State of Crypto 2024: Builder Energy, U.S. Election, Stablecoins, AI, More
Oct 18, 2024
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Daren Matsuoka, lead data scientist, and Eddy Lazzarin, CTO, share insights from the State of Crypto Report 2024. They delve into crypto user estimations and the intriguing gap between global ownership and active participants. With the U.S. election approaching, they discuss rising interest in crypto in swing states. The duo also covers advancements in stablecoins and decentralized infrastructure, highlighting the impact of blockchain technology on everyday transactions. Expect a fresh look at the dynamic relationship between crypto, politics, and emerging technologies.
The 2024 State of Crypto report reveals a historic increase in active crypto addresses, reaching 220 million users worldwide.
Methodological advancements in estimating real crypto users suggest there are approximately 30 to 60 million active monthly transacting users.
Stablecoins are regaining traction as practical payment methods due to significantly reduced transaction fees and improved blockchain infrastructure.
Deep dives
Overview of the State of Crypto Report
The discussion emphasizes the importance of the annual State of Crypto report as a comprehensive analysis of the crypto industry's progress. By taking a step back, the report consolidates data and insights to paint an accurate picture of developments over the past year. It addresses not just metrics but also the challenges and potential misinterpretations that arise from complex crypto-related terminologies. The report aims to present information in an accessible manner, making it easier for a broader audience to engage with the subject matter.
Market Size and User Activity
The report highlights a significant increase in the market size of the crypto industry, reporting a rise in active addresses and mobile wallet users to unprecedented levels. In 2024, active addresses soared to 220 million, signaling a turning point for crypto infrastructure and application use. This surge is attributed to enhanced blockchain accessibility and lower transaction fees, allowing for real-world applications to emerge. The combination of these factors indicates that the industry is beginning to realize its potential, moving past the infrastructure-centric phase into user engagement.
Measuring Active Users in Crypto
Efforts to gauge the actual number of users behind the burgeoning active addresses reveal complexities due to the pseudonymous nature of cryptocurrencies. The report discusses the implementation of filtering techniques to eliminate bot and Sybil activity, estimating that there are approximately 30 to 60 million real monthly transacting users. This estimation highlights an opportunity for growth in converting existing crypto holders into active users. The methodology reflects a commitment to achieving transparency and reliability in metrics that represent user activity in the crypto space.
Emerging Trends and Builder Energy
The report introduces Builder Energy as an essential focus, showcasing the interests and activities of developers in the crypto ecosystem. The findings indicate that builders are increasingly gravitating towards blockchains like Solana and Base, reflecting a converging interest in affordable platforms for development. A dashboard has been introduced to visualize and share insights about these trends, underscoring the shift from traditional metrics to more nuanced perspectives regarding where builders are putting their efforts. The data highlights that Ethereum and its layer twos continue to dominate the builder mindset, indicating a robust future for these technologies.
Stabilization of Stablecoins and Payments
Stablecoins, previously regarded skeptically, have regained relevance as transaction fees have plummeted, fostering renewed discussions about their use for everyday payments. The report cites that the cost to send stablecoins on various networks has drastically decreased, making it viable for practical financial transactions and increasing their adoption. This shift has reinvigorated interest in stablecoins as a medium of exchange, contrary to the previous belief that such use cases were no longer feasible. The infrastructure improvements in 2024 have showcased stablecoins' potential to disrupt traditional payment systems effectively.
Welcome to web3 with a16z. Today we're taking you behind the scenes of our newly released, annual State of Crypto Report — a16z crypto's analysis of the latest data and trends that have defined the industry in 2024.
This year's report features some brand new insights, from estimating the number of real crypto users globally, to understanding how much interest in crypto swing states may have ahead of the U.S. election. We also dig into infrastructure improvements to blockchains and key applications — including stablecoins, AI, and so-called DePIN. Be sure to visit a16zcrypto.com for all this and more including a new “Builder Energy” dashboard, which we’ll discuss on the show.
Joining me to talk about the findings are lead data scientist and report author Daren Matsuoka and CTO Eddy Lazzarin. The first voice you'll hear after mine is Daren's, then Eddy's.
As always, none of the content should be taken as tax, business, legal or investment advice. See a16z.com/disclosures for more important information, including a link to a list of our investments.
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