn support for its constant product market maker (CPMM) pools. Burn and Earn enables project teams to increase trust regarding liquidity provision by permanently locking liquidity while trading fees earned by the locked position remain fully claimable. Primer Raydium (RAY) is the largest automated market maker (AMM) decentralized exchange (DEX) on Solana. First launched in 2021, Raydium allows users to permissionlessly create new liquidity pools, provide liquidity to existing pools, swap tokens, and trade perpetual futures. Liquidity providers earn trading fees on each swap made in a pool as well as RAY (the protocol’s token) and/or other tokens if the pool is incentivized. RAY holders can also stake RAY to earn additional RAY tokens. In May 2024, the Raydium V3 application launched alongside revamped constant product market maker (CPMM) pools that support the Token-2022 token program and include a built-in price oracle. In addition to CPMM pools and its legacy standard AMM pools (AMM V4), which offer uniform liquidity distribution, Raydium offers Concentrated Liquidity Market Maker (CLMM) pools that allow for liquidity concentration at specific price points. CLMM provides lower slippage for traders and higher fee earnings for LPs, though the risk of higher impermanent loss is magnified by this design. Trading and routing are also available via the Raydium API. Website / X (Twitter) / Discord / Telegram Key Metrics Performance Analysis Volume and Market Share As the leading DEX on Solana, Raydium’s trading volumes are a key reflection of the network's overall activity. In Q4, daily average volume grew 265% QoQ to $3.2 billion and is up more than 29x year-over-year from roughly $110 million in the fourth quarter of 2023. While remarkable on its own, the growth in daily average volume in Q4 was particularly notable as last quarter (Q3) was the first quarter daily average volume on Raydium had declined in the last year compared to the previous quarter. Following the U.S. presidential election on November 5, 2024, daily volume surged and peaked at $7.7 billion on November 19. Thereafter, daily volume maintained above $2.5 billion each day for the remainder of the quarter, suggesting the establishment of a new base level in daily trading volume on Raydium. In the fourth quarter, Raydium’s share of Solana DEX volume was 56% (+18% QoQ), its second quarter in 2024 with the majority of Solana’s daily DEX volume and its third straight as the leader in daily DEX volume. Prior to March 2024, Orca was the leading DEX by volume on Solana largely because it was the first to offer concentrated liquidity pools, which were made fully available in April 2022. Concentrated liquidity pools provide lower slippage for traders and higher fee earnings for LPs, though the risk of higher impermanent loss is magnified by this design. Raydium made its Concentrated Liquidity Market Maker (CLMM) pools product fully available in November 2022. From March 6, 2024, onwards, Raydium has had consistently more daily volume than Orca. At this same time, the token launch platform Pump.fun began its rapid growth. Pump.fun simplifies the process for deployers, who need only select a name, ticker, and image to commence trading on a bonding curve for just a few dollars. On Solana, when enough users buy the token to reach a market capitalization of $69,000, $12,000 is then added to a standard AMM pool on Raydium, which supports asset pricing between zero and infinity. These pools and subsequent ones with tokens first launched on Pump.fun have generated significant trading volume on Raydium. Another catalyst came on March 26 when Raydium released its V3 user interface in beta. This interface introduced a new portfolio page for users to view and manage liquidity positions, a liquidity page that consolidates all Raydium liquidity pools in one place, support for exact swap amounts, and charts for all tradable token pairs. In May 2024, Raydium V3 fully launched alongside revamped constant product market maker (CPMM) pools that support the Token-2022 token program and include a built-in price oracle. Like Raydium’s legacy standard AMM pools, CPMM pools offer uniform liquidity distribution and asset pricing from zero to infinity. Volume share by token type is an important metric to understand which tokens are trending on Raydium. On an annual basis, meme volume share on Raydium is up more than 5x from 3.6% of trading volume in Q3 2023 to 19.1% in Q4 2024 (+32% QoQ). Additionally, AI tokens emerged in Q4 with a 143% increase QoQ in volume share. In contrast, the volume share of all other token types declined in the fourth quarter. This difference in volume share growth between the narratively hot categories of memes and AI compared to all other token types reinforces the commonly held view that attention drives trading activity in crypto, particularly on Solana. Outside of memes and AI, some notable tokens to first launch liquidity pools on Raydium in Q4 include Coinbase’s wrapped BTC token cbBTC, Circle’s Euro-pegged stablecoin EURC, Solayer Labs’ interest-bearing sUSD stablecoin, Orderly Network’s ORDER token, Magic Eden’s ME token, and Pudgy Penguins’ PENGU token. Raydium’s share of global DEX volume increased more than 66% QoQ to 17.5%. Only Lifinity had a larger increase in volume share among the top six global DEXs in the fourth quarter. Additionally, Raydium flipped PancakeSwap to become the second-largest DEX by volume share in Q4, trailing only Uniswap. Raydium’s increased volume share reflects both the relative strength of Raydium to other DEXs on Solana as discussed above, and Solana’s increasing share of DEX volume across all chains. In Q4, Solana's share of weekly DEX volume across all chains surpassed Ethereum every week, whereas in Q3 Solana only did so in three weeks. Solana’s flippening of Ethereum DEX volume marks a critical point in a trend that first emerged in December 2023 following airdrops like JTO that brought millions in liquidity to Solana spurring a wealth effect that resulted in a massive uptick in network activity. Financial In the fourth quarter, RAY’s circulating market cap increased 190% QoQ to $1.4 billion. Year-over-year, RAY’s market cap is up more than 4.5x from $313 million at the close of Q4 2023. Likewise, daily average fees are up more than 33 times year-over-year from an average of $210,000 in Q4 2023 to $7 million. This growth in daily average fees is approximately in line with daily average volume (discussed above), which is up 29 times year-over-year from an average of 109.6 million in Q4 2023 to $3.2 billion. In contrast, in the first three quarters of 2024, RAY’s market cap remained relatively flat even as the protocol collected increased fees relative to trading volume. On Raydium, the RAY token has a number of functions. Stake RAY to earn RAY: RAY holders can stake RAY to earn additional RAY tokens at an APR of approximately 5%. RAY Liquidity Provision Rewards: Liquidity providers can earn RAY when allocated by the project team to reward liquidity providers in a particular pool. Pools incentivized with RAY and/or a third-party token can easily be seen on Raydium’s Liquidity Pools page. Other RAY Rewards: The protocol may also offer other ways to earn RAY at its discretion. For example, during the public beta phase of Raydium Perps, anyone can submit UI/UX bugs to earn RAY with one participant each week earning 50 RAY, ten participants earning 10 RAY, and 50 participants earning 5 RAY. Additionally, Raydium’s bug bounty program can pay rewards in RAY, SOL, or USDC on Solana. Governance: Raydium has an offchain governance process facilitated via Realms, where users must deposit RAY to participate. A minimum of 1.00 million RAY is required to create a proposal, while each token equals one vote for active proposals. As of the close of Q3, there have been two proposals. Of RAY’s 555 million maximum supply, 188.7 million RAY (34%) is allocated to a mining reserve, with ~1.9 million emitted each year. At the end of Q4, approximately 291 million RAY (52% of the maximum supply) was circulating. The project’s documentation states%20were%20fully%20locked%20for%20the%20first%2012%20months%20after%20TGE%20and%20unlocked%20linearly%20each%20day%20over%20months%2013%20%2D%2036.%20Vesting%20concluded%20on%20February%2021%2C%202024.) that the “Team” and “Seed” allocations, which together make up 25.9% of the maximum supply, fully vested in February 2024. Additionally, the documentation states “The majority of the locked supply remains allocated to the Mining Reserve, Partnership & Ecosystem, and Advisors.” Together these allocations make up 66% of the maximum supply (366.3 million RAY). In the fourth quarter, a record $55 million in USDC (+245% QoQ) generated from protocol fees was spent buying back RAY from the open market. This resulted in a record 13.1 million RAY bought back in Q4 (+49% QoQ), even as the price of RAY increased from $1.85 to $4.88 (+164%) QoQ. On Raydium, pool creators can select the pool’s trading fee from a number of fee tiers depending on the pool type: Standard AMM (AMM V4): 0.25% Concentrated liquidity (CLMM): 0.01%, 0.02%, 0.03%, 0.04%, 0.05%, 0.25%, 1%, 2% Constant Product (CPMM): 0.25%, 1%, 2%, 4% For all pool types, 12% of the fee is allocated to RAY buybacks. Trading fees allocated to buybacks are automatically claimed when the value reaches $10 and transferred to intermediary wallets%20pools%3A%20ProCXqRcXJjoUd1RNoo28bSizAA6EEqt9wURZYPDc5u) to “programmatically” buyback RAY. For AMM V4, the remaining 88% of the fee is distributed to the pool’s liquidity providers pro rata, while for CLMM and CPMM it is 84%, with the remaining 4% allocated%20pools,final%204%25%20to%20treasury.) to the treasury. Treasury fees for CLMM and CPMM pools are automatically swapped to USDC and held in treasury accounts controlled by the protocol multsig. 5.0 million was deposited to the treasury in Q4, a 775% increase from the $568,000 deposited in Q3, and 5x the previous all-time high of $1 million deposited in Q2. On Jan. 1, 2024, a trial pool creation fee of 0.68 SOL was instituted for standard AMM pools to prevent pool spamming. This pool creation fee was reduced to 0.4 SOL on Feb. 16, 2024, while a 0.15 SOL fee was implemented for CPMM, which fully launched in May (there is no pool creation fee for CLMM). Fees are held in accounts controlled by the protocol multisig and reserved for protocol infrastructure costs. By the end of 2024, Raydium had generated more than 204,000 SOL in pool creation fees. Qualitative Analysis Raydium Perps Public Beta Launch On January 10, 2025, Raydium released its public beta for trading perpetual futures, a type of derivative contract that allows traders to speculate on an asset’s price without an expiry date. Raydium Perps is powered by Orderly Network’s liquidity layer and features gas-free trading with up to 50x leverage on more than 70 trading pairs. During the beta phase there are no fees on maker trades and 2.5bps in fees on taker trades charged by%20fee%20and%20a%201%20USDC%20flat%20withdrawal%20fee.) Orderly Network. To begin trading, prospective users can connect a Solana wallet, register and generate an API Key, and deposit USDC, the only accepted form of collateral. Notably, a swap and bridge feature to deposit any asset converted to USDC collateral is intended for future release. Also during public beta, anyone can submit UI/UX bugs to earn RAY with one participant each week earning 50 RAY, ten participants earning 10 RAY, and 50 participants earning 5 RAY. Teleport On Oct. 2, 2024, Raydium announced the launch of Teleport, a new feature enabling token transfers from EVM networks to Solana. Teleport integrates Circle’s Cross-Chain Transfer Protocol (CCTP) for the stablecoin USDC via CCTP’s native mint and burn mechanism, as well Wormhole Connect, a React widget for cross-chain asset transfer via Wormhole. Burn and Earn Launch On Sept. 11, 2024, Raydium launched Burn and Earn, which allows any liquidity provider to permanently lock the NFT representing the underlying position while all trading fees earned by the position remain claimable. In doing so, Burn and Earn enables project teams and token creators to increase community trust regarding liquidity provision while still allowing for the claiming of fees. Initially, Burn and Earn only supported CLMM pools. Support for CPMM was added on Oct. 23, as were transferable NFTs for fee claiming of underlying locked positions. Transferable NFTs are minted to the wallet that locked the position, and are “meta-agnostic,” allowing the NFT holder to distribute or transfer fee-claiming rights. API support is also enabled for users and third parties seeking to track burnt liquidity for any pool (CLMM or CPMM). New Fee Tiers On Aug. 1, 2024, the protocol introduced additional fee tiers of 0.02%, 0.03%, 0.04%, 2% for CLMM (concentrated liquidity market maker) and 1%, 2%, and 4% for CPMM (constant product market maker). For both CPMM and CLMM, 84% of the trading fee for each swap goes to liquidity providers, 12% to RAY buybacks, and 4% to the treasury. The 4% allocated to the treasury is automatically swapped to USDC and transferred to two accounts controlled by the protocol multisig. Blinks On July 1, 2024, Raydium announced support for creating Blockchain Links (Blinks) for all assets. Blinks are shareable links that convert Solana Actions into metadata-rich URLs and were first launched by the Solana Foundation in partnership with Dialect at the end of Q2. On the Raydium website users can copy their unique trading link and earn 1% rewards in SOL when it’s used on “X” (Twitter) with Blink to complete a trade. The referral fee is part of the transacting user’s swap from SOL and then sent to the referrer account. Integrations, Partnerships, and Upgrades Raydium has made significant strides in expanding its ecosystem and enhancing its utility through a series of strategic integrations, partnerships, and upgrades: UNCX Network Integration (Oct. 11) - UNCX Network, a multichain service provider, integrated Raydium’s “Burn and Earn” feature, which allows users to lock liquidity. Moonshot Integration (Oct. 16) - Moonshot announced its OpenBook Market savings now go directly to the developer for migrations to Raydium. Wasabi Protocol Integration (Nov. 15) - Wasabi Protocol, a spot leverage DEX, announced settlement of its leveraged trades on Raydium. GoPlus Security Integration (Nov. 15) - GoPlus, a user security network, integrated Raydium’s Burn and Earn token locking feature to its Solana Token Security API. Krystal Integration (Nov. 26) - Krystal, a liquidity launchpad and management tool integrated Raydium. Rugcheck Integration (Dec. 7) - RugCheck, a tool for avoiding token scams and rugs, added Raydium’s Burn and Earn token locking feature to its tool that allows users to assess a token’s risk factors. Definitive Integration (Dec. 11, 2024) - Definitive, a trading platform that offers gas-free trading and advanced order types, integrated Raydium RAY Listings - In Q4, RAY was listed by the exchanges HTX (Dec. 7) and Bithumb (Nov. 19). Drift, a perpetual futures exchange on Solana, also added RAY perpetual futures on Dec. 3. Closing Summary Raydium averaged $3.2 billion in daily volume in Q4, up more than 29x year-over-year from roughly $110 million in the fourth quarter of 2023. Q4 was also Raydium’s second quarter in 2024 with the majority of Solana’s daily DEX volume and its third straight as the leader in daily DEX volume. Moreover, Raydium’s share of global DEX volume increased more than 66% QoQ to over 17% as it flipped PancakeSwap to become the second-largest DEX by volume share in Q4, trailing only Uniswap. Additionally, new features and upgrades were made to improve the protocol’s functionality and user experience. Key among them, Raydium released its public beta for trading perpetual futures with no fees on maker trades and 2.5bps in fees on taker trades during the beta phase. Also, Raydium launched its Burn and Earn feature for constant product market maker (CPMM) pools, which allows pool creators to increase trust by permanently locking liquidity while trading fees earned by the locked position remain fully claimable. From becoming the leader in daily DEX volume on Solana in Q2 to capturing the majority of Solana’s daily DEX volume in two quarters, 2024 was a year of massive growth for Raydium. Looking to 2025, Raydium is positioned well as it aims to surpass Uniswap and become universally recognized as the number one DEX by volume share across all chains.
