Question:

The Merge has come and gone — what will be the next story, trend, or outlier to dominate the ETH space?

Identify at least 3 developing trends or events that could have a large impact on Ethereum between now and the end of this year. Back up your assertions with data and visualizations.

What’s next?

As mentioned earlier, the Merge has come and gone and the effects of this event has been analyzed on the Ethereum space recently. Now its time to predict future events that can affected the ETH space.

Three main events that discussed on the crypto and technology articles are as below:

• NFT’s and their applications

  NFTs are non-fungible tokens. They are issued as a unique digital certificate of ownership for any type of digital asset. NFTs are part of the Ethereum blockchain, and as such, are tokens that have additional information stored in them. NFT can be purchased through various platforms, each of which has a different purchasing method. Recently, the trend of NFTs has been grown rapidly due to their application on computer games and Move to Earn apps.

• Trend on Layer2s

  "Ethereum Layer 2 solutions" are digital currency projects that are created to increase the scalability of the Ethereum project and increase the number of transactions that can be recorded in the network. The Ethereum network is the first network to provide smart contracts, and many decentralized applications are built on this blockchain. Due to the increment on Layer 2 application the ETH space has been affected by the application of Layer2 on Ethereum.

• Trend on DeFi programs because of merge of Metaverse

  Decentralized Finance, or DeFi, refers to a set of applications that can perform important financial matters such as receiving loans and financial transactions in a decentralized manner without the need for intermediaries. Centralized intermediaries can commit corruption or unintentional error.

  The world of technology is an unstoppable world; Although technology was moving slowly until several years ago, we have seen it speed up in the past few years. "Metaverse" was created from the creative combination of the two words "meta" meaning "beyond" and universe "universe" meaning "world". Metaverse has acted as a virtual network where users will be able to interact with each other and with other components of their surroundings. In other words, in the Metaverse world, people play roles online and virtually.

  The emerge of Metaverse has been enhanced the application of DeFi programs to handle the economy of metaverse.

Methodology

The data provided by Flipside has been used to handle this analysis.

• The NFT trend has been analyzed by investigation on introduced and added projects on NFT mints and secondary market in various time basis.
• The Layer2 investigation has been done by the use of Layer2 Label on Ethereum tables and the tables related to the Layer2s like Arbitrum, Avalanche and etc.
• The DeFi trend analysis has been executed by the application of Ethereum tables. Also, the introduced DeFi programs on Ethereum has been grouped by their launch time.

Findings:

• NFTs have various application by the increasing trend on computer games, move to earn and Metaverse introduction.

• The highest NFT projects minted on Ethereum happened on 2021 and from month point of view, the January of 2022 takes the lead.

• The count of listed NFTs on secondary market of Ethereum has been enlarged over years and the most remarkable grown occurred on sale volume of NFTs and as can be seen in the second half on 2022, the application of NFTs will increase too.

• The grown rate of NFTs, minters and purchasers have been displayed by the cumulative graphics. The slope of these charts has been increased highly since middle of 2021.

• Over 600 million USD have been paid as total paid fee on NFT secondary marketplace on January 2022 and this number reveals the growing trend on NFT application.

  Due to the application of NFTs on projects introduced earlier, the trend of NFTs on Ethereum space will be followed the fast growing pattern.

Part 1: Trends on NFTs

Part 2: Trends on Layer 2 Blockchains

Findings:

The Layer2 platforms has been to handle the transactions on ETH space.

• The application of Layer2s on Ethereum blockchain increased over years.
• From the last months of 2021 and the first months of 2022, the slope of Layer2 usage on ETH space increased.

Findings:

• The Synapse, Avalanche and Hop protocol are the most used Layer2 destinations on ETH space in 2022.

• The active wallets on the selected Layer2 platforms increased over time as can be seen.

• The lowest application of Layer2s was at their lowest level on June 11 to 18 and after that date the trend of Layer2 destinations increased.

• In the past 2 months, the September 28 has the highest application of Polygon.

  Like said due to enlargement of application of new projects on Ethereum, the trend of using Layer2s grown very fast as reveled on graphs and expected to follow the increasing pattern in the next half of 2022.

Part 3: Trends on DeFi usage

Findings:

• The annual usage of DeFi programs in 2022 and at this date has promising numbers.
• The use of DeFi has grown significantly specially after the August of 2021.
• The July of 2021 has the highest application of DeFi programs.

Findings:

• DeFi programs are one of the key parts of Metaverse because of their application and special features.

• Mev, Convex and Gnosis safe are the most used DeFi programs on Ethereum in 2022.

• The May 9 was the leading date on the usage of DeFi programs for all projects.

• Largest group of Dei programs on Ethereum have been introduced on 2020 with 71 new projects. The summer of 2020 was the first “DeFi summer”.

  Without blockchain technology, the concept of Metaverse would be incomplete. In the rest of the 2022 we heard a lot and the application of DeFi programs could be follow the promising move in the second half of 2022.

References and useful links:

Author:

Credited by MZG

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