Blockchain analytics platform Nansen released its 2021 State of the Crypto Industry Report, highlighting key growth trends across decentralized finance (DeFi), non-fungible tokens (NFTs), blockchain gaming, and the emergence of Layer 1 and Layer 2 solutions.
Introduction
2021 was a landmark year for cryptocurrency adoption and price action. While DeFi gained traction post-2020, NFTs captured mainstream attention, and play-to-earn games like Axie Infinity demonstrated strong product-market fit. Below, we explore the year’s defining trends.
The Multi-Chain Ecosystem
Ethereum maintained dominance, but high gas fees drove users to alternatives like Binance Smart Chain (BSC) and Polygon. Key insights:
- Transaction Volume: BSC and Polygon peaked at 1,345% and 760% of Ethereum’s daily transactions, respectively.
- Active Addresses: BSC emerged as the most active Layer 1 by daily addresses.
- TVL Leadership: Ethereum held ~70% of total DeFi TVL, despite competition.
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DeFi’s Unstoppable Growth
DeFi’s total value locked (TVL) surged by 1,120% in 2021, with notable developments:
- Top Protocols: Uniswap and Aave activity cooled post-midyear, while Lido’s staked ETH grew 93x.
- Smart Money Moves: SHIB surprisingly ranked #9 among top-traded pairs, with one wallet yielding a 7,500x return.
- Stablecoin Shift: USDC’s market cap grew 8.3x, narrowing USDT’s lead.
NFTs: From Art to Cultural Phenomenon
NFTs exploded with $17B total sales volume in 2021:
- Blue-Chip Projects: CryptoPunks and Bored Ape Yacht Club became status symbols.
- Trading Profits: Top 10 NFT traders earned 46,221 ETH (~$185M collectively).
- Market Peaks: August 29 saw 132K ETH ($422M) in daily sales.
Play-to-Earn: Redefining Gaming
Blockchain gaming introduced asset ownership and monetization:
- Axie Infinity: Generated $1.3B revenue, with 1.1M daily active addresses on Ronin.
- Value Flow: Contrasted traditional games’ closed economies with player-driven NFT monetization.
Conclusion & Future Outlook
2021’s trends—DeFi, NFTs, and multi-chain scalability—are expected to evolve in 2022. Decentralized stablecoins (e.g., UST) and institutional adoption may gain prominence as regulatory frameworks develop.
FAQ Section
Q: Which chain had the highest TVL in 2021?
A: Ethereum led with ~70% of DeFi’s total value locked.
Q: What drove NFT market peaks?
A: High-profile endorsements and collection hype, notably in May and August.
Q: How did Axie Infinity achieve $1.3B revenue?
A: Its Ronin blockchain reduced fees, boosting user engagement.
Q: Why did USDC grow faster than USDT?
A: USDC’s transparency attracted users amid USDT’s regulatory scrutiny.
Q: What’s next for multi-chain ecosystems?
A: Layer 2 solutions will likely prioritize scalability and lower costs.