Summer is over, and September is often a fresh beginning, not only in our daily lives but also in markets. This year, we close out the summer in the middle of a bull run, with clear signs that the industry is entering a new phase of growth.
Onchain activity may have cooled slightly in August, but beneath the surface the story is very different. DeFi reached all-time highs, institutions are entering the space at scale, NFTs are heating up again, and AI dapps are evolving fast, even as hype cycles shift. At the same time, security challenges remind us that the industry is still maturing.
The data shows one thing clearly: Web3 is not standing still. As we step into autumn, the dynamics of this bull run are becoming sharper. These aren’t just defined by speculation, but also by adoption, innovation, and real capital flowing onchain.
Key Takeaways
- Daily Unique Active Wallets (dUAW) dropped 18% in August to 17 million, signaling a summer cooldown in onchain activity.
- Gaming regained dominance in activity, despite a slight 4% dip, while NFTs rose 7% and Social dapps fell 63%.
- DeFi TVL hit an all-time high of $292B in August, up 13% from July, driven by Ethereum’s strong performance.
- Crypto market caps broke records: total cap reached $3.82T, while non-BTC assets hit $1.59T, surpassing the 2021 peak.
- Ethena’s USDe supply grew 42% to $12.4B, generating $61M in revenues, cementing its position among DeFi’s most profitable stablecoins.
- NFT trading volume climbed 9%, with Courtyard surpassing Ethereum blue-chips to lead all collections.
- $159M lost to exploits in August, a 20% increase from July, with a single phishing scam accounting for $91M.
Table of Contents
- Dapp industry cools in August
- DeFi hits all-time highs, while institutions step in
- AI dapps cool down in August
- NFTs gain momentum as Courtyard makes history
- Web3 exploits rise 20% in August
- Closing words
Dapp industry cools in August
August closed with a noticeable cooldown across the onchain landscape. The dapp industry saw daily Unique Active Wallets (dUAW) drop by 18%, settling at 17 million.
Two sectors felt the biggest hit: Social dapps fell by 63% and AI dapps by 49%. While the decline was surprising, it also fits into the natural cycle. Both sectors had enjoyed months of rapid growth and hype, but sustaining that momentum and level of engagement is a huge challenge. The vision behind these two product categories remains exciting. They’re likely to reshape the industry in the long term, but for now, the dip shows how early we still are in their journey.
On the flip side, other categories gained ground. NFTs grew by 7% in activity, reclaiming the second spot in sector dominance. We see this as a surprising rebound, considering the market’s slowdown earlier this year. Gaming dapps, although down slightly by 4%, re-emerged as the dominant sector by activity, showing the resilience of this category as a backbone of onchain engagement.
Looking at the top dapps by activity in August, we see a familiar mix of names across DeFi, Gaming, Social, and AI. No single category dominates entirely, underlining the current state of the industry: a diverse but balanced ecosystem where every sector is testing its unique edge.
DeFi hits all-time highs, while institutions step in
August confirmed what many suspected, DeFi is operating at all-time highs. Total Value Locked (TVL) reached $292 billion, a 13% increase from July, powered largely by Ethereum’s strong performance. Both DeFi’s TVL and ETH closed the month at record levels, underlining the sector’s momentum.
Zooming out, the broader crypto market is also signaling strength:
- Total market cap including BTC rose 4% in 30 days, hitting $3.82 trillion, an all-time high.
- Excluding BTC, market cap jumped 15% to $1.59 trillion, just edging out the previous peak from November 2021.
- Excluding BTC and ETH, market cap climbed 9.41% to $1.05 trillion, also reaching a new record.
The takeaway? Ethereum continues to drive outsized growth, while altcoins remain largely dormant. However, on since the start of the year the altcoin market cap went only up 12% Therefore it feels like we’re mid-bullrun, the point just before altcoins typically start accelerating.
Beyond market stats, August also delivered a wave of product and institutional milestones:
- Protocol innovation: Uniswap’s Unichain activated Flashblocks, enabling 200ms block confirmations with CEX-like speed and MEV resistance, an upgrade also adopted across Base and other OP Stack chains via Flashbots. In addition, Pendle Finance expanded on Arbitrum with Boros, allowing users to trade perpetual funding rates directly onchain. Lastly, Synthetix announced its return to Ethereum mainnet with a new perps exchange, showing the hybrid L1–L2 experimentation is far from over.