Source: Matt Kreiser — Published: 2025-01-23T15:00:00ZState of Core Q4 2024
Key Insights Core’s DeFi TVL (USD) increased by 90% QoQ to $811.8 million. Avalon Labs topped the leaderboard for DeFi TVL, followed by Colend and Pell Network, which launched BTC restaking on Core in August. CORE and BTC Staked (USD) increased by 31% QoQ to $730.5 million. The increase was primarily due to 500 BTC staked through Core’s non-custodial BTC staking product, launched in April. Average daily active addresses increased 160% QoQ to 249,700. At the end of Q4, Core finished with a cumulative total of 34.8 million unique wallets. Core released the Fusion Upgrade in Q4, launching Dual Staking and introducing LstBTC. In Q4, 1,298 BTC and 16.5 million CORE were dual-staked, representing 22% of all BTC and 19% of all CORE staked on the Core network. Primer The Core blockchain (CORE) is a Proof-of-Stake (PoS) Layer-1 for Bitcoin, differentiated by its Non-Custodial BTC Staking product, EVM execution environment, and Bitcoin DeFi ecosystem. Launched in early 2023, the Core community is building an ecosystem of Bitcoin-focused applications, leveraging Bitcoin security via its Satoshi Plus consensus mechanism, which leverages Bitcoin miners, BTC stakers, and CORE stakers. Satoshi Plus consensus involves staking and hash rate delegation from Bitcoin miners. Staking includes both the native CORE token and BTC. This combination of security resources results in a hybrid model that leverages Bitcoin mining, rewards miners, and separates block production to mitigate censorship and MEV risks. The network's EVM compatibility allows Core to run smart contracts and applications by leveraging existing Ethereum developer tools and the Ethereum ecosystem. In Q2 2024, Core introduced non-custodial BTC staking for users to earn yield and contribute to consensus on the Core Network. The Fusion Upgrade introduced higher rewards via Dual Staking of BTC and CORE and LstBTC, a BTC liquid staking token, enabling users to access yield-bearing BTC liquidity in Core's fully expressive execution environment. For a complete primer on Core, refer to our Initiation of Coverage report. Website / Twitter / Telegram Key Metrics Financial Analysis CORE is the native token of the Core blockchain and is used as the primary medium of exchange when transacting on the network. CORE has four primary use cases: Paying transaction fees. Staking to secure the network and earn rewards. Boost BTC-staking yield rates via Dual Staking. Participating in onchain governance. The total supply of CORE is 2.1 billion tokens, with block rewards distributed over 81 years. CORE also has a minor deflationary burn mechanism aimed to counteract inflationary pressure. Additionally, block rewards decrease by 3.6% annually. Market Cap & Fees Core fees denominated in USD increased by 97% QoQ to $234,500. Core’s fees come from transactions on the networks. This quarter's notable increase in revenue was correlated with a 92% increase in transaction fees. Core fees denominated in USD increased by 218% YoY, while fees denominated in CORE increased by 52%. A 91% YoY increase in the price of CORE is responsible for the discrepancy. Core’s market cap increased by 6% QoQ to $981.1 million, while its price increased by 4% QoQ to $1.05 in Q4. A 3% increase in the circulating supply of CORE is the reason for this discrepancy. Core’s price movement tracked the altcoin market, with a high correlation to popular Layer-1s and Bitcoin sidechains such as Stacks and Merlin Chain. Token Supply In Q4, 24.7 million CORE tokens were unlocked. Of the token unlocks, 17.0 million were for airdrop participants, 7.7 million were for validator rewards, and 30,900 were for relayers. Airdrop participants will be vested with 484.9 million CORE by January 2025. Block rewards decrease by 4% annually, extending the emissions schedule and maintaining deflationary pressure. Rewards for relayers and validators will continue to be distributed over 81 years. In Q1 2025, contributor tokens will begin unlocking for the first time, with 6.6 million tokens scheduled to unlock in January. Network Analysis In Q4, average daily active addresses increased 160% QoQ to 249,700, and average daily transactions increased 92% to 549,400. From Q4’23 to Q1’24, inscription activity spiked, causing increases in the number of average daily transactions and average active addresses. Inscription activity began to decline by late January. The growth in daily active addresses is underscored by a 92% increase in transactions to 549,500 in Q4. Additionally, Core reached 34.8 million unique wallets in Q4, a 59% increase QoQ. Average daily new active addresses increased 576% to 123,800. On an annual basis, average daily new addresses are up 4,861% YoY, a positive signal for network and downstream ecosystem growth. In Q4, the average block time on Core was only 3 seconds, whereas the average block time on Bitcoin was 10 minutes. Core is not limited by Bitcoin’s block time and can execute at an independent pace in any instance since it executes on the Core network. In Q2, Core announced the passing of CIP-2, which outlines the expansion of Core’s active validator set from 21 to 31 by Q2 2025. Currently, Core uses its Validator Election mechanism to rank the top 27 validators based on a weighted score of their hash and stake (CORE and BTC), creating the validator set for a consensus period of 200 slots, known as an epoch. Staking Core uses the novel Satoshi Plus consensus mechanism. Satoshi Plus is a hybrid model of Delegated Proof-of-Work (DPoW), Delegated Proof-of-Stake (DPoS), and Non-Custodial BTC Staking. Unlike merge-mined sidechains, Core validators, rather than Bitcoin miners, are responsible for mining new blocks. Total CORE and BTC staked denominated in USD was $730.5 million in Q4, a 31% increase QoQ. CORE staked (USD) was down 11% QoQ to $176.8 million, equivalent to a decrease of 9.2 million CORE tokens in Q4. CORE staked peaked on December 1 at $309.8 million. BTC staked (USD) increased by 57% QoQ to $359.1 million, equivalent to an additional 500 BTC tokens in Q4. BTC is staked on Core through Non-Custodial BTC Staking, which allows users to lock their BTC tokens on the BTC network and contribute to Core’s network security through consensus. stCORE, Core’s native liquid staking product, launched in January 2024. stCORE enables CORE stakers to participate in DeFi and other yield opportunities while contributing to the Core blockchain. stCORE ended Q4 with $13.2 million TVL, a 13% decrease QoQ. This comprises roughly 12 million CORE tokens, approximately 7% of all staked CORE. Consensus Core has multiple validators (M Labs, InfStones, OKXEarn, etc.) participating in Satoshi Plus consensus. In Q4, two new validators joined Core: Foundry Services: Foundry is a digital assets infrastructure company that provides services such as mining operations, staking solutions, and strategic consulting. Figment: Figment is a blockchain infrastructure company that provides tools, APIs, and staking services to simplify onchain access to blockchain technology. In Q4, Core had up to 75% of the delegated hash rate from BTC miners on multiple occasions. Core leverages the large pool of computing power to promote decentralization and enhance security on its network. Core has stated they will have 31 validators by Q2 2025; as of Q4, there are 27 validators on the network. Fusion Upgrade On November 19, Core released the Fusion Upgrade, which introduced Dual Staking to align BTC stakers with the CORE token. The upgrade also introduced liquid BTC staking, allowing BTC stakers to use a liquid, yield-bearing BTC-pegged token (LstBTC) within BTCfi. Dual Staking Dual Staking provides higher BTC staking rates to participants who stake both Bitcoin and CORE tokens (“dual stakers”), incentivizing BTC stakers to acquire and stake CORE to maximize their yield. Dual Staking further aligns the utility of BTC and CORE tokens by leveraging CORE to boost yield for BTC staking. This alignment aims to enhance Core’s security by raising economic incentives to stake BTC and CORE. The staking process remains unchanged, but reward allocation now follows a tiered system. Previously, all BTC stakers received the same rewards rate, but under Dual Staking, rewards tiers are determined by the amount of CORE staked relative to BTC staked. The more CORE staked relative to BTC staked, the higher the rewards in that tier. While staking CORE introduces risks beyond holding BTC, the principle BTC holdings remain unaffected, ensuring that Dual Staking enhances yield without compromising Bitcoin’s fundamental security. 1,298 BTC and 16.5 million CORE have been dual-staked as of December 31. 22% of BTC stakers are also staking CORE, while 19% of CORE stakers also stake BTC. Most BTC and CORE Dual Stakers have staked at the highest possible tier (Satoshi) for maximum rewards. Liquid Staking BTC LstBTC is an upcoming liquid staking token issued on the Core network representing staked BTC. Traditionally, BTC holders on Core had to choose between earning staking yield via non-custodial BTC staking or using their BTC within Core’s BTCfi ecosystem. LstBTC is Core’s native solution to offer users staking yield and liquidity on their BTC. LstBTC is pegged 1:1 to BTC, and yield is generated as CORE tokens. LstBTC also supports network consensus by further decentralizing staking. Core DAO is sunsetting coreBTC, the first Core-native bridged BTC wrapper, in tandem with the launch of LstBTC. Existing coreBTC in circulation will remain fully redeemable, and collateral assets can be used to mint LstBTC or other bridged BTC assets on Core. LstBTC's future success lies in delivering BTCfi yield opportunities while maintaining the liquid utility enjoyed by other pegged BTC assets in the Core and broader EVM landscape. Core announced plans for several opportunities for users to earn BTCfi yield on their LstBTC, including lending, borrowing, staking, perpetual futures, DEX trading, and NFT trading. LstBTC must capture market share from competition such as WBTC, cbBTC, and even native liquid BTC assets like Solv.CORE. Ecosystem Analysis In Q4, Core added 20 new apps to its ecosystem. The most notable integration was BitFLUX, which offers low-slippage swaps between Bitcoin-pegged assets. As of Q4, Core has 94 dApps listed on its ecosystem page. DeFi diversity represents the number of protocols that make up 90% of DeFi TVL. Core’s DeFi diversity was 5 in Q4; TVL was concentrated in Avalon Finance, Pell Network, and Colend. DeFi Avalon Labs (previously Avalon Finance), a decentralized lending protocol, flipped Colend for the top DeFi TVL spot on Core in Q4. Avalon ended Q4 with $260.8 million TVL, a 13,539% increase QoQ. Avalon’s TVL on Core mostly comes from SolvBTC.b, a Free Tech bridged BTC wrapper. Colend, a lending and borrowing platform native to Core, had $224.9 million TVL in Q4, a 3% increase QoQ. Most of Colend’s TVL increase came from users supplying SolvBTC.m, a bridged version of BTC from Merlin Chain, and CORE. Colend launched a points program with an airdrop that went live in November. Pell Network, a Bitcoin restaking layer, followed Colend as the third largest dApp with $220.3 million TVL in Q4, a 38% increase QoQ. Pell Network launched on Core in August, offering users higher yields for restaking coreBTC or SolvBTC, among other BTC derivatives. Obelisk’s oBTC is the largest restaked asset for Pell on Core, with a TVL of $130.1 million. DEX Volume Core had an average daily DEX volume of $2.5 million in Q4, a 266% increase QoQ. DEX Volume maxed out at $5.1 million on November 30. DEX volume increases on Core coincided with market-wide DEX volume increases across DeFi in Q4. The most popular DEX on Core was SushiSwap, followed by GlyphV4. Ecosystem and Growth Two mutually reinforcing offerings define the Core ecosystem: Bitcoin Yield Product EVM-Compatible BTCfi Platform Non-custodial BTC staking secures the Core network and delivers yield to Bitcoin holders. The yield is sourced from Core’s BTCfi platform, providing an endogenous source of Bitcoin value creation. The Core network uses the EVM, which means it can leverage Ethereum’s infrastructure and ecosystem for expansion. Core integrates with wallets like MetaMask, developer tooling like Hardhat, and DEXs like SushiSwap. This familiarity reduces the development overhead and has other benefits, such as reducing the risk of exploits. Core’s ecosystem developers can leverage the learnings of EVM development on Ethereum, Arbitrum, Avalanche, and other EVM chains. Valour, the asset management arm of DeFi Technologies, leveraged the Core blockchain to introduce the first yield-bearing BTC exchange-traded product in June. It’s available to German investors on the Börse Frankfurt, the largest German stock exchange. Valour generates yield by delegating BTC to their validator node on Core through the non-custodial BTC staking feature. The yield is attributed daily to the Net Asset Value, providing investors yield without selling or trading their BTC holdings. In Q4, DeFi Technologies announced the upcoming launch of CoreFi Strategy, a company applying MicroStrategy’s investment methodology to the Core network. This company will deploy capital to acquire BTC and CORE tokens, stake and borrow against those assets, and continue to grow its exposure to Core’s BTCfi ecosystem. The goal is to provide investors with a regulated pathway to BTCfi exposure. Core Commit Program The Core Commit Program is a three-month program designed to encourage developers to build on Core. Developers can receive support from the Core ecosystem, 1:1 mentorship, and funding from Core Ventures. This initiative marks Core Ventures’ first effort to incubate a cohort of developers aimed at onboarding additional native dApps to the ecosystem. The program kicked off on December 9, and Core Ventures selected 10 teams to participate and receive support: 0xBridge Focus: BTCfi, DeFi B14g Focus: BTCfi, BTC Staking Bitcoin Derby Focus: Game, BTCfi BQLabs Focus: Insurance, DeFi Celeriz Focus: BTCfi, Stablecoins, Infrastructure Coffer Network Focus: Infrastructure, BTCfi Degen Markets Focus: SocialFi Ordinistan Focus: Ordinals, NFTs, BTCfi, DeFi Sats Terminal Focus: BTCfi, Ordinals/Runes, DeFi, Infrastructure 10. VaultLayer Focus: BTCfi, LSTs Sparks Incentive Program In May 2024, Core DAO updated the Core Ignition Incentive Program to introduce Sparks, the network’s way of measuring user activity and engagement. Sparks are synonymous with the points several popular pre-airdrop protocols began offering the past year. Users receive a daily allocation of Sparks, determined by their level of engagement and participation in the Core ecosystem. The more active and involved a user is, the greater their daily allocation of Sparks will be. Additionally, Core offers a multiplier on specific assets that adjusts your conversion rate (i.e., if you hold an asset with a 1.5x multiplier and earn 100 base Sparks a day, you'll receive an additional 50 Sparks through the asset multiplier, totaling 150 Sparks for the day). In September, Core launched Season 2 of the Ignition Program. Sparks reset to 0 for all participants. Season 2 introduced new campaigns and ways to earn Sparks through Core network dApps, bridging, and trading. To track Spark Points, Core recently launched an Ignition Leaderboard. Other Key Developments Several other key developments and initiatives took place in Q4: SolvBTC.CORE launched (October 1): Solv Protocol launched SolvBTC.CORE is a yield-bearing liquid staking token for Bitcoin holders on the Core network. 500 SolvBTC.CORE was minted in under 2 hours after launching. Hashnote Integration (December 2): The Hashnote integration with Core enables institutions to earn yield through non-custodial BTC staking and Dual Staking with CORE. Hashnote is a regulated asset manager built for traditional finance managers. BitGo enables BTC yield with Core (December 8): BitGo announced a partnership with Core to offer secure institutional yield services for Bitcoin liquidity. The collaboration aims to provide institutional-grade custody and enhanced yield through Dual Staking of BTC and CORE. Cactus Custody integration (December 13): The Cactus Custody integration, an institutional-grade platform offered by MatrixPort, enables institutions to earn yield through non-custodial BTC staking and Dual Staking with CORE. MatrixPort is a digital assets platform with Bitcoin mining relationships. Coretoshis NFT Launch (December 14): Coretoshis is a 3,333 PFP NFT project launched by Core DAO. The collection sold out in under 60 seconds during its public sale on OKX Marketplace. Closing Summary Core recorded a 90% QoQ increase in DeFi TVL to $811.8 million in Q4 2024 and implemented the Fusion Upgrade, launching Dual Staking and introducing LstBTC to enhance BTC staking yields and liquidity. Ecosystem activity increased, with average daily active addresses rising 160% QoQ to 249,700 and the number of unique wallets growing to 34.8 million, a 59% QoQ increase. Staking activity also grew, with BTC staked increasing 57% QoQ to $359.1 million. In the coming quarters, Core’s trajectory will be influenced by new features like LstBTC and Dual Staking and its ability to attract developers and dApps through initiatives such as the Core Commit Program. Institutional collaborations, including those with BitGo and Cactus Custody, may further integrate Core and BTCfi into institutional finance.
