While bitcoin hit an all-time high in the first week of October, Q3 2025 serves as a perfect launchpad for the end of the year. The dapp industry has been hampered by struggling crypto markets, but innovation never stops. In the past 3 months we’ve seen the rise of dapps continue, tokenization becoming a major pillar of the industry, NFTs gaining momentum, and DeFi hitting an all-time high of total value locked.
Key Takeaways
- The dapp industry averaged with 18.7 million active wallets per day, down 22.4% from the previous quarter.
- Gaming solidified its market dominance, growing from 20.1% to 25% in the third quarter. NFTs (18.5%) and DeFi (17.9%) follow at a distance.
- DeFi reached a record high in Total Value Locked (TVL), recording a total of $237 billion across all blockchains and protocols.
- NFT trading volume almost doubled over the quarter, reaching $1.58 billion. While sales hit a quarterly record of 18.1 million NFTs.
- Sports turned out to be a major growth market for NFTs, increasing the category’s trading volume by 337% to $71.1 million.
- Financial damage of hacks at lowest point this year with $434 million in Q3 2025, but digital threats become more sophisticated.
Table of Contents
1. Dapp usage drops as SocialFi and AI lose momentum
2. DeFi reached a record high with $237 billion in TVL
3. NFT sales count reached highest number since 2022
4. Digital threats never end as $434 million got stolen
5. Closing words
1. Dapp usage drops as SocialFi and AI lose momentum
The dapp industry has seen a 22.4% drop in the number of daily unique active wallets. Throughout Q3 2025 the industry attracted an average of 18.7 million wallets per day. Looking at the entire quarter, every category noted a drop in active wallets, but the impact was mostly felt in the Social and AI categories.
The AI category lost some traction throughout the quarter, dropping the average number of active wallets from 4.8 million in Q2 2025 to 3.1 million in Q3 2025. This downtrend can be seen in the success of Virtuals Protocol, the launchpad for AI agents. Virtuals Protocol attracted 10,000 active wallets per day in Q2 2025, while millions moved into the platform. Nowadays it attracts 1,000 up to 1,500 active wallets, responsible for around $100,000 on average per day.
Alongside AI, the Social category has taken a hit as well. In the second quarter of the year, social dapps attracted 3.8 million active wallets per day. In Q3 2025 that number more than halved to 1.57 million active wallets. Various social dapps, such as The Arena, Layer3, and OnchainGM, peaked in the second quarter, while seeing a significant decrease in activity in the past 3 months.
When breaking down the dapp industry by market sector, we see that both Social and AI have lost market share in the past quarter. In the second quarter AI was the third most active market segment with a 18.6% dominance, which dropped to 16.8% in the third quarter. Social was even hit harder, dropping from 15.9% to 8.4%. What stands out in terms of market dominance, is that NFTs gained market share and now sits in second place with 18.5%. At the same time, the Games category remains leader in the dapp industry with 25% market dominance.
However, we need to place a side note here. Many dapps with the gaming label utilize user engagement tactics to increase their onchain activity. Think about for example daily logins or spin-the-wheel reward programs alongside the actual gameplay.
Earlier this year, Games, DeFi and AI reigned, while Social and NFTs were right behind. In Q3 2025 the tables have turned. Games are still on top, but NFTs climbed the charts and are now in second place. DeFi follows with AI right behind, while Social is now the weakest market sector, outpaced by a wide range of varied dapps in the Other category.
Do we look at individual dapps, then we see the dominance of gaming dapps. While shopping app KAI-CHING attracts the most active wallets, gaming is a big part of the Top 5 dapps. World of Dypians is a social gaming metaverse, HOT Protocol offers gamified services, while KGeN is a gaming engagement platform.
Gaming as a Web3 sector is struggling to attract a mainstream audience. Axie Infinity penetrated the mainstream during the COVID pandemic. However, since then the number of success stories have been limited. Gaming dapps often aren’t just games, but involve gamified engagement mechanics. We will move deeper into the market trends in the gaming industry in our upcoming games report in collaboration with the Blockchain Game Alliance.