- Institutional adoption: Aave Labs launched Horizon, an institutional borrowing platform opening access to tokenized Treasuries and RWAs. Aave Horizon has heavyweights like VanEck, WisdomTree, Hamilton Lane, Circle, and Ethena on board. In addition, Ripple’s RLUSD stablecoin joined Horizon’s RWA market, expanding collateral options. Meanwhile, Chainlink deepened its role as crypto’s core data layer by integrating Intercontinental Exchange’s (ICE) consolidated feeds for FX and metals, bridging TradFi-grade data with DeFi infrastructure.
- Stablecoins and yield: Ethena’s USDe supply ballooned 42% to $12.4B, generating a record $61M in protocol revenues in August. Its rapid growth cements USDe as one of the most profitable and debated stablecoin models in DeFi, sparking ongoing discussions on sustainability and fee capture.
This bull run feels different. Unlike past cycles, institutions are now shaping the market narrative and infrastructure. No longer is market growth dominated by retail, but instead its innovative financial products, investment funds and governments that are embracing the technology.
AI dapps cool down in August
AI has become one of the most transformative forces of our time, reshaping not only technology but also daily life. However, on the blockchain August brought a slowdown. As mentioned in the industry overview, AI dapps saw activity drop by 49%, showing that even the hottest sectors are not immune to cycles. Still, top AI projects remain highly ranked, and new entrants continue to push the boundaries of what’s possible.
Among the newcomers this month:
- Vibely: an AI companion designed to ease loneliness and anxiety.
- Calories Cash: a Telegram-based AI agent where users snap a photo of their meal, get calorie estimates, and earn token rewards.
But this month’s headline story came from Numerai, the decentralized hedge fund built entirely on machine learning models contributed by thousands of data scientists. Numerai secured a $500 million allocation from JPMorgan Asset Management, nearly doubling its assets under management and sending its NMR token soaring more than 100% within days. The fund’s performance is powered by AI models staked with NMR, meaning JPMorgan’s backing is not just capital inflow but a validation of AI-driven asset management coordinated through blockchain incentives.
At the infrastructure layer, Render Network expanded into AI by trialing U.S.-based compute services, onboarding high-end GPUs to support decentralized machine learning. This pivot beyond graphics rendering positions Render as a credible alternative to cloud giants, with node operators rewarded in RNDR. Similarly, Bittensor rolled out a new governance module (dTAO), giving token holders more control over upgrades and reinforcing TAO’s coordination role across the decentralized AI ecosystem.
The Artificial Superintelligence (ASI) Alliance, a coalition of Fetch.ai, SingularityNET, and Ocean Protocol, focused on developer engagement. August hackathons showcased AI agent use cases spanning DeFi automation to decentralized data sharing. While FET’s token remained stable, the ecosystem’s $50M buyback program and collaborative governance framework set a strong foundation for long-term growth.
Bottom line: even as usage cooled, AI in crypto is maturing quickly. Institutional capital, decentralized infrastructure, and active communities are now driving the sector’s evolution, signaling that this isn’t just hype, but a sustained build phase for decentralized AI.
NFTs gain momentum as Courtyard makes history
Momentum in the NFT market kept building in August. Trading volume rose 9%, even as NFT sales count dipped by 4%, showing that while fewer assets traded hands, collectors are paying more per sale.
This makes July and August the strongest months since February 2025 for NFTs, both in volume as in sales count. The signs are clear: people are returning to the NFT space. Part of this resurgence comes from mainstream adoption. In Ibiza, the world-renowned nightclub Hï opened the first permanent NFT art gallery inside a club, in partnership with The Night League and London’s W1 Curates. Works from leading crypto artists like Beeple, Mad Dog Jones, WhIsBe, and KidEight are showcased through immersive digital installations, a symbol of NFTs moving beyond Web3-native spaces.
Another driver is Base, where low minting costs and speculation around an upcoming airdrop have spurred NFT activity. Base has now climbed to become the third-largest chain by trading volume, highlighting how scaling solutions are shaping NFT adoption.