Source: Sam Ruskin — Published: 2025-01-23T14:00:00ZPayFi Ecosystem Analysis
Key Insights PayFi (short for Payment Financing) leverages a six-layer infrastructure stack to create scalable solutions for global payment financing challenges. Stablecoin adoption is surging, with the total market cap growing 57% from $130 billion to $204 billion and monthly transfer volume increasing 148% from $1 trillion to $2.6 trillion in 2024, showcasing a strong foundation for onchain payment solutions. The financing layer within PayFi is rapidly maturing; monthly payments financed by Huma and Arf grew 116% from $63 million to $136 million in 2024, underscoring its increasing relevance for businesses globally. Emerging PayFi use cases, such as T+0 settlement and DePIN financing, transform how traditional industries can improve cash flow, reduce settlement delays, and open new opportunities for businesses of all sizes. Regulatory clarity and DeFi composability are critical for PayFi’s expansion in 2025, as the ecosystem aligns with global standards to unlock liquidity and foster institutional participation. Introduction Payment financing operates on the principle of the time value of money, which means that a dollar today is worth more than a dollar in the future. Money received today can be invested in a business or market to generate additional value over time. Payment financing is already a cornerstone of the traditional financial system, ingrained in everyday life, and vital to global economic growth. Examples of existing payment financing markets include credit cards, with a global transaction market of $16 trillion in 2023, and trade finance, which supports the $89 trillion market of global business-to-business payments. Remittances are another critical example, with 1 in 7 people globally relying on cross-border payment remittances, either by sending or receiving them. However, enabling remittances requires $4 trillion in pre-funded liquidity to support settlements, demonstrating the capital inefficiencies in current systems. Despite its importance, traditional payment financing systems face significant challenges: Slow: cross-border payments can take several business days to settle. Expensive: sending remittances can incur high fees (averaging 7% globally). Inaccessible: many individuals who want access to these services, including 1.4 billion unbanked people globally, are denied due to geographical limitations, lack of identification, or insufficient income. These inefficiencies highlight the need for more effective solutions. PayFi, short for Payment Financing, makes essential financial use cases—such as credit, trade finance, and remittances—more accessible, secure, and efficient onchain. By leveraging blockchain technology and stablecoins, PayFi reduces settlement times and transaction costs. Solutions related to PayFi unlock greater access to payment financing for businesses and individuals across global markets. In addition to improving existing systems, PayFi creates new markets that allow for entirely new financial use cases that were not possible before. This enables developers to design innovative financial solutions that streamline value exchange and reduce settlement latency. Real-world assets (RWAs), such as stablecoins and tokenized invoices, serve as the medium of exchange within the PayFi ecosystem. These assets allow businesses to access liquidity, transact efficiently, and capitalize on opportunities in ways that traditional systems cannot match. The PayFi ecosystem provides the technological infrastructure to build financial primitives that address longstanding inefficiencies in traditional payment financing systems. By enabling new and existing use cases, PayFi expands financial accessibility and drives economic growth on a global scale. PayFi Use Case Examples PayFi applications address inefficiencies in traditional financial systems and unlock new opportunities. From enabling T+0 settlements to facilitating DePIN financing, the use cases below demonstrate PayFi's transformative potential across various industries. Digital Asset-Backed Credit/Debit Cards Digital asset-backed credit cards are a prime example of how PayFi applications enable innovative financial solutions. One such application is Rain, which provides USDC-backed corporate cards tailored to Web3-native teams. In Rain’s model, corporate treasuries deposit their USDC into a vault, determining their credit limit. At the end of each billing cycle, the balance is settled automatically through onchain liquidation, ensuring transparency and efficiency. While Rain relies on USDC and vault-based operations, other solutions can be collateralized by any stablecoin supported in the currency layer or even blue chip crypto assets like Bitcoin or Ethereum. Furthermore, not all payment solutions require a vault-based mechanism. Some systems like Kulipa integrate directly with self-custody wallets, enabling users to maintain control of their funds while accessing Web2 debit card capabilities. The adoption of low-latency blockchains has bolstered these flows, in many cases allowing funds to be locked at the point of card authorization while maintaining a self-custodial environment. The Solana protocol enables the use of Program Derived Addresses (PDAs) to support this use case, allowing a program to sign for the user in real-time. These flexible models cater to various business needs, reducing reliance on traditional banking infrastructure. Digital asset-backed credit and debit cards represent a growing use case within PayFi that combines financial inclusivity with cutting-edge payment technology. These cards leverage blockchain for settlement liquidity and incorporate diverse collateral options. Cross-Border Payment Financing Cross-border payment financing is a transformative solution addressing the inefficiencies of traditional banking rails, such as correspondent banks and SWIFT, which often delay transactions for several days. To meet the demand for same-day settlements, payment companies typically pre-deposit funds in destination countries, a process known as pre-funding. While effective in ensuring liquidity, pre-funding ties up working capital, limits business growth, and introduces financial risks, with an estimated $4 trillion locked in pre-funded accounts globally. PayFi applications provide a modern alternative by offering onchain liquidity solutions that enable real-time, cost-effective settlements. Leveraging stablecoins like USDC, these solutions allow licensed financial institutions to bypass the need for pre-funding by settling payments near-instantly and transparently on the blockchain. This model reduces operational costs and unlocks capital, enabling companies to invest in growth and scale their operations without additional working capital. For example, Arf provides licensed financial institutions with short-term, revolving, and USDC-based credit lines for cross-border payments. This lets them settle with international partners in real-time while avoiding pre-funding challenges. Cross-border payment financing showcases how PayFi solutions leverage blockchain to streamline liquidity management, improve operational efficiency, and deliver faster, more flexible financial services. Trade Finance Trade finance is a cornerstone of global commerce, enabling businesses to access short-term funding to support operations and growth. Traditionally, these services rely on financial institutions that may deny access due to limited credit history or inadequate financial infrastructure, particularly in underdeveloped regions. PayFi addresses these barriers by allowing businesses to tokenize invoices or future income streams, using them as collateral to secure immediate funding. This approach democratizes access to capital while reducing dependency on traditional lending systems. One example of blockchain-based trade finance innovation is Tether’s Trade Finance initiative. Recently, Tether financed a $45 million crude oil transaction in the Middle East, using USDT to expedite settlement and reduce costs. This demonstrates blockchain’s ability to modernize global trade flows by lowering costs, accelerating payment times, and improving transparency. Leveraging tokenized assets and blockchain infrastructure, PayFi creates a more accessible and efficient trade finance ecosystem, unlocking new opportunities for businesses of all sizes and positioning itself to transform the industry. T+0 Financing Even highly liquid RWAs like Treasury Bills can take two to three days to settle due to delays in liquidating underlying assets. PayFi applications address this inefficiency by leveraging liquidity pools to front redemptions, enabling settlement within the same day (T+0). The liquidity pools are reimbursed once the underlying asset is fully settled, offering a fast and transparent solution for these transactions. This capability can transform global payment flows. For instance, companies with complex international supply chains, such as Amazon, often face delays when transferring funds across multiple jurisdictions (i.e., U.S. to U.K. to Hong Kong to China). PayFi solutions eliminate these bottlenecks, allowing suppliers to receive payments without multi-day lags. Similarly, fiat-to-stablecoin conversions on exchanges and payment platforms can benefit from T+0 settlements, significantly improving the payment experience for businesses and institutions. DePIN Financing DePIN projects operate on the principle that the cost of building large-scale infrastructure can be distributed among individuals in exchange for future value redistribution. These projects often require upfront costs for contributing resources like bandwidth or hardware to the network and high micro-transaction volumes to compensate participants. PayFi offerings can streamline the financial processes behind DePIN projects by enabling financing options and fast, low-cost micro-transaction settlement. For example, a project like Roam, which focuses on decentralized Wi-Fi networks, can benefit. Users can use the Roam Loan program to purchase a Roam Wi-Fi router miner and repay their loan balance using mining rewards. This process is enabled in two ways: through a 30% stablecoin down payment with the remaining 70% loaned by Huma Finance or with a 4 SOL deposit requirement and a 100% loan financed by Roam or Huma. Users are then repaid their principal amount and interest via Roam airdrops and mining rewards. Once the loan is fully repaid, users gain full ownership of the router and can start earning full rewards from providing the DePIN service. These loans are repaid seamlessly through mining rewards and Roam airdrops, making participation accessible and incentivizing contributors. By facilitating timely repayments and enabling full ownership of the hardware after the loan is repaid, PayFi plays a critical role in supporting the growth and sustainability of DePIN ecosystems. Open PayFi Stack x PayFi Ecosystem The PayFi ecosystem can be thought of as a six-layer technology stack, initially proposed by Huma Finance, each serving a distinct function to facilitate efficient and compliant payment financing solutions. The Open PayFi stack provides a blueprint for collaboration across well-defined layers while maintaining openness and flexibility. This approach is inspired by the early days of the Internet when networks were isolated, closed, and unable to communicate. The introduction of the OSI model—a seven-layer framework—enabled composability and interoperability, paving the way for countless innovations that are now globally accessible. Similarly, the Open PayFi stack aims to establish a modular, open network architecture for payment financing, accelerating adoption and enabling new use cases without requiring every ecosystem player to operate under the same infrastructure. Copilot Insights: What is the PayFi six-layer infrastructure stack? Transaction Layer The foundation of the PayFi stack ensures high throughput, low transaction costs, and rapid settlement—essential attributes for effective payment processing. Blockchain platforms such as Solana and Stellar are optimized for these requirements, offering solutions such as Solana Pay and the Stellar Disbursement Platform to enhance payment efficiency. Solana Solana’s high-performance, highly scalable architecture makes it well-suited for PayFi. The network can process up to 65,000 transactions per second (TPS), typically costing between $0.0024 and $0.048 per transaction. This efficiency enables near-instant settlement times, which is essential for high-frequency use cases such as retail payments, e-commerce transactions, and real-time cash flow management. Solana achieves this performance through its unique parallel transaction processing, which allows multiple transactions to be verified simultaneously—eliminating network bottlenecks and ensuring consistent scalability as adoption grows. Solana also supports a permissionless, borderless infrastructure, allowing developers to build and deploy payment applications without central approval. This fosters innovation across global markets and eliminates the need for intermediaries, reducing costs and increasing accessibility for businesses and individuals. Solana provides an ideal framework for global payment financing solutions by enabling cross-border payments. Solana Pay is a generalized open-source framework for commerce payments that facilitates direct merchant-to-consumer transactions and is a central component of the Solana ecosystem’s contribution to PayFi. Solana Pay supports stablecoins like USDC and other Solana-native SPL tokens, enabling low-cost, real-time payments that eliminate the delays and high fees associated with traditional credit card systems. Solana Pay’s features include: Direct, Transparent Payments: Merchants receive payments near-instantly without involving third parties and can track all transactions. Integration with E-Commerce: Solana Pay integrates with platforms like Shopify via Helio, allowing businesses to accept stablecoins for online purchases with minimal setup. Wallet Interoperability: It supports a variety of Solana-based wallets (i.e., Phantom, Solflare, etc.), ensuring users can transact using their preferred tools. Beyond facilitating payments, major financial institutions like Visa, PayPal, Stripe, and Circle have built Solana integrations to strengthen liquidity within the PayFi ecosystem, ensuring stablecoin accessibility for merchants and consumers. Solana’s integration with PayPal was done to improve the speed, scalability, accessibility, and cost of PYUSD transactions. This integration enhances the efficiency of PYUSD transactions and aims to broaden its adoption across various platforms, contributing to the growth of Solana's ecosystem. All of these integrations leveraging Solana’s low transaction costs and scalability, provide the foundation for new financial models, including onchain credit systems and programmable payments. Other payment-related innovations in the Solana ecosystem include blockchain links (blinks). Blinks are a feature introduced by Solana that transforms onchain actions into shareable links, allowing users to perform blockchain transactions directly from various platforms without leaving their current app or web page. This innovation is part of Solana Actions, APIs that facilitate transactions on the Solana blockchain. Blinks have been integrated into various platforms, including social media and e-commerce sites, enabling activities such as buying NFTs, swapping tokens, and staking SOL directly from social media timelines. Solana’s infrastructure improves existing systems and enables new use cases that were previously impossible. By supporting innovations like programmable credit, microtransactions, and value exchange, Solana empowers developers to create financial primitives that expand access to capital, reduce settlement latency, and drive the adoption of digital payments across industries. In summary, Solana’s high throughput, scalability, and low-cost transactions position it as a backbone for payment solutions in the PayFi ecosystem. Its decentralized and developer-friendly infrastructure fosters innovation, making Solana a natural choice for building scalable, global payment applications and driving the future of onchain finance. Stellar Founded in 2014, Stellar is a proven blockchain optimized for global payments, making it well-suited for the transaction layer in the PayFi ecosystem. Stellar's fast transaction speed—processing payments within 5 seconds—paired with the low transaction fees, averaging $0.00005, positions it as a cost-effective and scalable solution for cross-border payments. Stellar enables direct, peer-to-peer transactions while simplifying currency conversions, which is particularly impactful in remittances and emerging markets where traditional systems are costly and inefficient. A key strength of Stellar is its asset tokenization capabilities, which allow users to digitize assets, from national currencies to commodities like precious metals. This enables fast, inexpensive asset transfers between parties, even across borders or currencies. Anchors, a Stellar-specific term for the on/off-ramps connecting the Stellar network to traditional financial systems like financial institutions or fintech companies, enhance accessibility by bridging the gap between blockchain and traditional finance. Complementing Stellar is the Stellar Disbursement Platform (SDP), an open-source solution for bulk payments. The SDP supports up to 10,000 transactions in a single operation, settling funds near-instantly and operating 24/7. It also simplifies recipient onboarding through wallet creation via SMS invitations. With integrations like MoneyGram, the SDP bridges digital assets with fiat, enabling real-time payroll, humanitarian aid, and vendor payment disbursements. The introduction of Soroban in March 2024, the Stellar smart contract platform, is an additional advancement for the network, enabling it to host smart contracts on the PayFi stack. Soroban adds programmability to Stellar, allowing developers to build scalable dapps that automate complex financial processes. With Soroban, Stellar now supports DeFi protocols, decentralized exchanges (DEXs), and other financial products, which previously limited the network's capabilities. These tools allow developers to create dapps on the application layer of the PayFi stack. By combining its proven role as a payment-focused blockchain, smart contracts, and the SDP’s bulk payment capabilities, Stellar is uniquely positioned to be a key foundational contributor to the transaction layer of the PayFi ecosystem. The Stellar infrastructure enables more secure, efficient, and cost-effective solutions for global payment financing while paving the way for innovative financial primitives to address gaps in traditional systems. Currency Layer The currency layer for PayFi dapps is predominantly built on USDC, with PYUSD and USDP also utilized in some cases. New PayFi dapps can integrate other major stablecoins, such as USDT and USDM, with additional non-USD options like EURC, XSGD, GYEN, and HKDR expected in the future. The availability of multiple stablecoins tied to different national currencies enhances accessibility for on/off ramps, enabling more versatile payment options beyond USD-backed conversions. This supports international transactions and crypto-to-fiat settlements, improving the attainability of blockchain transactions globally. In 2024, the total stablecoin market cap increased by 57%, from $130 billion to $204 billion. This growth is largely driven by the dominance of the two major stablecoins, with USDT capturing a 68% share of market cap and USDC holding 22%. As the stablecoin market expands, the range of use cases built on stablecoins will likely grow alongside it, including PayFi applications. The increased adoption of stablecoins as a store of value and medium of exchange creates a supportive foundation for applications leveraging these assets. The monthly stablecoin transfer volume increased by 148% in 2024, from $1 trillion to $2.6 trillion. In December 2024, the share of transfer volume was the inverse of the stablecoin market cap distribution, with USDC accounting for 55% of transfer volume compared to 39% for USDT. While the increase in stablecoin transfer volume can be attributed to various factors, USDC’s larger share of transfer volume relative to its market cap suggests it is more frequently utilized in dapps requiring significant transfer activity. Conversely, USDT’s lower share of transfer volume relative to its market cap likely indicates its predominant use as a store of value. These trends highlight USDC’s potential as a foundational stablecoin for applications requiring a high volume of microtransactions. This aligns with the needs of PayFi applications, which depend heavily on such transaction patterns, underscoring USDC’s suitability for the Currency Layer of the PayFi infrastructure stack. In addition to stablecoins enabling a medium of exchange for PayFi dapps, infrastructure providers like Portal and Perena ensure the management of stablecoin assets. Portal focuses on infrastructure that helps users transact by leveraging blockchain-based