Regulatory heat on the crypto industry intensified in the previous quarter.
Facing the brunt are several sectors, including the DeFi and NFT, that demonstrated a troubling state. The blockchain gaming sector, on the other hand, appears to have remained unshaken in the face of the turmoil.
Gaming Dominates the dApp Market
According to a DappRadar report, the gaming category continues to lead as the most dominant, commanding 37% in the whole decentralized applications (dApp) market. The figure is still down from a 45% market dominance in the previous quarter.
Data also revealed an uptick of nearly 8% in daily Unique Active Wallets (dUAW) engaging with dapps on-chain from Q1, which may be interpreted as an encouraging sign of market recovery.
DappRadar noted,
“Despite the regulatory turbulence that pervaded the landscape, the digital asset market still thrived, as reflected by the growth of active engagement.”
DeFi’s Resurgence and TVL Plunge
A mild resurgence came in the form of meme coin hype and the L2 airdrops hunters, as DeFi’s dominance soared from 23% to 32%. However, DeFi protocols witnessed their TVL plummet by more than 7% from the previous quarter reaching $77.6 billion.
The report outlined that the downturn was unexpected and contrasts starkly with the anticipated growth trajectory of the DeFi landscape.
Challenges for BNB and Polygon
While Ethereum continued to remain in the lead with a marginal 2% decline from the previous quarter, the same cannot be said for the other two leading blockchains – BNB and Polygon.
Following the SEC lawsuit in early June, BNB suffered a 19% drop in its TVL, marking the most severe contraction amongst all considered blockchains. Polygon also witnessed an 8% TVL reduction as a direct impact of the regulator’s attack.
NFT Market Volatility
The NFT market was worst hit as its trading volume fell by 38% to land at $2.9 billion in Q2. However, the dip doesn’t necessarily indicate a waning of market interest or activity, the report specified.
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