March 2024 Public Chain Industry Research Report: Bitcoin Hits New Highs, Meme Craze Surges, AI Sector Emerges

Author: stella@footprint.network

Data Source: Footprint Analytics Public Chain Research Page

In March, the cryptocurrency market performed strongly, with Bitcoin reaching a new all-time high. Ethereum's price steadily climbed, while the Cancun upgrade significantly reduced transaction costs. The Meme craze on the Solana chain swept through, igniting market enthusiasm with its powerful wealth creation effect, and its influence also extended to other public chains like Base.

In driving the mass adoption of blockchain, AI, Meme, and TON have recently emerged as major forces. At the same time, public chains are tirelessly expanding the Web3 gaming ecosystem, which is increasingly recognized by the market as a key driver for blockchain mass adoption.

The data for this report comes from Footprint Analytics' Public Chain Research Page. This page provides an easy-to-use dashboard containing the most critical statistics and metrics in the public chain space, updated in real-time.

Cryptocurrency Market Overview

The cryptocurrency market in March showed strong performance, primarily driven by market expectations of declining interest rates, despite robust overall economic performance. This outlook heightened inflation concerns, making assets like Bitcoin and gold more attractive.

The AI industry became the market focus, with Nvidia unveiling the Blackwell GPU and GB200 super chip at the AI event GTC 2024, which not only ignited enthusiasm in the US and global stock markets but also sparked widespread attention in the cryptocurrency market, driving up the crypto AI sector.

At the end of March, Sam Bankman-Fried (SBF) was sentenced to 25 years in federal prison for fraud related to the collapse of the FTX exchange and Alameda Research in November 2022. While the story of SBF and FTX may be coming to a close, the crypto space still faces severe regulatory challenges. Notably, at the end of the month, news emerged that KuCoin is facing legal action from the U.S. Department of Justice and other agencies. Consequently, KuCoin is experiencing significant capital outflows.

Public Chain Overview

As March came to a close, the total market capitalization of public chain cryptocurrencies rose to $2.2 trillion, a 15.8% increase compared to February. In this wave of growth, Bitcoin, Ethereum, BNB Chain, and Solana stood out, with market shares of 63.2%, 19.7%, 4.2%, and 4.1%, respectively.

Data Source: Public Chain Token Market Cap Share - Footprint Analytics

Bitcoin experienced significant fluctuations between "breakthrough" and "volatility." It started the month at $61,213, quickly breaking through the previous high of $69,000, and reached an all-time high of $73,068 on March 14. Although it temporarily fell 15.1% to $62,047 in the middle of the month, it regained ground by the end of the month, closing at $69,656.

The price movements of Bitcoin are closely related to the performance of the U.S. Bitcoin spot ETF. The mid-month price drop was primarily influenced by a slowdown in inflows into the Bitcoin spot ETF and traditional traders reducing leverage. However, market anticipation for the Bitcoin halving event in April helped maintain its upward momentum.

Data Source: Bitcoin and Ethereum Prices - Footprint Analytics

In contrast, Ethereum's price increase was relatively steady, starting at $3,344 and closing at $3,648. Although Ethereum's gains were slightly less than Bitcoin's, it still maintained steady growth, partly due to the unclear prospects for the approval of the U.S. spot ETF. The Ethereum Cancun upgrade on March 13 aimed to reduce transaction costs, thereby promoting activity within its ecosystem.

BNB and Solana's token prices both saw significant increases, with gains of 48.8% and 56.0%, respectively, boosting their token market cap shares by about 1% during the month.

Data Source: Public Chain Token Prices and Market Cap - Footprint Analytics

In March, AI-related tokens saw significant growth. Sam Altman's return to the OpenAI board after a firing and re-hiring incident positively impacted AI-related tokens. Additionally, market anticipation for the Nvidia GTC conference further fueled speculative enthusiasm, benefiting projects announcing participation in the event. Notably, the token price and market cap of the NEAR chain soared by 84%.

The widespread adoption of AI applications has not only deepened public understanding of AI but also made the concept of "AI + crypto" more relatable and easier to accept. AI concept tokens are increasingly gaining attention, further driving the widespread adoption of cryptocurrencies.

Memes have also played an important role in driving mass adoption in the crypto world. Recently, Solana has gained significant attention due to a surge in Meme-related activities, with tokens like $BOME and $SLERF rapidly climbing in price, attracting active participation from a large number of community members. This phenomenon showcases the potential of memes to create wealth quickly and has sparked widespread FOMO in the market. As an easily accessible and understandable entry point, memes help lower barriers and attract more people to explore the Web3 space.

Memes

TON (The Open Network) and its closely associated social application Telegram have had a significant impact on driving mass adoption. In March, Telegram announced the expansion of its advertising platform to nearly a hundred new countries. This initiative, as a key component of Telegram's monetization strategy, allows public channel owners to earn up to 50% of advertising revenue, with all transactions conducted through TON. This greatly boosted on-chain activity for TON. In March, Toncoin's price and market cap both doubled, reaching an all-time high. With Telegram's vast user base and seamless integration of dApps, TON has simplified access to Web3. Combined with Telegram's strong marketing capabilities, the TON ecosystem is poised to become a key force in driving blockchain mass adoption.

TON Blockchain

By the end of March, the TVL of public chains reached $8.13 billion, with Ethereum, Tron, and BNB Chain ranking in the top three.