assets to bridge traditional and decentralized financial systems. Portal Portal provides wallet infrastructure and a Web3 interface to help partners enable Web3 capabilities on their apps. Its SDK allows partners to connect to protocols and decentralized applications via mobile or desktop browsers. Using multi-party computation (MPC) cryptography, Portal offers an embedded wallet without seed phrases, enhancing security and user accessibility. Portal also supports stablecoin infrastructure, enabling the creation of USD Stablecoin Accounts. These accounts allow users to receive, store, and spend wealth in digital dollars, particularly in emerging markets. Portal’s infrastructure supports features like Visa-backed physical and virtual credit cards for spending stablecoins locally and off-ramp solutions that facilitate cashing digital dollars into local currencies. Portal supports use cases like DeFi swaps, NFT games, and cross-border payments. Portal has partnered with exchanges, fintechs, and developers to facilitate Web3 onboarding and integration while expanding stablecoin accessibility for global users. Perena Perena is a stablecoin infrastructure provider on the Solana blockchain focused on creating a unified and liquid ecosystem for stablecoins. It addresses challenges like liquidity fragmentation and inefficient capital usage in the stablecoin market. At the core of Perena’s offerings is Numéraire, a multi-swap stableswap integrated with major stablecoins, including USDT, USDC, and PYUSD. Numéraire (Beta) is an automated market maker (AMM) that enables the creation and swapping of stablecoins and aims to maximize capital efficiency while protecting users from MEV attacks. Perena’s innovative use of a tranched collateralized debt position (CDP) system enables the minting of synthetic stablecoins backed by tokenized real-world asset yields. This approach aims to transform stableswaps into liquid synthetic dollars, bridging the gap between DeFi principles and traditional finance systems. Perena seeks to build a scalable, liquid, stablecoin ecosystem within the Solana network. Custody Layer This layer addresses the secure storage and management of digital assets, which is crucial for payment financing. Institutional-grade custody solutions are provided by companies such as Fireblocks, Cobo, and Copper. These platforms offer features like multi-party control of assets, security protocols for asset liquidation in case of default, and granular account management controls. Such sophisticated custody solutions are essential for institutional users and are increasingly becoming accessible to retail and small business users through advancements in self-custody wallet technologies. Compliance Layer One critical challenge for utilizing stablecoins in real-world payments is ensuring regulatory compliance, particularly regarding Anti-Money Laundering (AML) practices. The permissionless nature of assets moving across wallets and chains complicates tracking illicit activity, creating blind spots that regulatory agencies find challenging to navigate. Moreover, the centralized structures of many cryptocurrency payment systems introduce custodial risks, inefficiencies from fiat settlement integrations, and limited service capabilities. To address these challenges, companies like Chainalysis, Elliptic, and TRM Labs offer advanced AML solutions that improve monitoring and tracking capabilities. Similarly, PolyFlow provides an innovative compliance-focused infrastructure layer tailored for PayFi. PolyFlow offers a modern framework to tackle the inefficiencies and risks in traditional cryptocurrency payment systems by decentralizing transaction handling, incorporating privacy-preserving technology, and ensuring custody-free operations. PolyFlow PolyFlow is an infrastructure layer designed to enable the direct purchase of goods and services using cryptocurrency. It focuses on fund settlement between wallets—whether crypto or fiat—without relying on banking accounts. It decentralizes real-world transaction handling to reduce centralized custody risks and regulatory blind spots, offering a custody-free model that adheres to compliance standards. Key to PolyFlow’s value proposition is its Payment Identity (PID) layer, a decentralized ID linked to encrypted user privacy-protected KYC/KYB information. This enhances regulatory compliance without compromising user privacy. The PID is instrumental in establishing a credit framework for small and medium-sized businesses. This strategy targets the often underserved sector that investors can support, promoting financial inclusion and growth. PolyFlow also addresses inefficiencies in the traditional crypto payment model by reducing reliance on opaque centralized systems and minimizing dependence on traditional fiat settlement. With its payment liquidity pool (PLP) for settlement execution, PolyFlow simplifies the gateway to crypto mass adoption for multiple use cases, such as supply chain finance on the Stellar network. By leveraging tokenization, PolyFlow unlocks onchain liquidity for tokenized ‘accounts receivable’ assets and effectively transfers enterprise buyers' credit to upstream suppliers, thereby enhancing capital accessibility. By integrating DeFi compatibility, PolyFlow generates yield through liquidity provision for payment transactions, a critical requirement for the widespread adoption of PayFi. The PLP combines innovative compliance adherence, privacy protection, and service versatility, positioning itself as a foundational compliance protocol in the PayFi ecosystem. Financing Layer The financing layer encompasses protocols that enable lending pools for PayFi applications by connecting capital supply with demand. It focuses on managing risk, asset pricing, structuring, tokenization, and distribution, making it a critical part of PayFi infrastructure. Huma Finance serves as a leading decentralized lending infrastructure protocol, coordinating the operation of these pools within the PayFi ecosystem. Huma enables lenders to supply capital for fixed durations (e.g., three or six months). Liquidity providers can then earn returns ranging from 10% to 20%, as seen on the Arf pool on Solana. These yields are funded by borrowing fees collected from users of PayFi applications. The loans are collateralized with assets such as future income statements, validated by credit assessment services like Credora. Oracles like Chainlink and Pyth integrate onchain and offchain data, supporting accurate credit assessments and further reinforcing this growth cycle. Huma Copilot Insights: What is Huma Finance? At its core, Huma enables liquidity providers (LPs) to deposit, earn, and withdraw funds while offering borrowers access to credit facilities. The protocol differentiates itself from traditional DeFi lending platforms in several key ways: Tailored for Payment Financing: Huma specializes in payment financing, offering credit lines and receivable-backed credit options to address the specific liquidity needs within this space. Modular Structured Finance: Huma’s structured finance modules provide flexibility in adapting to different financial contexts, allowing customization of repayment schedules, fee structures, and tranches. This adaptability makes Huma suitable for a variety of use cases across industries. Advanced Risk Management: Huma’s risk management framework incorporates dynamic evaluation agents for assessing credit. These agents review and approve credit requests, determine credit terms (e.g., limits, duration, interest rates), declare defaults when necessary, and restructure credit terms. The system aims to mitigate risk effectively and maintain borrower accountability throughout the lending process. Instant Liquidity: Huma provides immediate access to funds through efficient liquidity solutions, enabling borrowers to deploy capital quickly. Compliance and Open Architecture: Huma works with licensed partners to perform KYC/KYB processes and investor checks to ensure regulatory compliance. Its open, modular architecture also supports cross-layer interoperability, fostering the creation of innovative financing solutions. For lenders, funding PayFi applications can offer higher yield returns on a user’s USDC than other alternatives, such as Ondo, albeit with higher risk due to the possibility of delinquent loan repayments. Ondo offers an alternative to typical DeFi yield opportunities by introducing tokens collateralized by U.S. Treasury RWAs. For instance, OUSG is a tokenized security backed by Blackrock's U.S. Treasuries ETF (SHV), which tracks the performance of short-term U.S. Treasury bonds maturing within one year. Historically, these yields are reliable but low and can fluctuate with market conditions, often reflecting broader economic trends such as inflation and Federal Reserve interest rate adjustments. This can compress returns during periods of monetary easing. Yields enabled by PayFi dapps are derived from payment financing primitives essential to many businesses, such as international payments. The critical role these primitives play in everyday business operations ensures stable demand, which supports consistent returns and reduces susceptibility to broader economic fluctuations. These financing layers can provide real-time evaluations of lenders. This transparency can bolster lender confidence and attract institutional participation. This can create a positive flywheel: as more borrowers repay loans successfully, the system's credibility is enhanced, increasing liquidity from larger suppliers. Huma also supports the application layer of the PayFi stack, comprising applications that deliver a range of payment financing services. An example is Arf, which specializes in cross-border payments. Monthly payments financed by Huma & Arf increased 116% in 2024, rising from $63 million in January to $136 million in December. Monthly repayments also increased 108% in 2024, rising from $63 million in January to $131 million in December. Huma’s total onchain transaction volume has surpassed $2.9 billion on an all-time basis. Rain, a digital-asset-backed credit card platform, exemplifies how PayFi sector applications leverage the PayFi stack's foundational infrastructure, such as liquidity pools and financing protocols provided by platforms like Huma. In addition to Rain, Huma operates diverse lending pools tailored to various financing needs, supporting dapps such as BSOS for trade finance, Jia for small business financing, and Roam, a decentralized global Wi-Fi roaming network. Roam leverages Huma to operate a DePIN hardware financing program on Stellar, allowing users to leverage cash flow generated by Roam products (i.e., Roam Rainier MAX 60 routers). Users can use Roam tokens or NFTs as collateral to obtain loans from Huma, which can then be used to purchase Wi-Fi hardware. Operators can manage the equipment, earn through RoamPoints rewards, and repay their loans. To prioritize risk management, Huma focuses on launching low-risk pools to ensure stability and security rather than indiscriminately increasing the number of available options. Currently, seven active pools on EVM-compatible blockchains support the applications listed above. Arf partnered with Huma and their pool is active on Solana and Stellar. Stellar also supports a finance pool for Roam, demonstrating the network’s growing PayFi adoption within the ecosystem. Application Layer The PayFi ecosystem is vast and underpinned by major players driving innovation and adoption across its foundational layers, such as Stellar, Solana, and Huma. While key layers of the Open PayFi Stack—such as transaction and financing—provide the infrastructure for secure and efficient operations, the most critical layer for user engagement is the application layer. This layer enables end users to interact with PayFi solutions across diverse use cases, including cross-border payments, remittances, DePIN funding, trade finance, and more. This section highlights some of the key participants in the PayFi application layer today, where the impact of these innovations is most visible to users. While not exhaustive, this overview demonstrates the breadth of the PayFi ecosystem as it continues to grow and evolve. Arf Arf is a global liquidity platform providing short-term financing solutions for cross-border payments, focusing on licensed financial institutions. Arf offers onchain liquidity that enables 24/7 instant, low-cost USDC-based settlements, removing the need for pre-funded accounts. Traditional cross-border payments require financial institutions to maintain significant pre-funded capital in accounts across multiple countries, a capital-intensive and inefficient model that hinders scalability and innovation. Arf addresses this by introducing the world’s first short-term, revolving, USDC-based liquidity solution for cross-border payments, eliminating pre-funding and counterparty risks. The protocol has become one of the fastest-growing stablecoin use cases, with over $2.9 billion in onchain volume and no credit defaults to date. By enabling same-day settlements with complete traceability through onchain transparency, Arf ensures faster, cheaper, and more reliable payment flows. Arf’s liquidity pools currently offer an APY of 10 to 20% while maintaining a healthy gross margin. Backed by notable investors like Circle Ventures and the Stellar Development Foundation, Arf aims to democratize liquidity access, promoting financial inclusion on a global scale. Arf has demonstrated strong capital efficiency, achieving rapid turnover with 50 cycles per year and processing $1.5 billion in loan volume. In December 2024, it operated with an average liquidity of $30 million and plans to scale this to $200-$250 million in 2025. Bitso x Felix Felix, a WhatsApp-based payments platform, and Bitso, a cryptocurrency exchange with over 5 million users, have partnered to transform remittance payments across Latin America. Traditional remittance processes are slow and costly, often requiring users to visit physical locations, pay high transaction fees averaging $10 for a $300 transfer, and handle cash, which can pose safety risks. Felix delivers a secure, affordable remittance solution by integrating Stellar payment rails, USDC, and Bitso’s on/off-ramps. Using Felix, users in the U.S. send remittances directly through WhatsApp by interacting with an AI bot that collects transaction details and provides a secure payment link. Payments are made with debit cards, and once completed, funds are collected as U.S. dollars, converted to USDC in Felix’s Bitso account, and then transferred to local currencies such as Mexican pesos. These funds travel through local banking rails, such as SPEI in Mexico or other country-specific systems, and are deposited into recipients’ bank accounts. This solution significantly reduces the time and costs of cross-border payments, enabling funds to arrive within seconds. With a user-friendly platform and extensive local banking integrations, Felix and Bitso ensure broad access to remittances across Latin America, improving financial inclusion and creating a faster, less cumbersome cross-border payment experience for both senders and recipients. Airtm x Bridge Paying workers in regions with volatile currencies and high inflation presents significant challenges for employers and employees. Employers need a reliable and efficient way to meet global payroll requirements, while workers require timely payments that retain their value and can withstand local currency instability. Traditional cross-border payment systems are slow, costly, and often fail to penetrate emerging markets. They also involve complex compliance processes, expensive currency conversion, and technical barriers to integrating modern payment networks. To address these challenges, Airtm and Bridge, powered by the Stellar network, developed a platform for cross-border payments. Airtm is a financial technology company that provides users with a globally connected digital dollar account, enabling them to receive payments, access money in e-wallets, and convert funds to local currency. Users can add funds through over 400 methods, withdraw money near-instantly, and send or request payments from other Airtm users. With the integration of Bridge’s stablecoin orchestration service, the platform ensures efficient currency conversions between fiat and stablecoins like USDC or USDP, providing secure and inflation-resistant payment options. The platform leverages Stellar's low-cost and instant payment infrastructure, which is supported by Airtm’s robust capabilities. Users can withdraw funds peer-to-peer to digital wallets, cryptocurrencies, and more. They can also transfer funds directly to their local bank accounts in 15 countries, including Argentina, Brazil, and Mexico. By combining Airtm’s global financial tools, Bridge’s stablecoin services, and the Stellar network, this solution empowers individuals and businesses in emerging markets with fast, affordable, and reliable access to earnings. BSOS Established in 2018, BSOS powers supply chain growth for fintech solutions, providing liquidity to startups through blockchain and DeFi. BSOS’s Green Finance Pool allows accredited investors to fund projects like ChargeSmith, an EV charging station network in Taiwan, using short-term credit loans backed by projected revenue. With a goal of 1,500 charging stations by 2025, ChargeSmith relies on BSOS and Huma to secure credit for expansion. The Green Finance Pool offers monthly interest, with collateral backed by charging stations and managed revenue. BSOS also integrates enterprise resource planning with onchain liquidity, enabling shorter-term trade finance. Easy Labs Easy Labs is a Web3 financial contract automation platform that enables teams to build and manage complex payment flows. The platform allows both Web2 and Web3 teams to reduce transaction costs, scale operations, earn passive yield on assets, settle payments faster, and facilitate cross-border transactions while gaining a clearer understanding of organization-wide fund flows. Easy Labs aims to bring Web3 efficiencies to traditional Web2 businesses. Fonbnk Fonbnk is a global marketplace that allows users to convert mobile airtime into digital money, bridging Web3 technology with hyper-local payment methods for fast, secure, and dollar-based settlements. Supported in countries like Nigeria, Kenya, and South Africa and operating on PayFi blockchain pillars such as Stellar, Solana, and Celo, Fonbnk aims to revolutionize cross-border payments and promote financial inclusion. The platform enables users to swap airtime with trusted market makers, converting it into stablecoins that can be deposited into digital wallets, swapped for local currency, or used to access DeFi services. Fonbnk’s on-ramp process lets users transfer funds to an agent and receive stablecoins in their wallets. At the same time, its off-ramp feature allows crypto to be converted back into fiat currency and deposited into bank accounts or other specified methods. With its fast and secure mobile top-up services and integration of stablecoins, Fonbnk empowers individuals in emerging markets with easy access to digital and traditional financial systems, driving financial inclusion and innovation. GoBankless GoBankless is a digital banking platform leveraging blockchain technology to enable peer-to-peer payments and stablecoin transactions across Africa. The platform facilitates instant cross-border payments, USDC-to-cash conversions, and cash delivery services, with features like real-time funding, prepaid digital cards, and customs clearance integration. By minimizing fees and providing tailored solutions, GoBankless empowers businesses and individuals to access efficient and affordable financial services. For Africa’s financial ecosystem, GoBankless is critical in promoting financial inclusion by offering accessible tools for the underbanked and unbanked populations. Its real-time, low-cost payment solutions support SMEs, enhance cash flow management, and boost operational efficiency. Additionally, the app fosters economic growth by empowering informal economies and enabling interoperability across different financial platforms. GoBankless drives innovation and accessibility in Africa’s financial landscape while promoting broader economic activity. Helio Helio is a self-serve platform that enables merchants, creators, and developers to accept onchain payments in USDC and hundreds of digital currencies, with features like instant payouts, low fees, and advanced Web3 capabilities. Helio Pay supports integration into e-commerce systems, providing onchain checkout and custom trading infrastructure for marketplaces, DEXs, and high-volume apps. Supported across Solana, Bitcoin, Ethereum, and Polygon, Helio offers real-time payouts with a 1% transaction fee, eliminating chargeback risks. The platform runs Shopify's official Solana Pay plugin and supports merchants through no-code integrations, benefiting over 6,000 sellers with $1.5 billion in annual sales. Helio’s funding includes a $3 million seed round in April 2023, and its NFT subscription, HelioX, reduces transaction fees for merchants. Jia Jia is a blockchain-based microfinance platform that provides