Ethereum network revenue plummeted in Q2 2023, due to a shrinking DeFi market. Ethereum’s average daily active addresses decreased by 6%, and its inflation rate decreased by 213%, from 0.71% to -0.8%. Ethereum co-founder Vitalik Buterin proposed a method to simplify cryptocurrency wallets.
Ethereum network revenue fell 33.3% year-on-year during Q2 2023. Bankless disclosed the figure in the report, which also shows a decline in average daily active addresses.
A Bankless report shows that Ethereum network revenue fell 33.3% in the second quarter of the year. The value fell from $1.27 billion to $847 million.
Ethereum Network Income Affected
The most significant statistic in the report is the fact that network revenue fell 33.3% compared to Q2 2022. Network revenue is the total value of transaction fees that users pay to Ethereum validators, including any corresponding fees that are burned.
The second quarter was a lean period for the DeFi market, which likely contributed to the decline in revenue for the network.
Another notable statistical data is the 6% drop in average daily active addresses on the network. The Ethereum inflation rate also decreased by 213%, from 0.71% to -0.8% on average. This is the growth in the supply of ETH.
It may not have been the strongest quarter for Ethereum, but the network is still the undisputed champion of DeFi. It has shown resilience in what has been a difficult year.
DeFi Sector Increased its Dominance from 23% to 32% in Q2 2023
In a report published by the DappRadar portal, the decentralized finance sector is shown to have increased its dominance in the second quarter of 2023, going from 23% to 32% dominance in the cryptographic market.
The report credits this growth to a resurgence in memecoins, as well as “airdrop hunters.” The Total Value Locked in decentralized finance has decreased by 7.1% compared to the previous quarter, reaching 77.6 billion dollars, according to the data included in the report.
In this dominance of DeFi in the ecosystem, the participation of the Ethereum chain stands out. Despite this dominance, the numbers also highlight that there was a decline of 2%, going from 55.8 billion dollars in the first quarter, to a drop to 54.5 billion dollars in the second quarter.
Ethereum Monthly Burn Exceeds 146,000 ETH
Ethereum has surpassed 146,000 ETH in its average monthly burn, with a total of 3,472,331 ETH burned so far. The total amounts to 6,500 million dollars. This is a considerable sum since the mechanism was introduced with the EIP-1559.
EIP-1559 arrived with the London hard fork in August 2021 and is responsible for turning Ethereum into a deflationary network. The vast majority of burns come from typical ETH transfers, NFT activity on major platforms like OpenSea, and high-volume DEXs.
Ethereum co-founder Vitalik Buterin also recently proposed a method to make cryptocurrency wallets easy to use. This method is similar to using an email id. Buterin made the remarks at the Ethereum Community Conference (ETHCC) in Paris.
The method in question is called “modern account abstraction”, which Buterin describes as “really elegant”. It could possibly allow wallet recovery to be as simple as resetting an account password. It may be a long way off, but there is no doubt that this would help Ethereum’s revenue.
By Audy Castaneda
