Written by: Sara Gherghelas, DappRadar
Translated by: Tim, PANews
Despite the rebound in cryptocurrency market prices and improved sentiment, the DApp ecosystem presents a different picture: AI agents have seen explosive growth, NFT values have shifted from ostentatious to functional, while DeFi continues to navigate between rising TVL and shrinking financing. These data not only showcase market activity but also reveal the real flow of users, the areas that are lagging, and the key trends reshaping the future of DApps.
In the era we are in, it is no longer possible to drive market conditions solely through speculation. Users are beginning to pursue real value: whether it's AI agents that can accomplish tasks, NFTs associated with RWAs, or DeFi platforms that provide sustainable returns. However, risks remain high: losses from exploit incidents have surged, indicating how fragile trust is, and that even minor oversights can be exploited by malicious actors.
This report delves deeply into the changes in industry landscape, providing a comprehensive analysis of data dynamics in DeFi, NFT, gaming, AI, and other sectors. From wallet activity, trading volume to application and capital flow, we track key signals and focus on observing the core narratives shaping the cryptocurrency industry in Q2 2025.
Key Points:
In Q2 2025, the average daily active independent wallets for DApps was 24.3 million, a decrease of 2.5% quarter-over-quarter, but still a staggering increase of 247% compared to early 2024.
Total locked value in DeFi reached $200 billion, a quarter-over-quarter growth of 28%, mainly benefiting from Ethereum's 36% rebound. However, the financing amount in the DeFi sector fell by 50% quarter-over-quarter, with only $483 million raised in Q2, making the total financing for the first two quarters of 2025 amount to $1.4 billion.
NFT trading volume plummeted by 45% to $867 million, yet the number of sales surged by 78% to 14.9 million, reflecting a sharp drop in the market's average price, while the number of traders grew by 20%.
RWA NFT trading volume increased by 29%, rising to second place in the sector, with the Courtyard platform becoming the second-largest NFT market by trading volume this quarter.
Guild of Guardians NFT trading volume soared to first and fourth places, surpassing BAYC and CryptoPunks, marking a turning point for gaming NFTs.
Web3 suffered losses of $6.3 billion from security incidents, an increase of 215% quarter-over-quarter. The single loss from the Mantra exploit alone reached $5.5 billion, making it the second largest security incident in the crypto industry since the FTX bankruptcy (loss of $8 billion).
1. The number of daily active independent wallets for DApps stabilized at 24.3 million, with significant growth in AI and social sectors.
This quarter, DApp activity decreased by 2.5%, with the average number of daily active independent wallets at 24.3 million. Nonetheless, we can still consider that the ecosystem has stabilized at this level, marking a sign of the industry's increasing maturity and proving that users are continuously interacting with DApps across multiple application domains. It is worth noting that many users operate multiple wallets, so the number of daily active independent wallets differs from the actual number of users. However, this metric remains a strong indicator of user participation. Just a few quarters ago, the number of daily active independent wallets was still around 5 million, showing a significant growth rate.
The number of active wallets in both DeFi and GameFi has declined, with DeFi down 33% and GameFi down 17%. On the other hand, Social and AI DApps have experienced growth, aligning with broader industry trends.
In the Social sector, the rise of InfoFi is notable, with platforms like Kaito and Cookie DAO leading the way. In the AI sector, agent-based DApps are showing strong momentum, with Virtuals Protocol standing out.
As expected, these sector-level shifts have also affected the distribution of dominance. The decline in activity in the DeFi and Gaming sectors has led to a reduction in their market share, while AI and Social sectors have seized and expanded more share. Comparing Q2 2025 to Q1, it is evident that the rise of the AI sector is rapid, with the Social sector closely following. I believe that by the end of this year, if AI surpasses either Gaming or DeFi in dominance, it would not be surprising.
In fact, among the top-ranked DApps by independent wallets this quarter, an AI DApp ranked first.
The remaining positions on this list are occupied by many well-known projects, mainly from the DeFi space. Given that these projects have maintained long-term stable operations amid the Meme coin craze and Agent token frenzy, such a distribution is understandable.
Additionally, another perspective worth noting is that this quarter we introduced the "sleeping DApp" metric, specifically tracking those decentralized applications that were active in Q1 2025 but completely ceased activity in Q2.
