In brief
- Ethereum’s transaction volume skyrocketed to $119.5 billion in Q3 2020, says DappRadar’s report.
- This is nearly a 1,200% increase compared to Q2.
- Decentralized finance applications accounted for 99% of that volume—crushing Ethereum’s gaming sector.
Transaction volume on the Ethereum blockchain reached $119.5 billion in Q3 2020, surging by nearly 1,200% compared to the previous quarter, according to DappRadar’s industry report published today.
Per the report, Ethereum’s transaction volume amounted to “only” $10.2 billion just a few months ago—in Q2 2020. Such a sharp increase became possible mostly thanks to the ongoing decentralized finance (DeFi) craze that keeps attracting yield farmers.
Among the 13 blockchains listed on DappRadar, Ethereum accounted for 96% of the total transaction volume, retaining its mantle of the biggest network by far. At the same time, the DeFi ecosystem was responsible for 99% of those figures.
“We spot that the DeFi ecosystem is not only the number one category but also holds 99% of the value within the Ethereum blockchain in Q3 2020,” DappRadar noted.
As Decrypt reported, the DeFi boom led to a major drawback as transaction fees keep growing rapidly. Over the past couple of months, Ethereum miners have been regularly setting new records in terms of their profits, successively earning $500,000, $800,000, even $1 million per hour in transaction fees alone. In September, miners even earned more from transaction fees than from block rewards—for the first time in Ethereum’s history.
Ethereum fees crush gaming sector
But that doesn’t seem to bother the DeFi train. After all, people flock to yield farming to make more money on their funds, so high transaction fees are part of the spiel. But overblown fees began to choke other decentralized apps (dapps) besides DeFi, DappRadar noted.
“In Q2 2020 we witnessed a tremendous drop [in the Games category] and the trend has continued into Q3 2020. The reason behind it is still high Ethereum gas prices and looking at the prevailing trends of the DeFi ecosystem, it doesn’t look like that situation is going to change anytime soon,” said the report.
Apart from gaming, marketplaces, collectibles, gambling and other dapps are also struggling with high transaction fees, although some of them are slowly but surely joining the DeFi hype, DappRadar added.
So, not only is all of DeFi pretty much on Ethereum—but all of Ethereum is now DeFi too.