This Week's Headlines:
DApp Volume Highs, But New Deployment Trends Downwards
Ether transacted in April on Decentralized Application (DApps) pipped out December's All-Time-High by a tiny margin. The new high, in both Ether and US Dollar value, sets a 4-month growth trend in on-chain volume. At the same time, however, the number of newly deployed DApps have mirrored the exact opposite direction hitting a 15-month low.
776k Ether was transacted on DApps last month turning on-chain activity higher than the previous period for 4-months in a row. This year is the most prolonged period of growth in terms of transacted volumes DApps have witnessed, ever.
Nearly $132Mn was transacted on DApps, mainly Decentralized Exchanges (DEX) and gambling applications, also marking a 4-month in a row growth and an 8-month high. Versus March, this was a 46% increase and a whopping 186% in comparison to volumes seen at the start of the year when they hit an all-time low (Diar, 28 January).
|| NOT ALL ROSY
New DApps going on-chain, however, is marking the lowest point nearing 2017 levels (see chart). Ethereum remains the platform of choice seeing almost 60% of all newly deployed applications run on the 'supercomputer' this year according to statistics from State of Dapps that tracks over 2600 projects.
April closed off the month with a mere 88 Decentralized Application (DApps) being deployed hitting levels not seen since the start of 2018. Last month wraps up a continuous declining trend in deployment since September 2018, bar a flurry of new DApps that went on-chain at the end of last year which marked the peak of development to date.
|| LURKING GROWTH?
Developer interest though has hardly waned. The Truffle Framework which has become a core tool for programmers to build on top of Ethereum has seen downloads hit an all-time high this year with a sustained quarter-on-quarter growth (see chart).
The likelihood however that developers are focusing on token-based projects might be slim despite the attention given to coins due to monetary value sparking speculator gains - and losses (see story below)
|| WHERE TO FROM HERE?
Developers will likely continue hitting roadblocks with infrastructure still far from scale and a user experience effectively in their first iteration on Ethereum. And with new blockchains coming online, developers may begin to split their focus.
Decentralized Organizations platform Aragon, who have been staunch Ethereum supporters, saw their community vote against the exclusive focus on the largest smart-contract platform allowing for the venture into Polkadot. Other are likely to follow.
Bitcoin Blocks Fill to the Brim, SegWit Keeps Fees at Bay
Average Bitcoin transactions fees shot up a near 200% in April versus March as the blocks reached well above the 1Mb limit hitting a new high. SegWit though has also reached a usage high keeping fees suppressed.
Bitcoin miners earned themselves a cool $291Mn in April, nearly 30% higher than March as the price of the cryptocurrency continued on its ascent (see chart 1). But the reward isn't the only earner with fees also rising by 250% last month versus March raking in nearly $14Mn (see chart 2).
On-chain volume still heavily used for ramping on and off exchanges has been the main culprit as traders look for an opportunity with the price of Bitcoin rising 43% during April resulting in full blocks (see chart 3). But SegWit, the scalability solution that addresses the issue has also hit a high with the percentage of blocks using the mechanism averaging 35% alleviating fee pressures. 2018 average SegWit usage was only 26% and only 11% at Bitcoin's peak highlighting the continued adoption by major players.
The number of transactions on-chain is also just shy of the all-time-high of December 2017. Since hitting a low in February of last year, month-on-month growth for the number of transactions has been clearly evident (see chart).
Real volumes though remain off the mark, though, have shifted back into growth (Diar, 30 April).
|| ESTIMATING APPLES FOR APPLES
Currently, 1-2 block confirmation times are 84% lower than seen at peak, though, Bitcoins moved on-chain is still 1/3 of peak (see chart 6).
Diar estimates that at current SegWit usage levels, fees could go up as high as 300% should on-chain movement of Bitcoins resemble that seen in at the end of 2017.
Still, fees would be more than 55% cheaper than that seen in December 2018 when fees hit nearly 500 Sat/byte indicating the technology behind SegWit is working as intended with it being put thoroughly to the test.
1: April Bitcoin Miners Revenues Near $300Mn...
2:...With Miners Earning Nearly $14Mn From Fees Alone
3: And While Blocks Are Becoming Full, SegWit % Rises...
4:...Keeping Fees 84% Lower Than All-Time-High (Sat/Byte)....
5:...As April 2019 On-Chain Transactions Nears Record # of Txs
6:...And Real Bitcoin Volume also Trending Upwards
Sources: Diar Calc., Blockchair, Blockchain, P2SH, TokenAnalyst
Kraken Opportunity as Bitfinex, Tether Convolute Prices
Tether, the contentious stablecoin whose reserves have been slashed by 26% has come back from the dead once again just shy of its intended Dollar peg at press time. Arbitrage opportunities reached as high as 5% for traders willing to jump a few hoops entering and exiting their Tether positions on Kraken, one of the only exchanges to have a USDT/USD pair.
SIX Swiss Exchange Eyes Digital Arm Extention
SIX, Switzerland's principal stock exchange is set to open up a new trading arm primarily focused on the tokenized of traditional assets from stocks to structured products.
|| NO REALLY...IDO....
Thomas Zeeb, Head of Securities and Exchanges at SIX tells Finews that "ultimately we want to be able to tokenize existing securities – equities, fixed income, funds. Maybe the token will eventually replace the share one day" with the anticipated launch of Initial Digital Offerings (IDO) by 2021. Mr Zeeb said the exchange may very well conduct its own IDO.
While the need for a blockchain is pointless without other exchanges participating in the network, it's easy to see why SIX is venturing into tokens. Any resemblance of the current global trading ability cryptocurrencies offer is a certain win for exchanges.
And as one of the first in Europe to offer exchange-listed cryptocurrency products, SIX continues driving the Blockchain bandwagon after having found it's Bitcoin, Ether and Top Cap Basket Exchange Traded Products (ETP) by Amun trade as their top performers only to be surpassed by crude oil.
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