Ethereum remains the powerhouse, commanding 61% dominance in the NFT industry. In August, developers introduced ERC-8004 “Trustless Agents,” a proposed standard to assign NFTs as unique onchain identifiers for autonomous programs. This could allow AI systems and dapps to safely recognize and interact with one another using NFT-based IDs and reputation layers, and we’re proud to announce that we will be involved with this as well with our AgentRadar.
Elsewhere, Solana showed progress on scalability, successfully stress-testing over 100,000 TPS, 10× higher than previous averages. The move positions Solana as a serious contender for hosting large-scale NFT and gaming markets. On the product side, Solana wallet Phantom acquired NFT analytics platform Solsniper, planning to integrate its wallet-tracking and sniping tools into the Phantom app.
On the marketplace front, Blur overtook OpenSea, capturing 22% of total NFT trading volume, fueled by aggressive feature rollouts and liquidity incentives. Meanwhile, OpenSea launched a beta of its Model Context Protocol (MCP) server, an open standard delivering real-time NFT and wallet data to AI applications across 20+ chains, placing itself at the intersection of NFTs and AI.
Among collections, the biggest surprise came from Courtyard, which became the top NFT collection by trading volume, surpassing even Ethereum’s blue-chips. Courtyard’s momentum was amplified by its $30 million Series A raise in late July, aimed at scaling its model of bringing real-world collectibles onchain with instant liquidity and verifiable provenance. The rise of Courtyard, along with platforms like Phygitals on Solana, points toward RWAs (Real-World Assets) as the defining NFT trend for late 2025.
Blue-chip collaborations also made headlines. Azuki partnered with Swiss watchmaker H. Moser & Cie to launch “Elements of Time,” a series of Ethereum-connected luxury watches. Each piece comes with an NFT-based Physical Backed Token (PBT) that certifies authenticity and ownership.
Generative art also reached a milestone. Art Blocks announced its upcoming 500th project and five-year anniversary. The “Art Blocks 500” series, slated for November, will span all six of its categories and mark the end of its Curated series, signaling the close of the first era of onchain generative art.
Conclusion? The NFT market is heating up again.
Web3 exploits rise 20% in August
August brought another difficult month for security in Web3. According to the REKT Database, losses from hacks and exploits reached $159 million, a 20% increase compared to July. However, when compared to the months before that, the numbers for August don’t stand out.
The standout case in August was a massive phishing attack that accounted for 57% of total losses. The victim lost 783 BTC (~$91M) in a sophisticated social engineering scheme, where attackers impersonated exchange and hardware wallet customer support staff. The theft came exactly one year after the $243M Genesis Creditor exploit, with the stolen funds already being laundered through privacy-focused mixers such as Wasabi Wallet.
The second-largest incident hit Turkish exchange BtcTurk, which suffered a suspected hack worth around $48–50 million. The stolen assets came from the platform’s hot wallets. While deposits and withdrawals were halted during the investigation, local fiat operations and trading services remained active.
Another notable exploit targeted Odin.fun, a Bitcoin-based memecoin launchpad and trading platform. Attackers manipulated liquidity in its automated market-making tool, stealing 58.2 BTC (~$7M). Early reports suggest the exploit may have originated from entities based in China.
Once again, this month underscores the importance of security awareness in Web3. From phishing to hot wallet breaches, threat actors are evolving their tactics. Always safeguard your assets, double-check communication sources, and use secure storage. For practical tips, we recommend reviewing our security guides:
- How to Prevent Scammers from Draining Your Wallet
- 8 Ways to Check If It’s a Token Scam
- Scam Prevention and Web3 User Safety Guide
DappRadar offers an extra security layer when engaging with dapps. Don’t look them up through Google, which makes you prone to scams and cyberattacks. Instead use DappRadar to find dapps, and ensure you reach the correct website.
Closing words
August highlighted just how dynamic the dapp industry remains. While overall activity cooled, DeFi surged to all-time highs, NFTs regained momentum, and AI dapps continued to attract institutional attention despite a drop in usage. At the same time, security risks reminded us that vigilance is more important than ever.
However, we need to point out that this cycle ‘feels different’. Institutions are no longer watching from the sidelines, they’re actively shaping the market through capital, partnerships, and infrastructure. As we move into the last quarter of 2025, the interplay between retail trends, institutional adoption, and technological breakthroughs will define where the industry goes next.
One thing is clear: onchain innovation isn’t slowing down.