small-business loans to enterprises in emerging markets, focusing on Kenya and the Philippines. Jia offers revenue-backed loans to help businesses grow or maintain operations, serving medical clinics, consumer goods, food and beverage, and transportation sectors. An example customer might include a medical clinic needing short-term capital to procure supplies, which would be challenging without affordable financing. Borrowers who repay loans are rewarded with Jia tokens, incentivizing timely repayment while fostering community ownership in the lending ecosystem. Rain Rain offers a digital asset-backed credit card solution that allows businesses (mainly Web3 companies and DAOs) to spend stablecoins like USDC wherever Visa is accepted, leveraging Polygon. The cards enable fast, low-cost transactions for expenses like corporate travel, with integration into mobile wallets such as Apple Pay and Google Pay. Rain reshapes spend management for Web3 teams by providing USDC-backed corporate cards, where corporate treasuries pledge assets to set credit limits, with onchain liquidation at the end of each billing period. Rain partners with Huma Finance as a liquidity provider, offering an accessible solution for crypto-native organizations needing fiat transactions without relying on traditional credit card assets. Reap Reap is a Hong Kong-based financial management platform offering businesses a suite of tools to simplify payments, expense management, and cash flow operations. By bridging traditional banking and digital assets, Reap empowers businesses with solutions tailored to both Web2 and Web3. Their key offering is the Reap Card, a secured Visa corporate credit card collateralized with fiat or stablecoins like USDC, providing businesses with credit access without traditional banking dependencies. The card supports flexible repayments in fiat or digital currencies, accommodating diverse operational needs. Through Reap Pay, businesses can make global payments, such as rent or payroll, without requiring a bank account, leveraging stablecoins to reduce reliance on conventional banking systems. The platform’s Reap Treasury consolidates fund management with distinct balances for Reap Card, Reap Pay, and general funds, enabling seamless transfers to optimize liquidity and payment capabilities. Reap supports transferring USDC & USDT on Solana, Ethereum, Polygon, and USDT on Tron. Reap combines innovative payment infrastructure with robust security and privacy features, establishing itself as a comprehensive financial management solution for businesses navigating traditional and blockchain-enabled financial environments. Sanctum Sanctum is a platform enabling the launch and trading of liquid staking tokens (LSTs) on the Solana blockchain. Its features include zero-slippage trading and yield generation through deposited LSTs. The platform is integrated with Jupiter and Solflare. It allows teams, creators, and DAOs to create LSTs and earn staking rewards from token holders, providing innovative tools for monetization and community engagement. In the PayFi ecosystem, Sanctum’s Creator Coins offer a sustainable, permissionless way for creators to monetize their communities by issuing coins backed 1:1 with SOL. This ensures stability and reliability while allowing creators to earn predictable rewards from staking income. Supporters holding these coins gain access to exclusive content, perks, and experiences, fostering deeper creator-fan connections. Creator Coins also highlight the real-world utility of cryptocurrencies by moving beyond speculative trading to create tangible value. Examples include HealthSOL, a health charity initiative that allows users to hold HealthSOL and donate staking rewards to public health initiatives in emerging markets, and Flojo, a wellness beverage brand using Creator Coins to build a loyal community while bypassing traditional advertising. By leveraging its unified liquidity layer, Sanctum guarantees 1:1 coin backing to SOL. Sphere Sphere is a blockchain-based payment platform built on the Solana blockchain, designed to facilitate cryptocurrency and fiat business transactions. It offers fiat on-ramps, recurring subscriptions, and API integration, enabling acceptance of payments across crypto and fiat. Sphere focuses on simplifying cross-border transactions and reducing high fees and processing times seen in TradFi. Initially supporting DePIN networks like Helium, Sphere allows users to transact in fiat without holding native tokens. It also aims to expand its services to other DePINs, including Hivemapper and Render, while becoming a comprehensive API for currency swaps and cross-chain payments. Sphere supports major credit cards (Visa, Mastercard, American Express, Discover), bank transfers, and wires in over 120 countries, focusing on developing economies. Building on its core offerings, Sphere has introduced Spherenet, a permissioned blockchain solution built on the Solana Virtual Machine (SVM) and designed for regulated financial entities. Spherenet is a credibly neutral, privacy-preserving, and natively compliant shared account ledger. Spherenet facilitates licensed counterparty discovery, verification, and universal settlement at near-instant speeds. Developed by a global consortium of regulated institutions and fintechs, Spherenet provides secure, compliant infrastructure for cross-border trade finance and emerging market transactions. With advanced features like confidential transfers and delegated authority, Spherenet ensures jurisdictional compliance while maintaining privacy. Currently operational in 14 emerging and developed jurisdictions, Spherenet underscores Sphere’s mission to bridge traditional finance and blockchain, enabling integration for regulated institutions in PayFi. Zoth Zoth is a blockchain-based platform that bridges TradFi and DeFi by tokenizing RWAs to provide liquidity solutions and high-yield investment opportunities. Founded in 2023, Zoth offers institutional and accredited investors access to secure, fixed-income products, such as trade finance receivables, U.S. Treasury Bills, and corporate bonds. Zoth’s offerings include ZeUSD, a stablecoin backed by high-quality RWAs, and the $100 million Tokenized Liquid Note (ZTLN), backed by U.S. Treasuries and corporate bonds. With $106 million in assets originated, a 91% repeat investment rate, and a 0% default rate, Zoth aims to create secure and efficient financial products integrated into the blockchain ecosystem. Future of PayFi PayFi is set to expand with increasing offerings and growing user adoption. This section highlights specific use cases and applications expected to experience significant advancements in 2025 and key ecosystem developments that will drive and support this growth. T+0 settlement PayFi's future could involve transforming cross-border transactions through T+0 settlement. Currently, cross-border payments take two to three days to settle, creating inefficiencies and cash flow challenges. Protocols that leverage the PayFi six-layer infrastructure stack can enable same-day settlement, directly addressing these issues. This can streamline global payment flows in a way that is impossible for today’s financial systems. This capability is especially impactful for global companies navigating complex supply chains across multiple jurisdictions. For example, businesses like Amazon often deal with multi-step payment flows that can result in operational delays due to settlement bottlenecks. T+0 financing eliminates these obstacles, ensuring seamless, real-time transactions and unlocking operational efficiency at scale. As the T+0 settlement solution develops, it could set a new benchmark for financial innovation and become a key differentiator for the PayFi ecosystem. By providing a settlement speed that traditional finance cannot match, T+0 financing positions PayFi as a leader in driving innovation for global payment systems. Its success could catalyze broader adoption, showcasing the transformative potential of blockchain-based financial solutions. Market Education Many protocols within the PayFi ecosystem leverage technologies from TradFi, DeFi, and RWAs, creating advantageous interoperability for building innovative solutions. However, this overlap can blur distinctions, making it challenging for users to differentiate PayFi-specific offerings from those rooted solely in other sectors. A prime example is the comparison between Aave’s DeFi lending protocol and Jia, a PayFi-focused small business financing platform that collateralizes tokenized ‘accounts receivable’ assets to fund loans. PayFi requires a coordinated effort to educate the market on its unique use cases to establish a clear identity. Tools such as the PayFi infrastructure stack and industry conferences will be critical in advancing awareness and driving growth for the sector. In 2025, multiple protocols/chains involved in the PayFi ecosystem will focus on raising awareness and communicating the sector's value proposition through active participation in major industry conferences. This includes Huma, the Solana Foundation, and the Stellar Development Foundation, who have planned PayFi events to be executed in the near future: February 2025: Consensus, Hong Kong May 2025: Token 2049, Dubai September 2025: Token 2049, Singapore November 2025: Meridian December 2025: Breakpoint, Abu Dhabi These events will provide opportunities to showcase PayFi’s ongoing developments and engage with key stakeholders. Regulatory Developments A key focus for 2025 will be monitoring and adapting to regulatory developments in various jurisdictions. The most significant regulatory changes for PayFi will center on stablecoin regulations and the application of crypto travel rules across jurisdictions. These frameworks are crucial for enabling financial institutions to utilize stablecoins for payments, compliantly. Clear regulatory guidance will accelerate the adoption of stablecoins, particularly in regions like the UAE, where progressive policies have already encouraged institutional participation in the PayFi and RWA domains. This clarity is expected to drive ecosystem growth by providing the compliance certainty necessary for conservative institutions to scale their involvement in PayFi. Also, recent regulatory frameworks, such as the EU’s MiCA regulation, foster a more compliant environment for RWAs. Countries like Switzerland, Luxembourg, Liechtenstein, and Singapore have already launched notable compliant tokenization initiatives. In October 2024, the World Economic Forum (WEF) announced that Australia, the United Kingdom, Brazil, and South Korea have committed to unveiling new regulatory frameworks. In addition to this, a potential pro-innovation approach from the Trump administration might bring about stablecoin legislation, providing clarity and bolstering institutional trust. Such policies, if implemented, could greatly improve the U.S. regulatory framework, creating a more favorable environment for blockchain-based payment systems. Projects within the PayFi sector will prioritize staying agile and compliant in response to these evolving frameworks. This includes developing standardized legal agreements for tokenized assets to streamline transactions and enhance investor confidence. Closing Summary PayFi represents a transformative approach to payment financing, addressing inefficiencies in traditional systems while enabling entirely new use cases. As stablecoin adoption grows, blockchain infrastructure matures, and regulatory clarity improves, PayFi is positioned to drive significant innovation across global markets. With foundational support from key players like Huma, Solana, and Stellar and promising metrics indicating rapid adoption, PayFi is poised to expand its influence in 2025, offering scalable, efficient, and accessible financial solutions for businesses and individuals worldwide.
Source: Austin Weiler — Published: 2025-01-23T13:01:00ZState of TRON Q4 2024
Key Insights TRON experienced positive growth across many key metrics in Q4, including a ~62.46% QoQ increase in market cap, reaching ~$21.94 billion, and an increase in QoQ revenue by ~34.81% to ~$740.29 million, an all-time high for the network. Partnerships with Bitget, Chainlink, and Mercado Bitcoin bolstered ecosystem growth in Q4. The launch of the MBRL stablecoin on TRON expands its presence in the Latin American market. DeFi activity on TRON showed mixed results in Q4, with DeFi TVL in USD decreasing by ~6.23% to ~$7.39 billion but retaining its position as the third-largest network by TVL. Daily DEX volume surged by ~135.12% QoQ, with SUN V3 accounting for ~78.98% of all volume. Technical upgrades from the TRON developer community in Q4 included Anaximander and Epicurus, which enhanced system performance and developer tools. TRON also increased network decentralization, with 423 Super Representative candidates (+4 QoQ) and 8,149 nodes distributed across 82 locations. Stablecoin usage remained strong, with USDT on TRON representing ~98.30% of the total stablecoin market cap, or $57.69 billion (decreasing ~2.11% QoQ). The average daily USDT transfer volume increased by ~28.18% QoQ, reaching ~$18.43 billion. Primer TRON (TRX) is a public, open-source blockchain network that relies on a Delegated-Proof-of-Stake (DPoS) mechanism. An election process is used to determine which validators participate in consensus. All TRX stakers vote onchain for the candidates they want to become Super Representatives (SRs). In each epoch, the top 27 most voted-for candidates become SRs within the active set and take turns producing blocks. A new election occurs every six hours. The TRON Virtual Machine (TVM) powers applications on the network and uses “Energy” and “Bandwidth” instead of gas, like its Ethereum Virtual Machine (EVM) counterpart. Bandwidth is gas spent on transactions, whereas Energy is gas spent on smart contract calls. Energy and Bandwidth can be acquired by staking TRX or burning TRX to pay for the Energy/Bandwidth required to execute a smart contract call or transaction. The TVM is EVM-compatible and offers developers affordable and fast smart contract execution. Website / X (Twitter) / Discord Key Metrics Financial Overview Market Cap and Revenue TRX’s circulating market cap increased for the eighth consecutive quarter in Q4, up ~62.46% QoQ from ~$13.51 billion to $21.94 billion. Furthermore, TRX outperformed other large-cap cryptocurrencies as its market cap ranking amongst all tokens (excluding stablecoins) rose one spot from 9 to 8. Notably, as a deflationary token, TRX’s price increased by more than just the circulating market cap due to the decrease in its circulating supply. TRON utilizes a resource model to execute transactions onchain. To summarize, the resource model is based on distributing Bandwidth and Energy to stakers. As long as stakers have acquired enough resources, they can use those resources to transfer tokens and execute smart contracts for free. Users must cover transaction fees with TRX if they utilize more computing power than their resources allow, all of which is burned. As such, revenues for TRON are derived from the TRX token burns coming from transaction fees. TRON had another solid quarter for USD revenue. Total Revenue in USD was up ~34.81% QoQ from ~$549.13 million to ~$740.29 million. Due to the ~63.25% increase in token price in Q4, Total Revenue in TRX was down ~6.59% QoQ from ~$3.83 billion to ~$3.58 billion. Supply Dynamics The circulating supply of TRX is affected by two parameters: (i) tokens minted to reward stakers and block producers, and (ii) tokens burned due to network transaction fees. TRX rewards equate to ~5.06 million tokens being minted per day. As such, the circulating token supply will decrease over time if more than 5.06 million TRX are burned daily, on average. In Q4, the circulating supply of TRX decreased from ~86.62 billion to ~86.20 billion. Annualized, this equates to an inflation rate of approximately -2.59%. Annualized inflation was down QoQ, decreasing ~19.76% from approximately -3.22%. TRON incentivizes participants in its staking mechanism through a combination of the following: Block Reward - Super Representatives earn 16 TRX for each block produced (subject to change through onchain governance). After producing a block, the Super Representative’s chosen commission ratio is kept, while the remaining TRX is distributed amongst the representative’s associated voters. Vote Reward - The 28th to 127th most voted-for Super Representatives become Super Representative Partners for the next epoch. While partners do not participate in block production, they still receive voting rewards, as well as the TRX stakers that voted for said partners. For every block produced, 160 TRX is rewarded to Super Representatives and Super Representative Partners in proportion to their respective TRX stakers’ votes. The annualized real yield for staking decreased in Q4, down ~10.67% QoQ from ~8.18% to ~7.31%. This decrease was due to less TRX being burned in Q4. Network Overview Usage Q4 usage was mixed for TRON, with increases in some onchain activity metrics like daily transactions and daily active addresses, while others, like average daily new addresses and DeFi transactions, decreased. Average daily transactions increased ~7.19% QoQ from ~7.15 million to ~7.67 million, and average daily active addresses grew ~4.61% QoQ from ~2.12 million to ~2.22 million. Average daily new addresses broke its upward trend and decreased in Q4, down ~6.95% QoQ from ~208,500 to ~194,050. Of Q4’s average daily active addresses, ~8.74% were new addresses. The majority of transactions on TRON continue to come from wallet transfers and stablecoins. Wallet transfers were up ~6.02% QoQ from ~3.14 million to ~3.33 million, and stablecoin transfers were up ~6.49% QoQ from ~2.10 million to ~2.24 million. Collectively, wallet transfers and stablecoin transactions represented ~99.33% of Q4 transactions, up ~0.86% QoQ from ~98.48%. The most impacted area in terms of market share was DeFi transactions. After high Q3 volume, SunPump has cooled off, and the lack of subsequent trading activity on SUN caused a sharp decrease in the category’s transactions, down ~71.77% QoQ from ~44,000 to ~12,420. Infrastructure-related transactions had a significant QoQ increase, up ~52.08% from ~966 to ~1,469. Wallet transfers and stablecoins have historically dominated average daily active address activity on TRON. Q4 was no different, as an average of ~1.67 million addresses conducted a daily wallet transfer, up ~6.37% QoQ. Stablecoin transactions also increased by ~7.24% QoQ to ~670,030. Active addresses interacting with DeFi decreased by ~61.67% QoQ to ~2,570, while Infrastructure interactions increased by ~38.03% QoQ to ~536. Security and Decentralization TRON uses a Delegated Proof-of-Stake (DPoS) consensus mechanism and the Practical Byzantine Fault Tolerance (PBFT) consensus algorithm to secure the network. A DPoS election occurs every six hours, in which 27 Super Representatives (SRs) take turns producing blocks. Those wishing to run a TRON node can pay 9,999 TRX to become an SR candidate. While there may be centralization concerns regarding only 27 SRs participating in securing the network, at the end of Q4, over 423 SR candidates (up from 419 in Q3) received votes. This increasing diversity of candidates helps mitigate centralization concerns and promotes a more distributed governance model, enhancing the network's resilience and security. The growing number of SR candidates should challenge the voting population to distribute votes. Additionally, no singular entity received over 10% of all votes. The entity with the most votes was Binance Staking, which received ~3.11 billion votes out of ~40.88 billion in the most recent election (~7.61% of all votes). Although there may be some benefits to a democratic voting system for block production and a growing set of SR candidates, neither feature fully does away with centralization risks. Metrics such as the geographic diversity of nodes may also factor into a network’s level of centralization. At the end of Q4, there were 8,149 TRON nodes (up from 7,954 in Q3) distributed across 82 different geographic locations around the globe, with the highest concentration in Ireland (~20%). Too many nodes in the same location could jeopardize the health of a network due to geopolitical risks, regulations, and acts of nature, among other reasons. Since introducing the new staking mechanism, Stake 2.0 (TIP-467), in April 2023, it has become the default for all new staking activity. Any TRX staked after April 2023 is automatically assigned to Stake 2.0, while TRX previously staked under Stake 1.0 remains valid and unaffected. Stake 2.0 implemented a new layer to separate low-frequency staking operations and high-frequency resource delegating operations. It also introduced resource re-delegating without unstaking and improved resource utilization. Across both options, the staking ratio (the proportion of TRX’s total supply actively being staked) rose, increasing slightly to ~51% in Q4. Additionally, more users continued to switch to Stake 2.0 over 1.0 in Q4. Stake 2.0 ended the quarter with ~22.51 billion TRX staked (+9.67% QoQ), whereas