@Coingecko's Q1 Report in Focus: Decentralized Applications

The great team over @coingecko continues to provide great insight and value to all those in the cryptocurrency and blockchain space with not only their continued development of their versatile website but also with yet another Quarterly Report on the first quarter of 2019 which was quite interesting when we review in retrospect as it marked the first positive quarter for most cryptocurrency prices since 2017. It also marked the return of crowdfunding with strong demand from the newly minted IEOs instead of the traditional ICOs which have fallen under regulatory scrutiny ever since their booms in 2017 and 2018. However, among the interesting reviews done in their Quarterly Report was a great analysis of Decentralized Applications in the most popular platforms that include our very own Steem. It provides some interesting perspective when reviewed on a level playing field.

The information provided on the report is with the collaboration with the @dapp.com team which also continues to develop their community around the decentralized platforms creating applications for their users. They have already launched their token as well which has been an interesting to witness and yet another example of the power that blockchain technology can bring to communities seeking to leverage the decentralization of many opportunities that exist in traditional platform. While the focus for most platforms in these early stages have been around gambling Dapps, we have started to see further development that broadens the platforms into other categories such as gaming, social, tools, and of course exchanges.

As we see the market summary, it is impressive to see that the amount of transactions exceeded 290 million in the quarter which averages over 3 million per day. The volume in value exceeded $3 billion which is quite significant if you consider how much of a milestone it is in traditional markets to surpass $1 billion in revenue on an annual basis! Total Dapps now surpass 1,900 with most being active (1,304) which is encouraging to see. What is probably the most significant metric here is the fact that 504 new Dapps were created in the period which represents 25% of the total. This demonstrates how development continues to attract investments into the space as the search of “the killer app” continues to progress towards more adoption in the blockchain space.

Unfortunately, the majority of the activity is dominated but gambling Dapps. While it is great to see the growth in the area, I believe that gambling alone cannot bring sustainability not adoption alone to the markets surrounding blockchain and cryptocurrencies. Gambling transactions accounted for 77% of all during the quarter with even more (85%) in terms of value in US dollars. This, in addition to exchanges representing another approximate 10% of transactions, could be a problem for the sustainability due to the potential of some sort of regulatory intervention. While the advantage of being decentralized is the fact that jurisdiction could be a gray area for regulation, it could lead to noise around the platforms which we have seen to be detrimental in the past as FUD can often disrupt positive momentum. These metrics will be interesting to monitor as we progress throughout the year and platforms continue to grow and increase users. In addition, users seem to be attracted to other types of categories as only 54% of active users are involved with gambling. This could signal potential growth to come in activity and communities to other categories.

One of the criticisms we often hear about blockchain in general is the amount of adoption, even within those that have opted to participate in the technology. This is clearly demonstrated on the Dapp-based platforms very clearly as despite achieving over 2.3 million users, only 819k have remained active this last quarter. This churn being experienced has clearly worsened as the bear market has taken over since the high of late 2017 and early 2018. As we have clearly seen here on our own ecosystem, activity in usage and remaining active clearly correlates with price. However, it will be interesting to see if this trend stabilizes as we have seen here and as development continues to push the boundaries of the ecosystems and broaden the experiences we are offered thanks to the continued development.

While we will need to measure the metrics as they continue developing in the coming quarters, the figures being demonstrated are encouraging for the overall market. What is interesting to see is that the leader is Dapp platforms, Ethereum, seems to now have some competition. After the largest ICO ever, EOS has started to develop many Dapps to support the usage of their platform. With over a billion dollar committed to develop the platform, developers have been attracted to EOS in hopes that the scaling options will allow more adoption to occur given the lower costs to perform transactions. However, two less probably platforms have developed to be prominent competitors; Tron and Steem have started to have interesting metrics in terms of Dapps and in activity. In fact, I tend to believe that the these have the strongest communities in term of passion and commitment which may be an indicator of their growth in user activity metrics. What is clear is that the game for dominance is far from over as they each have their strengths and competition will continue to appear as the likes of NEO, Cardano and others are just around the corner.

This great analysis put together by the @coingecko and @dapp.com teams have made me reflect about an additional factor not intrinsically present in the report, valuations. At the time I write this post, Ethereum commands the second largest market capitalization with almost $18 billion in value. EOS is 4th but with only a third of the valuation at $5.3 billion while Tron is 11th at $1.6 billion. Unfortunately, Steem is no longer in the top 50 with only a $126 million market capitalization. Looking at the metrics presented above, you would think that some of these market capitalizations would be closer together or demonstrating more value in the markets. I would seem too biased to highlight the clear undervaluation that Steem seems to have but would also highlight that it could be very well the opposite for others. Seeing the data makes me think that Ethereum may actually be overvalued when compared to its peers. Without the premium formerly commanded by the ICO craze, Ethereum may be losing its footing on commanding the attention of the community although they continue to command the most amount of developers which is what is driving demand.

I only concentrated on the slides regarding decentralized applications on the quarterly report but want to take the opportunity to tell the community to spend time on reviewing the report closely as it has plenty of great information regarding a number developments that occurred during the first quarter. For example, they go into detail about the MimbleWimble protocols that launched and also some great insights regarding the new IEOs coming from the exchanges. In all, the @coingecko quarterly reports continue to be a must see for all those seriously involved in the cryptocurrency and blockchain markets. I would like to thank them for being part of this community and providing great information for the ecosystem to learn. Lastly, great to see them continuing to engage the Steem community with great opportunities to participate in their contests!

Discord: @newageinv#3174

Chat with me on Telegram: @NewAgeInv

Follow me on Twitter: @NAICrypto

The following are Affliate or Referral links to communities that I am a part of and use often. Signing up through them would reward me for my effort in attracting users to them:

If you are like me and interested in continued personal growth, invest in yourself and lets help each other out by leveraging the resources Minnowbooster provides by using my referral link

Start your collection of Steem Monsters today at my referral link

Try the Partiko Mobile app to engage while on the go with my referral link

The dice game that has captured the attention of many Steemians is here! Earn your tokens and try your luck here!

Check Out the New Way to Interact with Other Social Media using my referral link

Get started on the latest game on the blockchain Drug Wars by signing up here!

If you select one of my above referral links, I will sponsor a @steembasicincome SBI in return. Let me know if you do so in the comments below!

_{^{DISCLAIMER: The information discussed here is intended to enable the community to know my opinions and discuss them. It is not intended as and does not constitute investment advice or legal or tax advice or an offer to sell any asset to any person or a solicitation of any person of any offer to purchase any asset. The information here should not be construed as any endorsement, recommendation or sponsorship of any company or asset by me. There are inherent risks in relying on, using or retrieving any information found here, and I urge you to make sure you understand these risks before relying on, using or retrieving any information here. You should evaluate the information made available here, and you should seek the advice of professionals, as appropriate, to evaluate any opinion, advice, product, service or other information; I do not guarantee the suitability or potential value of any particular investment or information source. I may invest or otherwise hold an interest in these assets that may be discussed here.}}