2. DeFi reached a record high with $237 billion in TVL
Alongside the value increase in crypto prices, innovation is pushing the DeFi market to record heights. Lending protocols are thriving, cross-chain liquidity has become a major topic in the industry, while the rise of memecoins and AI tokens brought lots of liquidity to certain ecosystems. Moreover, the rise of stablecoins is really pushing DeFi into the spotlight of traditional finance.
During Q3 2025, the United States passed three crypto legislations, and the GENIUS Act stands out. It provides the first legal framework for payment stablecoins, requiring issuers to hold cash reserves or short-term US bonds. At the same time, corporations and investment funds invest billions in bitcoin through Bitcoin ETFs. The launch of Plasma as a chain for stablecoins, alongside announcements of networks by Circle, PayPal and others, emphasizes the demand from traditional financial institutions in this crypto-version of the dollar, euro, won, yuan or yen.
It’s here, in this perfect storm, that the DeFi sector recorded a new record in total value locked. Q3 2025 ended with $237 billion locked in DeFi smart contracts. That’s the highest number we’ve ever recorded, and with the rise of the tokenization of real-world assets and ongoing developments surrounding stablecoins, this could be the start of a massive influx of liquidity.
However, while Ethereum has always been the frontrunner for the DeFi sector, it did not steal the show in Q3 2025. Despite still being the leading chain with its $119 billion in TVL, Ethereum saw its TVL drop 4%.
Solana managed to maintain its number two position, but recorded the biggest loss of all the chains in the Top 10. Solana saw its TVL drop by 33% to $13.8 billion, driven by the loss of momentum surrounding Pump.fun and memecoins.
Much more positive is the situation of the other 8 entries in the list. BNB Chain is making waves with the launch of Aster, a perpetual DEX. Hyperliquid, built for onchain perpetual trading, has been making waves throughout the year, and managed to increase its TVL by 29% to $2.85 billion. It’s a theme we’ve seen during the quarter, where decentralized exchanges are slowly becoming as feature-rich as centralized exchanges.
3. NFT sales count reached highest number since 2022
Trading volume is a bit on the low side, as many NFTs trade for lower values nowadays. However, the number of trades increased in 2025. In the first quarter of the year we recorded 7 million NFT sold, followed by 12.5 million in the second quarter. The upwards trend continues. In Q3 2025, the market recorded over 18.1 million NFTs sold, generating $1.6 billion in trading volume.
This upward trend we’ve seen in 2025 in terms of sales count, is not reflected in actual adoption. Sure, the number of NFT traders reached its highest monthly number in 12 months, but the growth is minimal when compared with the sales count.
In Q1 2025, we’ve seen 1.66 million wallets trading NFTs. During that same period (see above) we recorded 7 million NFTs sold, suggesting an average of 4.2 NFTs per wallet. Fast forward to Q3 2025, we’ve seen 2.14 million wallets trading 18.1 million NFT assets. That’s an average of 8.4 NFTs per wallet.
Between the two quarters sales increased a stunning 158%. However, the number of wallets increased only 28.6%. This suggests conviction from established participants, and not an influx of new users.
The only NFT category that’s seeing a decline is gaming. Over the past quarter gaming lost 17% in trading volume, while the number of sold items dropped a shocking 32%. How different is it in the sports category, where trading volume increased 337% to $71 million, while sales count increased by 143% to 4.1 million.
One of the leading dapps in this sports field is Sorare, which offers fantasy sports experiences for basketball, baseball and football. This platform is responsible for multimillions in trading volume, selling hundreds of thousands of digital cards to players and collectors around the globe. These numbers were driven by the kick off of the new sports seasons.
Marketplace airdrops and older projects reviving
The influx in trading volume can also be credited to a couple of developments. For example, OpenSea launched a campaign for their upcoming token, while rewarding the most active traders on their platform. This now makes users trade low value NFTs to meet their daily criteria. No wonder OpenSea managed to increase their sales count by 29% to 9.27 million assets sold.
At the same time we’ve seen PFPs gain traction, led by CryptoPunks, Moonbirds, BAYC and Pudgy Penguins. Quarter over quarter the trading volume for PFPs grew 187% to $544 million. While CryptoPunks remains the holy grail for NFT collectors, Pudgy Penguins is slowly developing into a Web3-infused entertainment brand, spanning games and other forms of entertainment.