We focused on analyzing several major categories: non-active decentralized applications in the DeFi sector increased by 2%, gaming applications grew by 9%, and NFT applications rose by 10%. This analysis particularly included high-risk applications, which saw a significant reduction in inactivity by 40%, indicating that they are still in use and rarely abandoned. However, the most surprising was the AI sector, where inactive AI applications surged by 129%. While this percentage seems astonishing, it actually corresponds to only 16 applications. Nevertheless, this phenomenon raises important considerations: it highlights that many of these projects (especially in gaming and AI) are still in their early stages of development, and without sufficient funding support, achieving mainstream application is incredibly challenging. In the Web3 space, user retention remains the most daunting challenge, and these data undoubtedly confirm this.
2. Total locked value in DeFi soared to $200 billion in Q2 2025, but financing plummeted by 50%.
This quarter's macroeconomic environment has been like a rollercoaster, and the DeFi sector has not been insulated from this turbulence. Nonetheless, the market still shows positive signs: first, the cryptocurrency market prices have rebounded strongly, with Bitcoin rising 30% compared to Q1 2025, Ethereum climbing 36%, and the total market capitalization of cryptocurrencies growing by 25% quarter-over-quarter. Naturally, the DeFi sector followed this upward momentum, with total locked value exceeding $200 billion, achieving a 28% quarter-over-quarter increase.
Observing the total locked value performance across major blockchains, most chains recorded steady growth, except for Tron, which showed a decline of 8%. In terms of market share, Ethereum maintains its leading position with an absolute advantage, dominating 62% of the total TVL in the DeFi sector, followed by Solana with a 10% share.
The standout this quarter is Hyperliquid L1, whose TVL soared by 547%. This high-performance Layer 1 blockchain is designed for on-chain perpetual contracts and spot trading, using a HyperBFT consensus model inspired by HotStuff.
We also researched the most active DeFi decentralized applications in Q2 2025, delving into the areas of highest user participation.
Finally, we analyzed the investments flowing into the DeFi sector this quarter. The sector raised a total of $483 million, a 50% decrease compared to Q1. Year-to-date in 2025, DeFi projects have received approximately $1.4 billion in funding. While this figure indicates a slowdown compared to the explosive growth seen in past cycles, it still reflects stable interest in the sector and may indicate a more mature direction for capital allocation. Let’s see how the trends develop for the rest of this year, but for now, it seems that the trend is stabilizing.
3. NFT sales surged by 78%, while trading volume declined: RWA and gaming lead the market shift.
We all hope that the NFT market will see a revival, though overall attention remains, some core data is still not optimistic. This quarter, NFT trading volume plummeted by 45%, but transaction volume grew by 78%. This confirms a long-observed trend: NFTs are becoming increasingly affordable, but market heat has not waned; instead, it has shifted in nature.
To better understand the reasons behind this shift, we sorted out the highest trading volume NFT categories this quarter, and the data revealed an interesting phenomenon: new narratives are emerging, while old narrative patterns are also making a comeback.
Data shows that trading volume for individual avatar NFTs has been severely impacted, dropping 72%. In contrast, real-world asset (RWA) NFTs surged to second place in trading volume rankings with a 29% increase. Art NFTs saw a 51% decline in trading volume, yet transaction volume soared by 400%, indicating that art prices have significantly dropped, making art NFTs more accessible to ordinary buyers.
A recently returning trend is domain NFTs, with both trading volume and sales rising. This increase is mainly driven by the TON blockchain ecosystem, as Telegram users are rushing to purchase anonymous domain names based on digital numbers. These domains can be linked to Telegram accounts without needing to bind a SIM card, clearly sparking market enthusiasm due to this highly specific use case.
After understanding which categories are trending, we began to focus on the number of traders to determine whether market participants are continuously growing or returning.
This quarter, the average monthly NFT traders reached 668,598, a 20% increase from the previous quarter. Coupled with the surge in sales volume, this indicates that users are slowly but steadily returning to the NFT space, even though their motivations may differ from those during past booms.
Despite the significant drop in trading volume, OpenSea still maintains its leading position. However, its sales volume has risen in tandem with the Courtyard platform. This surge for OpenSea is closely tied to the news of its upcoming SEA token launch. This airdrop will target both long-time users and current active users on the updated version of the platform. As a result, many users are actively trading low-priced NFT collectibles to earn points in an attempt to maximize future rewards, which is a classic operation often seen in other airdrop activities.
