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Users of Web3 applications hit a new all-time high in the second quarter of this year despite a decline in the total of staked digital assets on decentralized finance (DeFi) platforms.

The number of daily unique active wallets (UAWs) on decentralized applications (dApps) reached approximately 10 million from April to June, representing a 40% increase from the previous quarter, according to a July 4 report from DappRadar.

Each tracked segment of the dApp industry, including DeFi, blockchain gaming, non-fungible tokens (NFTs), and decentralized social media (SocialFi), experienced “notable growth, contributing to an overall bullish trajectory,” the report said.

SocialFi platforms witnessed the most increase, growing by 66% since the previous quarter and averaging nearly 2 million daily UAWs. Meanwhile, the blockchain gaming segment continues to dominate the dApp industry, though its share slightly decreased by 2% from the last quarter.

The NFT sector, which takes the smallest share among the main dApp segments, had its best quarter since the first quarter of 2023, recording $4 billion in trading volume from 14.9 million sales.

NFT marketplace Blur, while still leading with 31% market dominance, experienced a 50% decrease from the previous quarter. Magic Eden has capitalized on the Bitcoin Ordinals trend, growing its dominance from 17% to 22%. Meanwhile, OpenSea, despite ranking third in trading volume and dominance, maintains a strong foothold, leading in NFT sales with a 12% market share.

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Decentralized exchanges Raydium and UniSwap saw the largest increases in daily users among the most used DeFi apps. This growth is primarily attributed to their use in memecoin transactions, the major trend in Q2, with most users actively trading these tokens.

DeFi TVL down

The rise in dApp users didn’t translate into increases across the board, with the DeFi sector posting a 4% decrease in its TVL from the previous quarter to $168 billion by the end of Q2.

Ethereum posted a TVL of about $120 billion in Q2, marking a 9% increase from the previous quarter to maintain its market dominance.

Among the top blockchains tracked by DappRadar, Avalanche witnessed the sharpest decline in TVL, decreasing by 33% to $1.32 billion. Meanwhile, Ethereum layer-2 Linea’s total staked digital assets grew by 420% to $1.14 billion.

Despite a string of challenges, including exploits and hacks, DappRadar noted that the Web3 industry’s momentum remains strong, driven by sustained enthusiasm and the potential for further advancements.

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