Throughout Q3 2025 Yuga Labs, the company behind Bored Ape Yacht Club, sold some of its assets to focus solely on BAYC, MAYC and Otherside. This brought some new excitement to the Bored Ape community. However, they sold Moonbirds.
With 8,311 sold NFTs and $88 million in trading volume, Moonbirds has been the biggest comeback story of the quarter. The Moonbirds IP is now owned by Orange Cap Games, and in the first week of October the team announced plans to bring the $BIRB token to Solana.
NFTs evolving into DeFi protocols and tokenized assets
Aside from the numbers, the real revolution is happening in the shadows. NFTs are now much more than just a JPEG of a monkey as they merge with the emerging trend of RWAs, or real-world assets, and with DeFi. Let’s first talk about tokenization.
The leading NFT collection is Courtyard, which tokenizes physical collectible cards and then sells them as NFTs on the blockchain. Each NFT on Courtyard is a tokenized physical trading card, for example from Pokémon or baseball cards. Users can trade the digital representations of physical collectibles, or redeem them to receive the physical copy of their card. In Q3 2025 alone, Courtyard did more than $145 million in trading volume from 1.55 million sold items.
In September a new trend emerged; NFT Strategy. Token Works launched the concept of an automated protocol called PunkStrategy, used to buy and sell CryptoPunks assets. Users acquire $PNKSTR tokens and 10% of the trading fees goes into a pool. Once the protocol has gathered enough money, it purchases the cheapest CryptoPunk, and then lists at 20% above the purchased price.
When the punk has been sold on the open market, the protocol uses the acquired $ETH to buy $PNKSTR from the market. Those tokens then get burned, and taken out of circulation. As a result, $PNKSTR becomes a way to get exposure to CryptoPunks without buying these expensive NFTs.
Safe to say, NFTs are no longer only about collecting. The digital asset can represent ownership over physical assets, or can be part of automated DeFi protocols. The way we use NFTs in the blockchain space is evolving, and we’re excited about the future of this unique type of asset.
4. Digital threats never end as $434 million got stolen
During Q3 2025 hackers managed to steal over $434 million worth of crypto. The biggest attacks involved social engineering and exploits. In July a hacker exploited a malicious contract from GMX V1 to manipulate internal accounting safety measures, allowing the hacker to withdraw more funds then they should have been able to. The result was a $42 million loss. A few days later CoinDCX was exploited for $44 million due to a server breach.
Most recently, in September social project UXLINK suffered a multi-signature exploit, resulting in $21.7 million in stolen assets. In addition, the hacker gained unauthorized minting rights, and they issued 1 billion $UXLINK tokens. The sell off caused the token to lose 70% of its value. Ironically, the hacker later lost his $48 million worth of tokens through a phishing attack. Karma.
The second biggest incident from Q3 2025 was the hack of the Turkish exchange BTCTurk. However, the number one spot goes to a single victim who lost 783 BTC ($91 million) through a social engineering scam. Threat actors managed to trick the victim by impersonating exchange and wallet customer support. Details are unknown, but such an attack seems much more likely with the rise of AI tools.
These 5 incidents make up the majority of the funds stolen during Q3 2025. With $434 million stolen, the quarter seemed less intense. However, with the rise of tokenization of real-world assets, more advanced DeFi features, and institutions looking to embrace stablecoins, it’s safe to assume that crypto wallets will always be a target for scammers and hackers. Recent reports about a zero-click exploit in the iOS operating system and zero-click vulnerabilities in WhatsApp suggest that crypto users need to stay vigilant.
5. Closing words
Q3 2025 has showcased the dapp industry’s resilience and adaptability amidst a dynamic crypto landscape. Despite a dip in daily active wallets and challenges in SocialFi and AI sectors, the industry is forging ahead with remarkable milestones. DeFi’s record-breaking $237 billion in Total Value Locked signals robust growth and increasing institutional interest, particularly in stablecoins and tokenized assets.
The NFT market’s surge to 18.1 million sales underscores its evolving role, transcending collectibles to integrate with DeFi and real-world assets. Gaming continues to dominate, but more about that in our next week’s report.
The dapp industry is slowly touching the lives of everyday users looking for financial services, a fun game to play, or a rare Pokémon card. For now we’re talking about millions of active wallets, but soon it will be billions.