Meanwhile, the Courtyard platform has rapidly risen to become the second in the industry. This clearly indicates that the narrative around RWAs is not only heating up in the DeFi sector but also stirring waves in the NFT sector. Frankly, this development is encouraging. The tokenization of physical assets could very well become a key catalyst for pushing NFTs into the mainstream spotlight.
We also investigated which product series dominated in Q2 2025, and the data showed an unexpected shift.
After a considerable period (possibly several years), a gaming NFT collection has topped the quarterly trading volume for the first time. Guild of Guardians not only entered the top five but also occupied two positions, surpassing blue chip projects like CryptoPunks and Bored Ape Yacht Club. This confirms the overall trend we have observed: the activity in the NFT market in Q2 was primarily driven by RWAs and gaming assets. Now, we finally have data to support this assertion.
4. The losses of $6.3 billion due to exploit attacks in Q2 were among the worst quarters since the FTX collapse.
We had hoped that after so many years, the entire industry would have learned lessons to remain vigilant, treat user funds with greater caution, and achieve at least a certain level of mature development. Unfortunately, the reality this quarter is quite the opposite. In Q2 2025, the Web3 space suffered losses of $6.3 billion due to hacker attacks and security vulnerabilities, an increase of 215% from the previous quarter, setting one of the heaviest loss records since the FTX collapse.
If there is any glimmer of hope, despite its extreme rarity, it is that 87% of the losses came from a single event: the Mantra crash incident. From certain perspectives, this may be a positive signal: there were only 31 security incidents throughout the year, which is not too many; it is just the severity of a single case that inflated the overall losses. That said, it does raise the question: are we truly building safer and more reliable products, or are we merely relying on luck to avoid disaster?
To be precise, the top five events this quarter are as follows:
Mantra insider sell-off event (April 13, 2025): The price of Mantra's token OM plummeted over 90%, evaporating $5.5 billion in market value in an instant. This incident has been confirmed as a result of coordinated selling by insiders, rather than a technical flaw in the smart contract.
Individual user private key theft incident (April 28, 2025): Due to a social engineering attack, a personal user's cryptocurrency wallet was stolen, resulting in the loss of 3,520 Bitcoins (approximately $330.7 million).
Cetus Protocol hacking incident (May 22, 2025): The mainstream DEX of the Sui ecosystem was attacked, resulting in the theft of $260 million, causing the platform's token price to plummet by over 90%, and smart contract activities had to be suspended.
Nobitex exchange hacking incident (June 18, 2025): Iranian crypto exchange Nobitex was hacked, resulting in losses exceeding $82 million. The pro-Israel hacker group Gonjeshke Darande claimed responsibility for the attack and threatened to leak the platform's internal code and user data.
Regarding the UPCX protocol vulnerability incident that occurred on April 1, 2025: Attackers infiltrated the ProxyAdmin smart contract, implemented illegal upgrades, and abused administrative privileges, draining funds from three management accounts in three stages, stealing a total of 18.4 million UPC (approximately $70 million).
This is indeed frustrating. It makes you question how much progress we have really made. At the same time, we know that many projects are actively pushing for more robust security infrastructure, audits, and emergency response plans.
As developers, investors, and users, the most we can do is stay vigilant about security, be informed, and act cautiously.
Use tools like DappRadar to verify the projects you interact with. While this is not always foolproof, it's a good starting point.
5. Conclusion
As Q2 2025 comes to a close, it is clear that DApps are entering a new phase, marked by integration and transformation. Although overall activity (referring to the number of daily active wallets) stabilized at around 24 million, we are witnessing a significant shift in user behavior and industry-leading sectors. Driven by emerging narratives such as InfoFi and the AI agent economy, AI and social DApps are accelerating their rise. The NFT sector is also undergoing transformation, with RWAs and gaming assets dominating, indicating a directional shift from speculative hype to practical value.
Even with capital cooling, DeFi maintains its core pillar position due to strong total locked value growth and price recovery. However, the surge in losses caused by exploits has sent a clear warning to the industry: the development boom without reliable security measures may hinder its progress.
It is evident that users have not left this space; they have simply chosen different ways to experience it. The current challenge is to create DApps that are both attractive and ensure security, sustainability, and the creation of real value. We will closely monitor these future developments and continue to provide in-depth coverage.