Stake 1.0 finished with ~21.20 billion TRX staked (-0.92% QoQ). In sum, ~43.71 billion TRX were staked at the end of Q4, an increase of ~4.27% QoQ. Due to an increase in TRX’s price, total staked in USD was up ~71.44% QoQ from ~$6.56 billion to ~$11.25 billion. Compared to other PoS networks, TRON had the sixth-highest dollar value of funds staked by the end of Q4, maintaining its position from the prior quarter. It is worth noting that to take over the network through a two-thirds attack, a malicious actor would need to control 18 of the 27 SRs, or essentially two-thirds of the total stake. At the end of Q4, this threshold was ~27.25 billion TRX (~$7.01 billion). Bandwidth is the gas spent on transactions, while energy is the gas spent on contract calls. Users can stake TRX to acquire either resource accordingly: The amount of bandwidth obtained from an account’s stake = (the amount of TRX staked for obtaining bandwidth / the total amount of TRX staked for obtaining bandwidth in the whole network 43.2 billion). The amount of energy obtained from an account’s stake = (the amount of TRX staked for obtaining energy / the total amount of TRX staked for obtaining energy in the whole network 90.0 billion). Notably, the amount staked for bandwidth is up ~1.52% QoQ from ~27.46 billion to ~27.88 billion. As for energy, staking increased ~9.47% QoQ from ~14.47 billion to ~15.84 billion, in part due to overall higher gas fees. The amount staked for each resource is correlated with consumption. Daily bandwidth consumption and energy consumption were down QoQ, ~8.59% and ~24.61%, respectively. Technical Developments In Q4, TRON passed one proposal to modify the energy limit, and the TRON developer community released two network upgrades. Proposal 97 (Oct 03) - Modified the total Energy limit to 180000000000 Energy. This was approved by 21 of the 27 Super Representatives. Anaximander Upgrade (Oct 05) - The TRON developer community released GreatVoyage-v4.7.6 (Anaximander), a non-mandatory upgrade aimed at enhancing system performance, network robustness, and monitoring capabilities. Key updates include improved node synchronization stability, expanded metrics for TCP/UDP traffic, refined HTTP request monitoring, and a new disconnection strategy to prevent node isolation. Epicurus Upgrade (Dec 15) - The TRON developer community successfully initiated the v4.7.7 (Epicurus) upgrade on Dec. 15, 2024, following its release earlier in the month. Key changes include enhanced computational consistency with java.lang.StrictMath, improved event subscription logic, support for graceful node shutdowns, and more accurate duration metrics via gRPC interface updates. Ecosystem Overview DeFi DeFi TVL on TRON denominated in TRX fell ~42.56% QoQ from ~50.52 billion to ~29.02 billion. However, TVL denominated in USD was not hit as hard due to an increase in TRX’s price, down only ~6.23% QoQ from ~$7.88 billion to ~$7.39 billion. Compared to other networks, TRON dropped to the third-highest network by TVL, beating out fourth-place BNB Smart Chain (~$5.41 billion) by ~$2.25 billion. The large spike in DeFi TVL, in terms of USD in Q4, was due to a sudden rise in TRX’s price. The top three protocols by TVL on TRON are JustLend, SUN, and JustStables. JustLend, the largest protocol by TVL, saw its TVL increase ~5.55% QoQ from ~$5.75 billion to ~$5.96 billion. Total borrow volume on JustLend increased from ~$101.3 million to ~$134.62 million (+32.89% QoQ), perhaps signaling a greater appetite for leverage on TRON. SUN significantly increased its TVL, up ~23.94% QoQ from ~$755.40 million to ~$936.23 million. SUN consists of three different AMMs (V1, V2, and V3). By the end of Q4, V1 TVL was ~$482.04 million (~51.49% of TVL), V2 TVL was ~$261.36 million (~18.87% of TVL), and V3 TVL was ~$187.62 million (~16.69% of TVL). In sum, JustLend, SUN, and JustStables represented over 99% of DeFi TVL on TRON. DEX Volume Overall DEX activity on TRON continued to increase in Q4, with average daily DEX volumes increasing ~135.12% QoQ. Zooming in on SunPump, its slowdown is most evident through the decrease in volume routed through SUN V2, which hosts liquidity pools for bonded memecoins from SunPump. The average daily DEX volume on SUN V2 was down ~35.05% QoQ. Essentially all DEX volumes on TRON occur on SUN. In June 2023, SUN introduced a concentrated liquidity (CL) AMM to its product suite (SunSwap V3). Q1’24 marked the first time since SunSwap V3’s introduction that the majority of volume on SUN was routed through the V3 AMM. SUN V3 accounts for 78.98% of all volume on TRON. Stablecoins The stablecoin market cap on TRON has been steadily trending up over the past year, with Q4 breaking that trend with a slight decrease. Stablecoin market cap decreased by ~2.55% QoQ from ~$59.97 billion to ~$58.70 billion. USDT accounts for the vast majority of stablecoins on TRON, boasting a market share of ~98.30% (+0.02% QoQ). The market cap of USDT on TRON ended the quarter at ~$57.69 billion (-2.11% QoQ). Additionally, ~42.48% of all USDT in circulation is on TRON. Two other stablecoins on TRON had QoQ increases in Q4. The second largest stablecoin on TRON, USDD, was up ~2.31% QoQ from ~$730.60 million to ~$747.43 million. USDD’s market share also increased by ~0.27% QoQ to ~1.27%. Another useful metric for evaluating stablecoins is transfer volume. This metric measures the dollar value of stablecoins moving onchain, not just when interacting with DEX-based smart contracts. The average daily USDT onchain transfer volume maintained its upward growth in Q4, increasing by ~28.18% QoQ from ~$14.38 billion to ~$18.43 billion. Ecosystem Growth TRON continues to partner with leading companies in the blockchain space. A few notable partnerships and ecosystem upgrades that were announced in Q4 included: Bitget Partnership: Bitget has announced a strategic partnership with TRON, including the acquisition of $10 million worth of TRX. The collaboration aims to enhance blockchain adoption, leverage TRON’s infrastructure for innovative projects, and strengthen Bitget’s position in the Web3 ecosystem. SushiSwap: The Sushi team launched SushiSwap on Tron. World Liberty Financial (WLF): The TRON team announced a $30 million investment into WLF. Chainlink: The TRON team announced that they have joined the Chainlink Scale Program. TRON will be adopting Chainlink Data Feeds as their official Oracle solution. There is no exact timeline for this integration, but once integrated, TRON will discontinue support and reliance on WINkLink, their existing Oracle solution. TRON-Peg USD Coin: TRON DAO has launched TRON-Peg USD Coin on the TRON blockchain to streamline cross-chain transactions between Ethereum and TRON. The system ensures transparency with real-time reserve tracking, 1:1 USDC redemption, and free cross-chain transfers and is audited by ChainSecurity for reliability. Mercado Bitcoin launches MBRL stablecoin: Mercado Bitcoin has launched the MBRL stablecoin on the TRON blockchain, pegged to the Brazilian Real, to provide faster and more cost-effective transactions for its users. This partnership aims to enhance financial inclusion and expand TRON’s presence in the Latin American market by leveraging blockchain technology for stablecoin adoption. TRON continues implementing strategies to grow its ecosystem beyond stablecoins, with initiatives such as the TRON DAO Grants Program, a $100 million AI development fund, and the TRON Grand Hackathon seasons. On July 25, 2024, TRON launched HackaTRON Season 7, and on Nov 19, 2024, the winners were announced. The hackathon offered a prize pool of $650,000, including $500,000 in TRX and $150,000 in energy prizes. Over 1,300 individuals participated and 25+ teams were awarded prizes. Season 7 featured five competition tracks: Web3, Artistry, DeFi, Builder, and Integration, encouraging diverse blockchain solutions. Sponsors for the hackathon included Google Cloud, BitTorrent File System, Just Ecosystem Dapps, HTX DAO, SUN Ecosystem Dapps, and ApeNFT. TRON is now gearing up for Season 8 to help the next group of builders. In 2025, TRON will focus on enhancing network performance and scalability through initiatives like API performance optimization, support for ARM architecture, and parallel transaction execution. Economic model improvements, such as dynamic transaction fee adjustments, aim to strengthen the ecosystem’s sustainability. Long-term, TRON plans to explore other areas like account abstraction, and state data expiration to ensure robust infrastructure and future adaptability. Closing Summary In Q4, TRON sustained its performance across most key metrics, with TRX’s circulating market cap surging ~62.46% QoQ to ~$21.94 billion, marking eight consecutive quarters of growth. This achievement was driven by TRON’s deflationary token model, which saw the circulating supply decrease by ~0.42 billion TRX (-2.59% annualized), and strong network activity, including a ~7.19% QoQ increase in daily transactions and a ~4.61% rise in daily active addresses. The network’s staking ratio rose slightly to ~50%, with Stake 2.0 adoption increasing by ~9.67% QoQ. Despite a ~6.23% decline in DeFi TVL (USD) to ~$7.39 billion, TRON maintained its position as the third-largest network by TVL. Notable ecosystem developments included increased TVL in key protocols like SUN (+23.94% QoQ) and JustLend (+5.55% QoQ) and a ~135.12% QoQ spike in average daily DEX volumes, with SUN V3 emerging as the dominant AMM. Stablecoin activity remained a cornerstone of TRON’s ecosystem, with USDT accounting for ~98.30% of stablecoin supply and average daily USDT transfer volumes up ~28.18% QoQ to ~$18.43 billion. TRON further expanded its ecosystem through strategic partnerships with Bitget, Chainlink, and Mercado Bitcoin, alongside initiatives like HackaTRON Season 7, which attracted over 1,300 participants and awarded $650,000 in prizes. Looking ahead, TRON’s 2025 roadmap, coupled with initiatives like the $100 million AI development fund and the upcoming HackaTRON Season 8, positions the network for sustained innovation and ecosystem expansion.
Source: Jeremy Koch — Published: 2025-01-22T14:00:13ZMoonbeam Q4 2024 Brief
Key Insights Moonbeam Routed Liquidity (MRL) had $30.5 million volume across 2,300 transactions in 2024. MRL simplifies onboarding for parachains and boosts liquidity flow without lengthy governance or development processes. Transactions increased by 56% QoQ to 57,000 daily transactions. Additionally, Moonbeam had $122 million in inflows during Q4 2024. Developer activity continued to increase, with 222 total developers, 74 full-time, and 115 others according to Electric Capital as of November 2024. StellaSwap became the largest protocol by TVL at $12.5 million, up 5% QoQ and over 120% in six months. Stellaswap surpassed Moonwell which has been the leading DeFi protocol by TVL for most of Moonbeam’s existence. Moonbeam introduced plans for a strategic expansion into the Ethereum ecosystem. This initiative aims to launch an expansion chain in the re-staking ecosystem that leverages Ethereum validators and restaking for security while preserving Moonbeam's EVM and crosschain capabilities built on the substrate framework. Primer Moonbeam (GLMR) is a Layer-1 parachain on the Polkadot Network, serving as an EVM-compatible smart contract platform. It provides an Ethereum Virtual Machine (EVM) implementation and a Web3 API, enabling straightforward deployment of Solidity contracts and protocol interfaces with minimal modifications. Moonbeam enables crosschain integrations, leveraging its Moonbeam Routed Liquidity functionality and bridge networks. Its primary features include cross-chain integration, staking, and on-chain governance. The network includes multiple deployments: Moonbeam on Polkadot (December 2021), Moonriver on Kusama (June 2021), and Moonbase Alpha on TestNet (September 2020). This structure ensures safe and rapid updates to Moonbeam's mainnet. Moonbeam's technology stack, built with Rust and Substrate, provides a robust development environment. It boasts Ethereum compatibility, offering a full EVM implementation and Web3 RPC API, which integrates existing Ethereum tools and applications. As a key player in the Polkadot ecosystem, Moonbeam provides developers with an accessible route to leverage Polkadot's network effects while utilizing Ethereum tooling and compatibility. Website / X (Twitter) / Telegram Key Metrics Analysis During Q4 2024, GLMR’s circulating market capitalization rose to $230 million, reflecting a 44% quarter-over-quarter (QoQ) increase but a 36% decline year-over-year (YoY). The fully diluted market capitalization similarly increased by 44% QoQ, reaching $291 million, though it was down 44% YoY. Despite the quarterly increase in market capitalization, GLMR’s market cap ranking dropped from 276 to 325. GLMR is the native token of the Moonbeam network, with functions including incentivizing block producers to ensure network security, enabling onchain governance, and facilitating transaction fees. The token has an annual inflation rate of 5%, with no capped maximum supply. At the end of Q4 2024, GLMR’s circulating supply stood at 938.8 million tokens, an increase from the previous quarter’s 904 million. The percentage of GLMR staked decreased to 38%, down by 12% QoQ from 43% in Q3 2024. GLMR transaction fees (USD) increased by 232% QoQ in Q4 2024, totaling $159,000. This increase was driven by a surge in network activity, with daily transactions rising 56% QoQ to 57,000. The rise in transaction volume and fees reflects higher user engagement and network utilization. The total transaction fees generated by the network throughout 2024 amounted to $517,000. Of the transaction fees generated, 80% were burned, while the remaining 20% were directed to the network's Treasury. Addresses were flat QoQ in Q4 2024 with 2,200 daily active addresses, while transactions increased by 56% QoQ to 57,000 daily transactions. The increase in transactions was driven by heightened activity across key protocols, including Stellaswap, EvrLoot, Tokeniza, and N3mus, which collectively saw transaction growth due to new launches, feature expansions, and tournaments. As a result of the increased activity, Moonbeam became the leading parachain by active addresses and ranked as the third parachain by transactions. Developer activity continued to increase, with 222 total developers, 74 full-time, and 115 others according to Electric Capital as of November 2024. Moonbeam has implemented several technical upgrades over the previous six months: 6-Second Block Times: An upgrade that successfully reduced block times from 12 to 6 seconds, improving throughput capacity. Optimizing Data Access on Moonbeam: Chain Integration Process with The Graph Now Live: Integration with The Graph Network to enhance decentralized indexing and data querying capabilities. RT3100 Unlocking Passkeys and Other New Use Cases: Introduces Passkeys, enhanced crosschain compatibility through Snowbridge, and a new runtime API for optimized transaction costs. Glacis Integration: Integration of Glacis, providing universal cross-chain messaging and tools for developers. Gas limit per block at 60 million: By setting the gas limit to 60 million per block, Moonbeam significantly boosts the number of transactions that can be processed in each block. The 60M block gas limit plus cutting block times in half yields an 8x throughput increase. No-delay block time: Improving the responsiveness of wallet interactions. Daily XCM transfers averaged 528, which represented a 54% increase QoQ. Other XCM use cases averaged 50 per day, which decreased by 60% QoQ. The total XCM messages per day reached 578, reflecting a 23% increase QoQ. Moonbeam continues to rank among the top parachains in XCM activity. DeFi TVL (USD) on Moonbeam was $20 million, down 46% QoQ and 72% YoY. The decrease in TVL was primarily driven by Moonwell, which saw its TVL fall by 76% QoQ from $18.7 million to $4.4 million. The decrease in Moonwell’s TVL was primarily due to Coinbase discontinuing support for wBTC. StellaSwap became the largest protocol by TVL at $12.5 million, up 5% QoQ and over 120% in six months. Prime Protocol followed with $1.1 million in TVL, while FraxSwap recorded $715,000. The stablecoin supply on Moonbeam decreased by 4% QoQ to $8.2 million and remained essentially flat over the past year. FRAX was the leading stablecoin at $5.3 million, followed by USDC at $2.4 million. The remaining stablecoins collectively accounted for $500,000 in supply. Additional Developments Gaming was a major focus for Moonbeam in 2024. Key initiatives included the Polkadot Games Bounty funded with 100,000 DOT, the Lunar Gaming Festival, and support for games like Age of Chronos and Voidge. Moonbeam also invested in N3MUS through its $10 million Innovation Fund to support their gaming infrastructure, including a wallet and tournament system, which launched in December and registered 8,600 users within the first six weeks. Moonbeam advanced its focus on real-world asset tokenization through a partnership with Colb Finance as part of the Moonbeam × Colb Finance collaboration to introduce Swiss-compliant stablecoins and Tokenized Structured Products for professional investors. Other RWA protocols include Tokeniza, Zuka, DREX, and Tamarin Health. The DePIN Diode expanded to Moonbeam, offering secure communication tools such as encrypted chat, file sharing, and a Zero Trust Network VPN. Since June, DePIN Diode added 900 new users and aims to reach 1,500 nodes by 2025, incentivizing contributors with tokens. Other notable events included: Moonrise Points Campaign Recap: Concluded with 9,056 participants collectively completing 333,042 quests. Participants minted 368 NFTs through Rarible, while $100,000 in rewards was distributed separately from the Rarible activity, with top performers receiving a commemorative NFT. Governance Guild Launch: Established a governance guild with 5 million GLMR and 50,000 MOVR tokens delegated to 10 community delegates, fostering a more decentralized governance model. Partnership with Drex: Collaborated with Drex to support renewable energy projects in Ecuador, empowering over 300 small businesses with solar power through blockchain-based micro-investment. Christmas Tournament: Hosted a holiday-themed tournament with over 530 participants, awarding prizes in two competitions: Pinkmas Magic Drop and Jingle in the Jungle. The Moonbeam team also released a primer on Moonbeam Routed Liquidity in Q4 2024. MRL uses Wormhole and XCM to seamlessly bridge assets between Moonbeam and Polkadot parachains, enabling instant routing without direct bridge integration for parachains. By leveraging Moonbeam’s existing Wormhole connection, MRL simplifies onboarding for parachains and boosts liquidity flow without lengthy governance or development processes. This bidirectional system supports efficient asset transfers, such as routing USDC from Ethereum to a parachain, enhancing accessibility and scalability across Polkadot’s 51 parachains. MRL had $30.5 million volume across 2,300 transactions in 2024. Roadmap Moonbeam's roadmap for 2025 and beyond includes efforts to enhance crosschain interoperability, expand gaming initiatives, support real-world asset tokenization and DeFi, and explore new regional markets. This will be achieved by following the developments in the Polkadot and Ethereum ecosystems. The Moonrise initiative has made progress, with key developments such as reducing block times to six seconds, establishing an ecosystem fund, and incorporating Ethereum's Dencun compatibility. In September 2024, Moonbeam introduced a proposal to expand into the Ethereum ecosystem by launching an expansion chain secured by Ethereum restaking. This deployment, referred to as Moonbeam V2, would leverage Ethereum validators and introduce new restaking options. The proposal is in the research phase, with several deployment architectures under consideration. Potential opportunities include: Creating a DeFi hub for AVS project tokens, liquidity aggregation, and xERC20 adoption. Developing decentralized storage solutions within the EVM environment. Bridging XCM assets into the Ethereum restaking ecosystem. Implementing enhanced operator transparency and monitoring tools. Moonbeam continues to engage with the community and partners to refine its strategic direction and deliver on these roadmap goals. Closing Summary Moonbeam's performance in 2024 illustrates steady progress across key metrics, including network activity, developer engagement, and DeFi participation. Despite a challenging market environment, Moonbeam maintained its focus on core objectives such as crosschain interoperability, real-world asset tokenization, and ecosystem growth. Key upgrades, including reduced block times and enhanced developer tools, have positioned Moonbeam as a leading player in the Polkadot ecosystem. The introduction and success of Moonbeam Routed Liquidity further reinforces its growing adoption. Looking forward to 2025, Moonbeam’s roadmap highlights continued expansion and strategic development, including potential integration with the Ethereum ecosystem. The proposal is still being worked on, but it is nonetheless an exciting time for the Moonbeam community.
