Polygon Nearly Matches Ethereum in User Acquisition in 2023: Flipside Report
Summary:
In 2023, Polygon, the Ethereum scaling solution, accrued nearly as many new users as Ethereum, according to a report by blockchain analytics company Flipside. The firm identified a new user as someone who made at least two transactions on a specific blockchain in 2023. Polygon began the year strongly, but by the second half, Ethereum regained and maintained its leadership position. Other major players in user acquisition included Bitcoin, Solana, and Arbitrum. The report also noted a rise in user acquisition—peaking in May—following Silicon Valley Bank's collapse in March, suggesting a shift toward decentralized custody alternatives. Despite slowing growth towards the end of the year, Flipside sees potential for user growth for Base, especially with Coinbase positioning itself as a gateway for new crypto users.
In a report by blockchain analytics company Flipside, it was revealed that in 2023, nearly as many cryptocurrency enthusiasts embraced the Layer-2 scaling network Polygon as they did Ethereum. Polygon, a mechanism known for improving Ethereum's scalability, accrued approximately 15.24 million new users in 2023, just 160,000 fewer than Ethereum's 15.4 million. Flipside's definition of a 'new' user is an individual who has conducted at least two transactions on a specific blockchain, with one transaction taking place in 2023. Interestingly, Polygon began leading the year strong but was eventually surpassed by Ethereum, who maintained its leadership through the latter half of 2023. It wasn’t only sentiment that changed, but user behaviors started to shift, affecting the crypto markets.
Polygon saw an extraordinary beginning to the year with its user base skyrocketing to 2.8MM in January — making up more than 40% of the network's total new users in 2023. Despite experiencing a regular monthly decline in user acquisition, Polygon still outperformed many other networks. Bitcoin secured third place with 10.65 million new users, followed by Solana and Arbitrum. Eight blockchain networks, including Optimism (OP), Avalanche (AVAX), and Base (BASE), had a total of 62 million new users. It's noteworthy that user acquisition peaked in May 2023 before slowly declining. The uptick in new users began in March, aligning with the fall of Silicon Valley Bank, possibly leading to a loss of faith in centralized systems and encouraging a shift to decentralized custody alternatives.
Flipside highlighted that Base had an impressive debut in August 2023, but its user volume dwindled toward the close of the year. Giants asserting dominance and boasting diverse app ecosystems were probably factors in Base's slowed growth. But, the analytics firm suggests that the anticipated bull run could boost Base's user growth, considering Coinbase is striving to be the preferred cryptocurrency entry point for new users.
Published At
1/26/2024 8:19:42 AM
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