Welcome to our deep dive into the dapp landscape of January 2025, a month marked by thrilling peaks and daunting troughs. The crypto world felt the chill of a market downturn, witnessing a 6% drop in daily active wallets from December, yet amidst this cooling market, DeFi stood resilient, uniquely bucking the trend with increased activity.
In January, AI dapps emerged as the new darlings, engaging over 2.2 million wallets and signaling a potential new era for growth. But that’s just scratching the surface. Did you know that despite a significant drop in NFT trading volume, some collections like Azuki and Milady Maker thrived thanks to strategic airdrops? Or that while Ethereum leads in NFT volume, Base is making waves with a doubled trading volume?
Dive deeper with us to uncover the stories behind these numbers, the rise of new blockchain ecosystems, and what this all means for the future of dapps. Keep reading to see how these trends could shape the Web3 world.
Key takeaways
- January 2025 saw a 6% decline in average daily unique active wallets from December, totalling 26.7 million. Only DeFi showed an increase, while games, Social and NFTs declined.
- DeFi and gaming led the market in January 2025, with DeFi capturing 28.1% and gaming 27.8% of all active wallets.
- Despite a general market downturn, DeFi was fuelled by narratives around memecoins and AI agents. However, TVL across major blockchains decreased, with Ethereum dropping by 23.5% to $112.9 billion and Solana by only 4% to $21.4 billion.
- NFT trading volume nearly reached $1 billion, down 27% from December, but sales count only dropped by 6%. Airdrops significantly influenced trading volumes for collections like Azuki and Milady Maker.
- Ethereum leads in NFT trading volume with $586.3 million, despite a 37% drop from the previous month. Base was a notable performer, doubling its volume.
- AI dapps saw interaction from 8.5% of active wallets, with over 2.2 million wallets engaging. This category is expected to grow, showing significant potential beyond current applications.
- Security breaches in January 2025 led to a 463% increase in incidents month-over-month, with losses totalling more than $62 million, highlighting ongoing security challenges in the Web3 space.
Table of Contents
- January 2025 – dapp industry overview
- Crypto dump, AI agents and memecoins fuel DeFi activity
- Total value locked dropped across the industry
- Airdrops fuel NFT trading for top PFP collections
- AI dapps to become a major growth sector
- Security incidents up 463% month-over-month
- Closing words
January 2025 – dapp industry overview
The first month of 2025 has been one with many ups and downs. The month started slow, then there was lots of momentum when Trump came into office. But, unfortunately, that momentum quickly faded for a price drop as we moved into February.
Looking at the average number of daily unique active wallets, we’re seeing a 6% decline from December. Only the DeFi segment managed to increase their total number of active wallets, while other categories such as games, AI, and NFTs have seen a decline. The average number of daily unique active wallets for January 2025 reached 26.7 million.
When compared to January 2024, this is a huge increase year-over-year. Particularly the categories games, DeFi, social and AI have seen lots of growth over that period.
When it comes to market dominance, DeFi and games have been leading the market. In January 2025, 27.8% of all the active wallets interacted with gaming platforms. However, leading the market is still the DeFi segment, attracting 28.1% of all the active wallets.
As more gaming projects launch and interest increases beyond airdrop farming, we can expect further growth for the gaming segment. At the same time, DeFi projects are becoming more sophisticated, offering services akin to those from centralized exchanges. The rise of memecoins and the hype surrounding AI agents have brought two prominent narratives to the market that give DeFi a boost.
In January, DappRadar welcomed new blockchain ecosystems to the World’s Dapp Store, including Abstract, MultiversX, and Soneium. This now brings the total number of chains tracked by DappRadar to 80. Over the past 30 days, Soneium attracted 260,950 active wallets, placing it in 26th place in our Chain Rankings.
MultiversX saw a 16% drop over the same time period, reaching a total of 55,660 active wallets. Lastly, since its launch late January, Abstract attracted a total of 45,050 active wallets engaging with dapps.
Crypto dump, AI agents and memecoins fuel DeFi activity
The DeFi sector, without a doubt, is one of the fundamental building blocks of Web3. Enabling tokens to move between chains, or swapping them for another type of token, allows any participant to position themselves properly. In January, we’re seeing a red market across the board. Every blockchain ecosystem in the top 10 has seen their total value locked (TVL) plummet.