Source: Nicholas Garcia — Published: 2025-01-22T13:00:00ZState of OP Mainnet Q4 2024
Key Insights Average daily DEX volume (USD) grew 91.9% QoQ to $144.5 million, up 118.4% YoY. This was led by Velodrome, which had a historic quarter making up 57.9% of DEX volume at an average of $84.2 million per day. TVL (USD) increased 11.3% QoQ to $756.1 million, though was down 16.1% YoY. USDC’s market cap surged 277.4% QoQ to $360.5 million, while USDT’s market cap fell 22.4% to $914.7 million. Average transaction fees fell 90.8% YoY to $0.03 due to EIP-4844 blobs. This led to a 173.8% YoY increase in average daily transactions, up to 928,200 in Q4’24. OP’s price stayed flat QoQ at $1.75 but its market cap rank fell from 43rd to 50th, underperforming the broader market and its Layer-2 peers. Airdrop 5 distributed 10.37 million OP tokens worth $15.9 million to 54,723 addresses that transacted on various OP Chains between March and September 2024. Primer Optimism (OP) is a Layer-2 network that aims to increase Ethereum’s transaction throughput while decreasing the cost of transacting. This is achieved through an optimistic rollup design. Transactions are executed on OP Mainnet, Optimism’s original network, while relying on Ethereum for settlement, consensus, and data availability. After years of research on Ethereum scalability by founders Benjamin Jones, Karl Floersch, Jing Wang, Mark Tyneway, and Kevin Ho, Optimism launched on public mainnet in December 2021. The years that followed saw Optimism Foundation and OP Labs constantly experiment, develop, and iterate a long-term vision. This included introducing the Optimism Collective, launching the OP token via an airdrop, introducing the OP Stack, launching the Bedrock upgrade, and more. Optimism’s long-term strategy stems from its vision for a “Superchain.” The OP Stack, Optimism's modular, open-source, forkable technology stack, allows for the creation of Layer-2 and Layer-3 networks (”OP Chains”). The Superchain is a network of over 30 OP Chains built with the OP Stack that power over 65% of all Layer-2 rollup transactions. The ultimate goal of the Superchain is to bring seamless interoperability between OP Chains that share security, bridging, governance, upgrades, and a communication layer. Website / X (Twitter) / Discord Key Metrics Ecosystem Analysis Onchain Activity Infrastructure was the leading category among transactional activity across active addresses on OP Mainnet once again in Q4 2024. Transactions in this category were up 4.2% QoQ, making up 37.8% of transactional activity on OP Mainnet through applications such as World, Chainlink, and Optimism Governance. Transactional activity across DeFi grew 10.8% QoQ, making up 15.7% of transactional activity on OP Mainnet through applications like LI.FI, Uniswap, and Synthetix. DeFi OP Mainnet’s TVL (USD) increased 11.3% QoQ to $756.1 million in Q4 2024. Due to ETH’s price increasing 28.9% QoQ, TVL (ETH) fell 13.2% QoQ to 226,700. OP Mainnet’s DeFi Diversity score (i.e., the number of protocols making up 90% of a network’s TVL) increased 17.4% to 27 in Q4’24. Aave was the leading protocol by TVL once again, and experienced a 32.6% QoQ increase to $186.4 million. Synthetix ended the quarter with $134.5 million in TVL while Velodrome ended with $91 million. Both Synthetix and Velodrome stayed relatively flat, up 1.2% and down 0.4% QoQ, respectively. Compound and Moonwell were notable outperformers in Q4’24 as their TVL increased 129.1% QoQ to $48.4 million, and 112.5% to $21.2 million, respectively. The “Other” category, which aggregates protocols outside of the top eight, was down 8.5% QoQ to $155.7 million, indicating a consolidation of assets into blue chip protocols like Aave and Uniswap. DEXs OP Mainnet saw an average daily DEX volume of $144.5 million, a 91.9% QoQ increase. Velodrome and Uniswap maintained their historical dominance over OP Mainnet’s spot DEX trading volume in Q4 2024. Velodrome surpassed $20 billion in lifetime trading volume while consistently generating weekly trading volumes and rewards for veVELO tokenholders that were at all-time high levels. The protocol’s share of DEX volume in Q4’24 landed at 57.9% at an average of $84.2 million per day. Throughout H2’24, Velodrome has taken the lion's share of spot DEX trading activity from Uniswap, which led for much of H1’24. Uniswap ended Q4’24 with a 29.3% share of DEX volume at an average of $42.7 million per day. Stablecoins OP Mainnet’s stablecoin market cap continued its uptrend for the fifth straight quarter in Q4 2024, ending up 2.2% QoQ and 126.6% YoY to $1.39 billion. After two quarters of performance dominated by USDT, USDC saw a major resurgence. On Nov. 3, 2024, USDC saw its market cap explode by $175.3 million, or 211.4%. Overall, USDC’s market cap increased 277.4% QoQ to $360.5 million. USDC commanded a 26.5% stablecoin market share on OP Mainnet by the end of 2024, just shy of the 29.2% it began the year at. In contrast, USDT saw a string of large redemptions occurring on Oct. 2, 5, 12, 17, 22, 26, and Nov. 16, before stabilizing and restarting an uptrend. Overall, USDT’s market cap fell 22.4% to $914.7 million, ending the quarter with a 67.4% share of stablecoins on OP Mainnet. Notably, Blackrock launched an OP Mainnet-native version of the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) on Nov. 13, 2024. BUIDL aims to maintain a stable value of $1 per token while distributing accrued dividends to tokenholders wallets every month. OP Mainnet-native BUIDL ended Q4’24 with a market cap of $26.1 million and just two tokenholders. Governance Optimism is governed by the Optimism Collective, a bicameral system comprising the Token House and Citizens’ House, along with stewardship provided by Optimism Foundation. Token House The Token House consists of all OP tokenholders and governs network changes through onchain voting via Agora. OP grants the ability for a tokenholder to delegate OP to themselves or to another delegate. Delegates can vote on proposals related to Governance Fund budgets, network upgrades, inflation adjustments, treasury appropriations, grant clawbacks, council elections, council dissolutions, etc. Token House proposals fall under Non-grant Proposals, or Governance Fund Grant Proposals that distribute OP tokens from the Governance Fund on a seasonal schedule. A new season occurs each quarter and consists of several voting cycles. After beginning in June 2024, Season 6 concluded in December 2024. The voting cycles that occurred in Q4 include voting cycles #29 and #30, while #24, #25, #26, #27, and #28 occurred in Q3’24. Overall, Season 6 distributed 4.98 million OP (0.12% of the token supply) to 30 projects through grants. The season’s Reflection Period is ongoing. Special Voting Cycle 31a concluded on Dec. 18, 2024, while Special Voting Cycle 31b concluded on Jan. 15, 2025. The following notable governance outcomes have been introduced for Season 7 as of the conclusion of Special Voting Cycle 31a: The Intent for Season 7 of Interoperability was ratified with an approved budget of 10 million OP (0.24% of the token supply). The main goal of this Intent is for the Superchain to become a “set of interoperable Stage 1 chains doing $250m per month in cross-chain asset transfers.” Notably, onchain decision markets were approved for Season 7. These markets will experiment with a futarchy model, whereby market predictions of a project’s ability to achieve key success metrics will determine allocations for select grants. Onchain Treasury Execution was approved and tested, allowing for future Optimism Collective treasury distributions to be enacted onchain via governance. The Standard Rollup Charter was approved and ratified. The Standard Rollup Charter is the first Blockspace Charter, aiming to categorize OP Chains into various types with specific implementation details across the Superchain’s blockspace. The Holocene Network Upgrade was approved and went live, introducing several changes related to block derivation, EIP-1559 configurability, and the MIPS contract. Several updates to Token House Councils were made: Operating budgets were approved for the Grants Council, Security Council, and Developer Advisory Board. Notably, the latter two had their budget distributions executed onchain after approval. The Anticapture Commission was approved for another two seasons. Notably, the Anticapture Commission does not operate with a budget. The Milestones and Metrics Council, a new experimental council, was established and had its budget approved. The Code of Conduct Council was dissolved. Season 7 begins after the conclusion of Special Voting Cycle 31b’s veto period on Jan. 22, 2025, and will run until June 11, 2025. The season will operate under the theme of “Shared Success,” and pursue its singular intent surrounding Superchain interoperability. Citizens’ House The Citizens’ House consists of “Citizens,” core Optimism community members (not required to hold OP tokens) that are appointed largely to govern over RetroPGF distributions. These Citizens hold voting badges and operate under a one-person, one-vote system. RetroPGF occurs in rounds, and Citizens vote on which projects should receive funding. Before each round, a scope of funding is determined. The initial rounds of RetroPGF have scope and funding amounts determined by Optimism Foundation, though the foundation plans to hand off this aspect to the Citizen House in the future. RetroPGF 5: In July 2024, Optimism announced RetroPGF 5, where 8.00 million OP (~0.18% of the token supply) were to be distributed to “contributors to the OP Stack.” Final results were announced in October 2024, with 79 participants receiving OP. RetroPGF 6: In September 2024, Optimism announced RetroPGF 6, where between 1.10 million and 3.50 million OP were to be distributed to “contributors to Optimism Governance.” Final results were announced in December 2024, with 88 participants receiving OP. In November 2024, Optimism published an update regarding RetroPGF. Going forward, RetroPGF will shift away from rounds to continuous rewards, aiming to provide greater consistency and predictability for builders. RetroPGF in H1’25 will focus on Developer Tooling (libraries, debuggers, etc.) and Onchain Builders (projects driving Superchain activity). RetroPGF in H2’25 will add a focus on OP Stack Contributions (Ethereum Core Development). Financial Analysis OP Token OP is an ERC-20 equivalent token on OP Mainnet that began circulating on May 31, 2022, with a token supply of 4.29 billion. OP’s circulating market cap increased 7.9% QoQ to $2.37 billion in Q4 2024. However, price stayed flat at $1.75, down 52.8% YoY. This was due to OP’s circulating supply increasing 7.7% QoQ to 1.35 billion, which is a 48.3% YoY change. Notably, Gemini and Bitstamp listed OP in Q4’24, while Grayscale launched the Grayscale® Optimism Trust. The token underperformed the broader market and its Layer-2 peers as its circulating market cap rank fell from 43rd to 50th in Q4’24. This made it the fourth largest Layer-2 token by market cap, behind Mantle (MNT), Polygon (POL), Arbitrum (ARB), but ahead of Immutable X (IMX) and Movement (MOVE). After starting 2024 strong, OP experienced a large drawdown in price in Q2’24. The token ranged for much of H2’24, ending the year down 52.8% YoY. In October 2024, Airdrop 5 went live and distributed ~10.37 million OP (~0.24% of the token supply) worth $15.9 million to 54,723 addresses that transacted on various OP Chains between March and September 2024. Token Uses OP continues to serve functions related to governance and incentives: Governance: Optimism is governed by the Optimism Collective, a bicameral system comprising the Token House and Citizens’ House. The Token House consists of all OP tokenholders and governs network changes through onchain proposal voting via Agora. OP grants the ability for a tokenholder to delegate OP to themselves or to another delegate. Incentives: Optimism stakeholders are incentivized to grow the Optimism ecosystem through the following programs: Ecosystem Fund: 1.07 billion OP (25% of the total supply) were allocated to an Ecosystem Fund designed to stimulate the development of the Optimism ecosystem through four subcategories (Governance Fund, Partner Fund, Seed Fund, and Unallocated Reserves). Retroactive Public Goods Funding (RetroPGF): 859 million OP (20% of the total supply) was allocated to RetroPGF, where funds are distributed by the Citizens’ House to community members that have previously impacted Optimism, based on each round’s scope. Airdrops: 816 million OP (19% of the total supply) were allocated for user airdrops. Eligibility criteria for each round of airdrops vary and are determined by Optimism Foundation. 549.43 million OP (~12.80% of the total supply) remain to be distributed as of the end of Q4’24. Sequencer Optimism Foundation controls the lone sequencer that executes pending transactions stored in OP Mainnet’s private mempool. Blocks of executed transactions on OP Mainnet are created every two seconds and periodically batch-submitted as EIP-4844 blobs to Ethereum by the sequencer. The highlight of the year occurred on March 13, 2024, when Optimism’s Ecotone upgrade was approved and went live, introducing EIP-4844 blobs for data availability after Ethereum’s Dencun upgrade. This was the cause for the 90.8% YoY reduction in average transaction fees to $0.03 on OP Mainnet as Layer-1 submission cost savings continue to be passed down to users. In Q4 2024, sequencer revenue (USD) from network transaction fees fell 22.6% to $2.3 million. With a cumulative Layer-1 submission cost (USD) of just $31,000, Optimism Foundation’s sequencer profit (USD) was $2.2 million in Q4’24, down a similar 23.8% QoQ. Notably, sequencer profits are not retained by Optimism Foundation. Rather, they are distributed to the Optimism Collective’s treasury to fund RetroPGF. Blob Saturation OP Mainnet’s sequencer had a profit margin of 7,232.4% in Q4’24. This was a 66.5% QoQ decrease due to the cumulative Layer-1 submission cost (USD) increasing 122.5%. As Ethereum’s target of three blobs per block was more regularly exceeded, blobspace fees began to be incurred on top of transaction fees for execution. In total, there were 26 days in Q4’24 where the average blobs per block exceeded 3 in a day. Additionally, Ethereum saw activity rise in Q4’24, leading to increased network transaction fees when posting blobs to Ethereum. This combination of factors led to Layer-1 submission costs rising across Layer-2 networks in Q4’24. Still, the amount is negligible when considering OP Mainnet’s Layer-1 submission costs are down 99.6% YoY, and its profit margin is up 29,105%. Ethereum’s Pectra hard fork will include EIP-7691, which aims to increase the target blobs per block from 3 to 6, which could reduce Layer-1 submission costs for a period of time. Network Analysis Usage Average daily active addresses (DAAs) on OP Mainnet increased 6.9% QoQ to 76,600, while daily transactions increased 55.5% to 928,200. The ratio of transactions to active addresses (txs/DAAs_) increased 45.4% QoQ to 12.11, suggesting an increase in “power users” of OP Mainnet; conversely, a decreasing ratio suggests activity is being distributed more evenly across users. Average daily new addresses increased 13.8% QoQ to 16,100, while average daily returning addresses rose by a lesser 5.2% to 60,600. The positive changes in average daily transactions and DAAs indicate that OP Mainnet returned to a state of growth in Q4’24 after a sluggish Q3’24 that saw active addresses drop 41.1%. Overall, average daily transactions ended the year up 173.8% YoY, while average DAAs ended up 6.1%. Technical Developments Optimism averaged 129 weekly active core developers and 177 weekly active ecosystem developers in Q4 2024, which were down 27.2% and 32.8% QoQ, respectively. While Optimism did not undergo any significant network upgrades in Q4 2024, it did share updates regarding native interoperability across the Superchain, which is the Optimism Collective’s central focus in 2025. Specifically, Optimism introduced the following: Superchain ERC-20: An implementation of ERC-7802, a cross-chain token standard proposed by OP Labs, DeFi Wonderland, and Uniswap on Nov. 7, 2024. The Superchain ERC-20 token standard allows tokens to move across the Superchain with limited trust assumptions via native minting and burning on OP Chains. Message Passing Protocol: This protocol enables cross-chain messages on the Superchain using a pull-based event system. A local development environment called “Supersim” allowed developers to experiment with Superchain Interop and native message passing. Interoperable Fault Proofs: This fault proof standard provides security across OP Chains. Notably, while the Holocene Network Upgrade was approved in Q4’24 it only went live on Jan. 9, 2025. Holocene is meant to introduce changes related to block derivation, EIP-1559 configurability, and the MIPS contract. Closing Summary OP Mainnet experienced varied results across key metrics in Q4 2024. Within the ecosystem, TVL (USD) increased 11.3% QoQ to $756.1 million but was down 16.1% YoY. USDC’s market cap surged 277.4% QoQ to $360.5 million, while USDT’s market cap fell 22.4% to $914.7 million. Average daily DEX volume (USD) grew 91.9% QoQ to $144.5 million, which is up 118.4% YoY, led by Velodrome and Uniswap. Financially, the price of OP stayed flat QoQ at $1.75, though its market cap rank fell from 43rd to 50th, underperforming the broader market and its Layer-2 peers. Sequencer profit (USD) fell 23.8% QoQ to $2.2 million. However, users enjoyed average transaction fees of $0.03 in Q4’24, which is down 90.8% YoY due to EIP-4844 blobs. This has resulted in average daily transactions of 928,200, up 173.8% YoY and 55.5% QoQ. At the community level, Airdrop 5 distributed 10.37 million OP tokens worth $15.9 million to 54,723 addresses. Season 6 of governance concluded in December 2024 having distributed 4.98 million OP to 30 projects through grants. Season 7 is slated to begin on Jan. 22, 2025, and will operate under the theme of “Shared Success” while pursuing its singular intent surrounding Superchain interoperability.
