There has been a noticeable increase in network activity within the broader Ethereum ecosystem. Based on Dune Analytics data, there are now over 10 million wallets actively using the mainnet and layer-2 solutions like Base, Optimism, and Arbitrum, excluding Ordinals-related addresses.
Ethereum Ecosystem Thriving: Over 10 Million Active Wallets
This achievement is a direct outcome of the successful implementation of the Dencun Upgrade in mid-March 2024. This upgrade, among various others planned for Ethereum, effectively tackled critical issues, especially concerning scalability and gas fees.
Driven by the rise in active wallets interacting with different protocols on the mainnet, sidechains, or off-chain rails, an analyst on X is optimistic, forecasting a growth from 10 million to 100 million in the next bull cycle. This surge will be partly fueled by the improvements introduced by Dencun, making layer-2 transactions using rollups more cost-effective.
To achieve this, Dencun utilizes “blobs,” a novel transaction type, to store data not processed by the Ethereum Virtual Machine (EVM). Blobs act as new data storage channels within a block, enhancing block verification efficiency. Notably, this is accomplished without compromising data accessibility—beneficial for layer-2 solutions integrating Dencun.
Total Value Locked (TVL) Soaring Across Layer-2 And DeFi Platforms
With declining gas fees and more effective layer-2 platforms, Dencun has attracted new users, revitalizing the broader Ethereum ecosystem. The increasing Total Value Locked (TVL) across layer-2 portals and the mainnet is evidence of this trend.
According to L2Beat, leading layer-2 platforms like Arbitrum and Optimism have experienced double-digit growth on average in the past week. Currently, all layer-2 platforms collectively manage over $39 billion in assets. Corresponding data from DefiLlama confirms this expansion. Over the last six months, the TVL of major decentralized finance (DeFi) protocols has surged from around $20 billion to over $54 billion as of now
Despite these positive developments, challenges persist. Ethereum is susceptible and may struggle to scale efficiently during periods of high usage. Therefore, it is probable that gas fees will increase in the next bull cycle, especially if ETH prices surge, surpassing $4,000 and reaching all-time highs.
Moreover, users, particularly creators of meme coins, might opt for alternatives like Solana or Avalanche, potentially reducing Ethereum activity.
Nevertheless, Ethereum enthusiasts remain optimistic. As cryptocurrency prices stabilize and potentially mirror the gains of Q1 2024, more users are likely to explore the leading protocols launched on the mainnet or through layer-2 platforms.
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