With a 3% drop in TVL, the Bitcoin ecosystem remained the most unfazed with its TVL of $6.5 billion. However, that’s currently not the market where the most DeFi action takes place. Ethereum, often praised as the leading chain for DeFi, noted a 23.5% drop in TVL, now reaching $112.9 billion.
With just a 4% drop in TVL, the Solana ecosystem survived the January drop the best. Solana now has a TVL of $21.4 billion, and currently sees lots of activity through DeFi services like Raydium, Jupiter Exchange, Chingari and the Pump.fun token launchpad. It’s no surprise that we see these dapps in the Top 10 most used dapps of January 2025.
Shopping app KAI-CHING has been a prominent member in our Rankings for quite some time, while gaming platform KGeN has been climbing the charts. The dominance of the DeFi segment can be clearly seen in the list of top 10 dapps for January 2025.
Total value locked dropped across the industry
As mentioned, we’ve seen the total value locked in smart contracts plummet across the DeFi industry. Ethereum saw a drop of 23.5% to $112.9 billion, while Solana remains the strongest in the market with only a 4% drop to $21.4 billion.
Growing ecosystems with a less solid foundation have seen the biggest drops. Aptos noted a 34% drop in its TVL to $1.44 billion, while Sui Network recorded a 36.5% drop and reached a TVL of $2.37 billion. These ecosystems have clearly been hit the hardest, and this emphasizes the need for solid DeFi foundations to fuel and build ecosystems.
These drops in TVL can be explained by looking at the crypto market. Total Value Locked is strongly linked to the price action of crypto tokens. Native ecosystem tokens like Optimism’s OP, Arbitrum’s ARB token and SEI from Sei Network, have seen their value drop by 40-50%. The same goes up for Aptos, NEAR Protocol, Avalanche, Polygon, and Immutable zkEVM. While Ethereum’s ETH token has seen its value plummet more than 26%.
Airdrops fuel NFT trading for top PFP collections
The heavy price drops in crypto have had a reflection on NFT trading. In the blockchain space, most action takes place around a dominant narrative. Over the past few months NFTs have been making somewhat of a comeback, but in January the non-fungible tokens seemed to have lost some traction.
The total trading volume for the NFT market almost reached $1 billion. However, that’s a 27% drop from the December numbers. Of course NFT trading shouldn’t only be measured in dollar values. As mentioned, crypto prices have dropped and this also reflects on the NFT market. Yet, in January the number of sales only dropped 6% from December, which indicates continued user engagement despite the lower volumes.
Looking at the top 5 NFT collections by volume, we see Azuki and Milady Maker and stand out performers. The Azuki community gained access to the ANIME token airdrop from the Anime Foundation, which pushed interest and resulted in $133 million in trading volume for the main Azuki collection. That’s a 45% increase from December. Also the Azuki Elementals recorded a good month with $41.17 million in trading volume, up 12.3%. In addition, Milady Maker noted a 82% increase in trading volume, reaching $30.6 million.
Among the Top 5 collections, there was a lot of talk surrounding Pudgy Penguins and the Lil Pudgys in December 2024. The newly dropped PENGU token kept people engaged. Even though demand for Pudgy Penguins is still clearly there, trading volumes have dropped over 60% for both collections.
Simply looking at the Top 5 NFT collections by trading volumes signals one trend. Demand for PFPs, or simply profile picture NFTs, is still huge. These types of NFTs account for 81% of all the trading volume in the NFT market.
However, when we look at the number of traders for all the NFT collections, we see a completely different side of the market. Market leader Sorare, a card-based fantasy football game, noted a 12.8% drop to 36,360 active card traders in January. While Axie Infinity (36,210 traders) and the Axie Infinity Axie collection (36,040 traders) complete the top three. In fourth place we find Guild of Guardians Heroes, the game characters for the Guild of Guardians mobile game, with 14,040 traders.
These four NFT collections have all seen their numbers drop. The only exception to this trend is Chainbase Mystland, a newly launched collection on Base which recorded 31,270 sold items by 9,850 traders. However, with a volume of less than $32,000, Chainbase Mystland doesn’t come close to the millions dollar economies from the Sorare, Guild of Guardians and Axie Infinity.
As most trading for expensive PFPs takes place on Ethereum, it should not come as a surprise that Ethereum is still the leading blockchain by NFT trading volume. With $586.3 million in trading volume, Ethereum saw its volume drop by 37% month-over-month. However, with this volume, Ethereum is still well ahead of Bitcoin and the Ordinals ecosystem. DappRadar recorded $133 million in trading volume from Bitcoin Ordinals.