Data Source: Public Chain TVL Ranking - Footprint Analytics

Solana's TVL saw significant growth, reaching $3.59 billion, double that of February. This growth was primarily driven by the meme craze, which greatly increased online activity and attracted substantial capital inflows. DeFi dApps on Solana, such as the DEX aggregator Jupiter, received high attention and user participation.

Layer 2

With the booming cryptocurrency market and the support of the Cancun upgrade, Ethereum's Layer 2 on-chain activity and TVL reached new heights. Among them, Arbitrum One and Optimism performed particularly well, with TVL increasing by 26.4% and 7.2%, respectively, together accounting for about 70% of the market share.

Base's TVL grew by 87.3%, while active users (wallets) increased by 29.6%, primarily due to the appeal of meme coins like $DEGEN. Additionally, Coinbase's launch of a smart wallet further boosted the activity in its ecosystem. This smart wallet simplifies the user registration process through account abstraction (AA) technology, integrating with Touch ID or Google accounts, significantly enhancing Base's user acquisition capabilities.

Data Source: Ethereum Layer 2 Overview - Footprint Analytics

After Ethereum completed the Cancun upgrade, the average transaction fees on its Layer 2 networks saw a significant decline. Among them, Arbitrum and Starknet saw transaction costs reduced by over 95%. This substantial reduction in fees marks the official entry of the Ethereum ecosystem into the "penny era."

Data Source: Arbitrum Daily Transaction Volume and Average Transaction Fees - Footprint Analytics

Discussions about Layer 3 are becoming increasingly heated, with various stakeholders expressing their views. Marc Boiron, CEO of Polygon Labs, recently questioned the necessity of Layer 3 and explained why Polygon decided not to develop it. Meanwhile, Ethereum co-founder Vitalik Buterin also shared his perspective, noting that Layer 3 networks are not primarily intended for scaling; rather, their main purpose is to provide "customized features" for Layer 2 to enhance its performance.

Blockchain Gaming

In March, the player rankings showed that Ronin, Polygon, and BNB chains were the platforms with the most active players, accounting for 35.4%, 20.9%, and 10.8% of the market share, respectively. Notably, Ronin and Polygon further solidified their leading positions, with market shares increasing by 6.3% and 7.8% compared to February.

Data Source: Public Chain Active Gamer Share - Footprint Analytics

In terms of trading volume, Ethereum, Ronin, and BNB chains dominated. In March, Ronin's trading volume reached $81.7 million, a 35.1% increase month-over-month, while BNB Chain saw a 13% decline. Despite having fewer than 10 games, Ronin's market share expansion momentum is strong. As Ronin continues to add new games, its growth potential is expected to further increase.

Competition in the public chain space is intensifying, with major public chains increasing investments to promote the prosperity of the Web3 gaming ecosystem.

The Arbitrum Foundation announced a proposal to distribute 200 million $ARB tokens over two years to support gaming projects on its blockchain. Of this, 160 million $ARB will be allocated to game publishers and developers, while the remaining funds are planned for infrastructure improvements. This proposal requires approval from the Arbitrum DAO.

Meanwhile, the Starknet Foundation is also taking active steps by establishing a dedicated gaming committee aimed at promoting the development of the Starknet gaming ecosystem. This committee plans to distribute 50 million $STRK tokens to support gaming projects recognized by the committee, particularly those that can incentivize game development and player participation.

You can read the monthly blockchain gaming report from Footprint Analytics for more insights into the gaming industry: "March 2024 Web3 Gaming Report: Market Trends and Investment Dynamics."

Public Chain Financing Situation

In March, the public chain sector experienced significant growth, with 23 financing events totaling $380 million, a 160.2% increase compared to February. In this wave of investment, Optimism, Berachain, and Eclipse stood out, receiving substantial funding of $89 million, $69 million, and $50 million, respectively.

March 2024 Public Chain Financing Events (Data Source: crypto-fundraising.info)

Among these 23 financing events, the funding distribution showed a "tripod" pattern: 8 events involved Layer 1, 7 focused on Bitcoin Layer 2, and the remaining 8 primarily targeted Ethereum Layer 2. Although the highest disclosed investment amount for Bitcoin Layer 2 was only $10 million, the Bitcoin ecosystem is gaining increasing attention.

Token sales are gradually becoming a popular avenue for obtaining investment and financing.

Recently, Berachain successfully completed financing through a token sale, achieving a valuation of $1.5 billion and entering the unicorn ranks. This Cosmos-based platform, compatible with EVM, focuses on DeFi trading and plans to launch its mainnet in the second quarter of 2024.

The Optimism Foundation also announced a private token sale event, selling approximately 19.5 million OP tokens. This sale came from an unallocated OP token pool, totaling nearly $89 million at current market value. These tokens were purchased by an undisclosed buyer and will be subject to a two-year lock-up period.

Key Developments

• With the meme coin craze, Solana's search volume on Google surged, reaching a peak value of 100.

• The Blast mainnet officially launched on March 1.

• The Bitcoin Layer 2 project BEVM announced its mainnet release plan.

• CyberConnect announced the launch of the Ethereum Layer 2 network Cyber.

• Mysten Labs demonstrated the feasibility of linear scaling on blockchain with the prototype "Pilotfish" on Sui.

• Google has supported the search for Bitcoin, Arbitrum, Avalanche, Optimism, Polygon, and Fantom on-chain wallet addresses.

• BNB Chain launched the "Rollup as a Service" (RaaS) solution.

This content is for industry research and communication purposes only and does not constitute any investment advice. The market carries risks, and investments should be made cautiously.