Source: Patryk Krasnicki — Published: 2025-01-22T12:00:00ZUnderstanding E Money Network: A Comprehensive Overview
Key Insights E Money Network is a Proof-Of-Stake (PoS) blockchain designed to facilitate tokenization of Real World Assets (RWAs) by integrating Know Your Customer (KYC) and Anti-Money Laundering (AML) processes directly onchain, aiming to bridge the gap between traditional finance and the Web3 space. The network leverages a PoS consensus mechanism with Tendermint BFT, and is EVM-compatible, allowing for the deployment of Ethereum smart contracts, while also providing a modular architecture through the Cosmos SDK, offering developers flexibility and interoperability. Alongside its blockchain, E Money Network offers several core products, including E Money Wallet, EPay, and E Money Card. E Money Wallet is a multichain wallet with integrated KYC/AML and IBAN functionality. E Money Network's diverse partnerships with projects in DeFi, gaming, and RWA tokenization emphasize compliance, interoperability, and secure asset management, strengthening its position as a bridge between traditional and digital finance. Introduction One of the fastest growing sectors in crypto is Real World Assets (RWA). In 2024, RWA TVL increased by 42% from $5.68 billion to $8.07 billion. RWAs have been bolstered by both new project launches and increasing institutional interest. However, despite the impressive growth of RWAs in 2024, the further integration of RWAs remains a complex challenge in 2025. Many existing blockchain platforms lack the necessary infrastructure to support the tokenization of RWAs in a manner that is both compliant with regulations and interoperable across different networks. This gap hinders further adoption of RWAs, limiting the potential for increased liquidity and new opportunities. E Money Network is a Layer-1 (L1) blockchain that seeks to address these challenges by providing a secure, compliant, and interoperable infrastructure for RWA tokenization. The platform aims to bridge the gap between traditional finance and DeFi, offering a comprehensive ecosystem for both individual and institutional users. Background E Money Network, formerly known as Scallop, started with a vision to establish an ecosystem where cryptocurrency users can freely use their digital assets without the obstacles that currently hinder their adoption and usage. The project has since evolved into a modular RWA blockchain infrastructure with compliance standards designed to meet the growing demand for RWAs and facilitate the building of sustainable projects that enable the creation of RWAs and RWA-enabled businesses. The primary goal of E Money Network is to bridge the liquidity gap between Web2 and Web3, enabling the tokenization of RWAs and facilitating their integration into the blockchain space. Scallops’ rebrand to E Money Network was announced in early 2024 and the project team is led by founder and CEO Raj Bagadi, CTO Juri Kopõtko, and CBO Raj Karia, who each brings experience in blockchain development, compliance, and project management. In May, E Money Network announced that it raised $5.2 million in a Bridge Round. Notable investors in the round included Kelsier Ventures, Animoca Brands (who also joined as a lead validator), GBV Capital, Momentum 6, Blockchain Founders Fund, Morningstar Ventures, Kucoin, Blackedge Capital, and Banter Capital. Technology Overview E Money Network is a modular L1 blockchain built using the Cosmos SDK and CometBFT. The Cosmos SDK is an open-source software development kit (SDK) for building sovereign and public PoS blockchains. The Cosmos SDK is used to build a custom application layer, or state machine, while CometBFT is used to securely replicate that state machine on all nodes in the network. CometBFT, an application-agnostic engine, handles the networking and consensus layers through two main components: A consensus algorithm, i.e., Tendermint. A socket protocol, i.e., the Application Blockchain Interface (ABCI). Tendermint validates requests on the source chain and confirms changes on the destination chain. Its consensus provides instant finality and Byzantine fault tolerance. Furthermore, E Money features an EVM-compatible execution environment. Proof-of-Stake Consensus Source: E Money Documents E Money Network employs a PoS consensus mechanism, utilizing the Tendermint Byzantine Fault Tolerance (BFT) consensus protocol. In this system, validators are responsible for validating transactions and securing the chain. E Money Network can support up to 100 validators. Validators take turns proposing blocks of transactions and voting on them. The protocol requires two stages of voting: pre-vote and pre-commit. A block is committed when more than two-thirds of validators pre-commit the same block in the same round. Validators may fail to commit a block for various reasons, such as the proposer being offline or network delays. Tendermint allows validators to establish when a validator should be skipped, relying on a timeout mechanism, making it a weakly synchronous protocol. Tendermint-enabled consensus guarantees safety, ensuring that validators will never commit conflicting blocks at the same height, assuming less than one-third of the validators are malicious. Compliance A core feature of E Money Network is its regulatory compliance as a public-permissioned blockchain. E Money Network is fully compliant with Markets in Crypto-Assets Regulation (MiCa), a comprehensive European Union framework designed to establish harmonized rules for crypto-assets, ensuring investor protection, market integrity, and legal clarity while fostering innovation across the EU. E Money Network directly implements Know-Your-Customer (KYC) and Know-Your-Business (KYB) processes onchain. Both users and applications are required to complete identity verification before transacting on E Money Network. The Regulatory Authority Module (RAM) prevents non-verified accounts and smart contracts from conducting transactions on the network. Verified accounts and smart contracts are whitelisted, and validators are only able to accept transactions from whitelisted addresses. Cross-Chain Bridge To facilitate cross-chain interoperability, E Money Network utilizes a trustless bridge that employs Chainbridge standard contracts. This bridge supports asset transfers over EVM chains, including Ethereum, Polygon, and BNB Smart Chain. The bridge uses ERC20/EMYC20 handlers, relayers, and generic handlers to enable the locking and unlocking of tokens on source chains and the minting and burning of tokens on target chains. Relayers are used for the validation of transfers across the Chainbridge, and generic handlers allow for customizable behavior upon receiving transactions to and from the bridge. Products E Money Network has developed a series of adjacent products to support the E Money ecosystem. E Money Wallet The E Money Wallet is a digital wallet tailored for secure, efficient, and regulatory-compliant transactions within the E Money Network ecosystem. Key aspects of the wallet will include: IBAN-Linked Wallet Addresses - Upon completing a secure verification process involving ID and biometric data, users receive a wallet address on the E Money Network that also functions as an International Bank Account Number (IBAN). This positions the wallet as a "Bank on the Chain," merging conventional banking identifiers with blockchain addresses. E Money Card Integration - The wallet issues cards linked to user wallet addresses, enabling seamless spending of cryptocurrencies in daily transactions. Users can select crypto as a payment option across various platforms, simplifying the use of digital assets for everyday purchases. E-Money Tokens - Fiat-to-token transactions are facilitated using e-EUR tokens. When users transfer traditional fiat currencies to their IBAN address, an equivalent amount of E-Money Tokens is minted at a 1:1 ratio. These tokens enable swift, low-cost global transactions and adhere to regulatory standards. Multichain Support - In addition to the E Money Network, the E Money Wallet will be multichain and support various L1 and L2 networks, such as Ethereum, Solana, Avalanche, and more. Foreign Exchange (FX) and Remittances - Supporting over 100 fiat currencies, E Money Wallet will serve as a versatile solution for foreign exchange and remittance needs. Users can manage currency exchanges and international money transfers efficiently, making it suitable for travelers, cross-border transactions, and sending funds abroad. EPay EPay integrates fiat and cryptocurrency transactions directly into Telegram. This integration allows users to send and receive cryptocurrency, make purchases, and split bills within Telegram chats, streamlining financial interactions without the need to switch between different applications. The system emphasizes user-friendliness and robust security measures to ensure safe and efficient transactions. By embedding these financial services into a widely used messaging app, E Money Pay aims to enhance the convenience of digital payments. E Money Card E Money Card is a card that allows users to spend onchain cryptocurrency balances at supported vendors. These cards are directly linked to users’ wallet addresses within the E Money Network and other supported blockchains, integrating digital assets with conventional payment systems. Furthermore, E Money Card supports USDC on both Solana and Base. The E Money Card is accepted in over 150 countries, and users can earn up to 2% in crypto rewards on purchases. Tokenomics EMYC will be the native token of E Money Network upon mainnet launch. EMYC has a total token supply of 400 million. As a part of the rebrand from Scallop, SCLP tokenholders will be able to exchange SCLP tokens at a 1:1 ratio for EMYC. At TGE, SCLP tokenholders will immediately receive 12% of any converted holdings. Afterwards, each month, an additional 14.67% will be unlocked, and then in the final month (month 6), 14.65% will be unlocked. Further details about EMYC allocations and vesting schedules have not been disclosed as of writing. The EMYC token has various planned utilities: Gas Token As the native token of E Money Network, EMYC will be used to pay gas fees on the network. All gas fees paid on the network are subsequently burnt. Staking & Staking Rewards In order to operate a validator on E Money Network, a minimum of 500,000 EMYC tokens must be staked for a minimum of 30 days. Additionally, users can delegate stake to a validator if they do not wish to operate a validator themselves. Validators and stakers will also receive EMYC tokens as staking rewards. Lastly, validators who engage in malicious behavior or fail to perform their duties properly are subject to slashing, which involves the loss of a portion of their (and delegators’) staked tokens. Governance As a Tendermint PoS blockchain, E Money Network features onchain governance. EMYC stakers will be able to vote on governance proposals that affect the parameters of the network, such as locking, staking, slashing, and more. Other Utilities EMYC will feature numerous other utilities as well, including but not limited to: Participating in regulated crowdfunding campaigns for projects on E Money Network. Discounts on E Money Network apps. Loyalty and reward programs for EMYC tokenholders. Peer-to-peer lending. Payment for NFT mints. The EMYC token’s Token Generation Event is planned for January 23, 2025. Partnerships & Integrations E Money Network has procured a series of strategic partnerships and integrations with varying projects in the ecosystem. These partnerships and integrations highlight the project's focus on compliance, interoperability, and the development of RWA use cases: Solana - E Money Wallet integrated with Solana, becoming the first-ever MiCa-compliant wallet on Solana. This integration allows users to access one of the largest public blockchains in a compliant manner. Plume Network - Plume Network, a public blockchain focused on the tokenization and integration RWAs, is collaborating with E Money Network to enhance user accessibility to its ecosystem. By integrating E Money Network’s fiat-to-onchain accessibility and crypto card services, the partnership aims to streamline transactions and expand opportunities for users. Lumia - Lumia, a full-cycle blockchain for RWAs, is partnering with E Money Network to bridge the liquidity gap between fiat and crypto through E Money Network’s compliant BankFi infrastructure. This collaboration will enable seamless on- and off-ramping of eEUR and other assets. Solana Name Service - Solana Name Service (SNS), the SOL domain service, is integrating with E Money Wallet to bring its 100K+ users a seamless and human-friendly transaction experience. This partnership enables users to register and manage .sol domains directly within the E Money Wallet. Redbelly Network - Redbelly Network is integrating E Money Wallet into its ecosystem to enhance compliant real-world asset tokenization, aiming to streamline the process of bringing real-world assets onto the blockchain. Gala - Gala, a Web3 ecosystem encompassing games, music, and films, is integrating the E Money Wallet to enable users to securely store and utilize their Gala tokens, in-game NFTs, and other digital assets. Patex - Patex, an RWA project in Latin America, is integrating with E Money Network's MiCA-compliant blockchain ecosystem to enhance financial inclusivity and innovation in the real-world asset (RWA) space. ZetaChain - ZetaChain, an L1 blockchain for chain abstraction, has partnered with E Money Network to enable developers to build simple, secure omnichain applications, enhancing compliance-driven innovation in Web3. Yescoin - Yescoin, a Web3 gaming ecosystem with over 13 million users, is partnering with E Money Network to enable seamless swaps of YESCOIN and rewards for fiat (eEUR) via the E Money Wallet. Other Partnerships - In addition to the above, E Money Network has also formed partnerships with WeFi, Kima Network, MAIV Finance, RWA Inc., Chorus One, zkCross Network, Xend Finance, Sheertopia, Sharpe AI, PlayZap, Buk Protocol, and Kvants. Roadmap E Money Network's roadmap includes several key milestones aimed at expanding its ecosystem and enhancing its capabilities. The project is focused on the upcoming launch of its beta mainnet, which will serve as the foundation for future applications. The launch of the native EMYC token is also a key priority, with the transition from SCLP to EMYC being a significant step in this direction. The E Money Wallet is also set to receive integration for E Money Cards. In the longer term, E Money Network aims to become a leading platform for RWA tokenization, focusing on interoperability and building a comprehensive ecosystem for compliant Web3 applications. E Money Network partially aims to achieve this through its $2 million RWA Grant Program. This initiative invites developers to submit proposals, with selected projects receiving grants ranging from $5,000 to $50,000, along with mentorship, legal and compliance support, and marketing assistance. The program aims to accelerate innovation in the RWA ecosystem by fostering the creation of compliant and efficient digital asset solutions. Closing Summary E Money Network is attempting to address the challenges of RWA tokenization by providing a compliant, interoperable, and secure infrastructure. The project's focus on on-chain KYC/AML, MiCA compliance, and bank-grade security positions it as a potential leader in the emerging RWA space. The integration of the E Money Wallet, with its multichain support and IBAN functionality, aims to provide a seamless user experience for both crypto and traditional finance users. The use of Tendermint BFT consensus, EVM compatibility, and a modular architecture through the Cosmos SDK provides a robust and flexible platform for developers. The project's strategic partnerships and focus on community engagement highlight its commitment to building a comprehensive ecosystem. The launch of the EMYC token and the upcoming mainnet launch are key milestones in the project's roadmap. Overall, E Money Network presents a compelling approach to RWA tokenization, with a strong emphasis on compliance, interoperability, and security. The project's success will depend on its ability to execute its roadmap, build a thriving ecosystem, and navigate the complexities of the evolving regulatory landscape.
Source: AJC — Published: 2025-01-17T15:30:11Z