In the top 5 we also find Polygon in third place with a 4% drop to $42.55 million, while Base and Immutable zkEVM complete the Top 5. Trading volumes on Immutable zkEVM dropped 20% to $30.3 million, while Base is the major exception this month. The Base ecosystem doubled its trading volume month-over-month to reach $41.8 million.
The success of the Base ecosystem comes from a Mylady Maker-inspired collection, called Wealthy Hypio Babies. This collection alone recorded over $16 million in trading volume, despite launching in January. The average sale price for these NFTs now exceeds $2,800.
With $996 million in trading volume, January 2025 wasn’t out of the ordinary when compared to previous years. The trading volumes in 2023 and 2024 reached similar numbers in the first month of the year. However, there’s a major difference, and that’s the sales count. This January we recorded 3.1 million sold NFT assets, while one year ago that was almost 5.4 million. To make things worse, with 8.2 million sold NFTs the first month of 2023 was much better.
Even though the number of NFTs sold has dropped considerably over the year, it’s still interesting to look at the most popular NFT categories. Sports leads the pack with 615,209 NFTs sold, while Games follow in second place with 480,262 sold items. PFPs, responsible for the lion’s share of the industry-wide NFT trading volume, end up in third place with 72,921 sold avatar pictures.
AI dapps to become a major growth sector
DeFi took its moment in the spotlight in the summer of 2020, while NFTs became the talk of the town in 2021. After that we entered a brutal bear market. Now, artificial intelligence could be the catalyst for a new bullrun. Every major tech company is testing the waters, including Google, Meta, X, Amazon, and the list goes on. Of course we’re also seeing lots of AI adoption in Web3.
In January, 8.5% of all active wallets interacted with AI-powered dapps. That means that over 2.2 million wallets have engaged with such applications. This places the AI category above SocialFi, which has been part of our reports for many months. Even though the impact and importance of AI in the dapp space has yet to be crystalized, we believe this category is poised to grow further.
The categorization of AI dapps is still a bit vague, but through our Rankings everybody can follow the trend. Among the top AI-powered dapps we find AI agent platforms, but also virtual influencers, social networks, and gaming apps.
With 28.6 million unique active wallets LOL leads the pack, followed by email platform Dmail Network (4.9 million), and virtual influencer platform MEET48 (2.8 million).
Over the months to come, we expect many more contenders for the top spot. More developers are looking into utilizing AI to enhance their user experience. DappRadar will also embrace AI to enhance user experience, improve exploration and supercharge discovery of decentralized applications across all 80 chains listed on the World’s Dapp Store.
Security incidents up 463% month-over-month
In Q4 2024, the Web3 sector recorded over $132 million in losses, caused by exploits and hacks. In January 2025 alone, we almost reached half of that. Month-over-month the blockchain industry has seen a 463% surge in security incidents, as recorded by REKT Database. A total of more than $62 million was lost.
This amount of money lost through exploits is a significant 50% increase from the numbers from January 2024, when $41 million was lost. Last month, a couple of major incidents stood out:
- BNB Chain Fortune Wheel – A hacker exploited the smart contract, gaining access due to a lack of access control and they drained almost $21 million.
- THORchain – the THORchain network may very collapse, as the ecosystem now has $200 million in frozen funds due to leveraged experimentation. Will they get it back? The next three months will be crucial for the existence of this network.
- Phemex – Centralized exchange Phemex lost control over its hot wallets, losing $30 million in the process.
The continued presence of hackers and scammers remains a warning for all who are active in the blockchain space. Securing your wallets, moving money to a new wallet, keeping keys safe, and never clicking links in newsletters and social media posts can save everybody a lot of drama.
Closing words
As we reflect on the first month of 2025, the dapp industry presents a landscape ripe with both challenges and opportunities. The dip in crypto prices has undeniably influenced NFT trading volumes and the Total Value Locked in DeFi, yet user engagement remains robust. Individuals continue to leverage blockchain technology for token swaps, NFT trading, gaming, social interactions, and a myriad of decentralized applications.
While the month-to-month statistics might suggest a downturn, we view this as a strategic moment to recalibrate and propel forward. This downturn could very well serve as a springboard for greater adoption and innovation in blockchain technology and decentralized applications. Here’s to building towards new heights in Web3.
