Cointime

Cointime

Download App
iOS & Android

Ethereum Wrapped: An Onchain Year in Review for 2023

From J Hackworth Data @ Variant

At the end of 2022, the crypto world was grappling with the collapse of FTX and market sentiment was grim. Today, the industry is buzzing with excitement and positivity from crypto users and builders alike.

So, what does the onchain data tell us about 2023? After it felt like the whole internet spent a week sharing their Spotify Wrapped stats in December, I wondered what an Ethereum Wrapped would look like.

At the end of 2022, the crypto world was grappling with the collapse of FTX and market sentiment was grim. Today, the industry is buzzing with excitement and positivity from crypto users and builders alike.

So, what does the onchain data tell us about 2023? After it felt like the whole internet spent a week sharing their Spotify Wrapped stats in December, I wondered what an Ethereum Wrapped would look like.

In this post, I explore all 372 million transactions to determine what activities and trends shaped Ethereum in 2023.

In 2023, Ethereum users and degens…

Faced the bear market head-on

As we spent most of the year in a tough bear market, it’s no surprise that metrics dropped across the board. But it wasn’t all bad.

Source: Dune, Defillama

Downside: 2023 saw a dip in all the big metrics. Notable hits included total gas fees (-26%), NFT volume (-59.9%), and DEX volume (-35%)

Upside: We ended the year on a high note. TVL (total value locked) increased by 33% year to date likely due to an increase in ETH and other token prices. Despite some metrics not having the most impressive year, activity is now on the rise, including $20 billion in stablecoin inflows since October[1] and a strong upward trend in gas usage.

Source: Hildobby, Ethereum Gas Fees

Diving further into what's happening onchain, we can see three major trends in 2023 that are shaping the Ethereum ecosystem:

  1. L2 growth
  2. DeFi driving gas demand while NFT interest declines
  3. Increased amount of ETH staked

Embraced Layer 2s

Despite a decrease in Ethereum’s activity, L2 usage continues to grow. The year began with an estimated 16 live L2s and $4.95B in TVL. By the end of 2023, there were over 34 L2s and $20.74B in TVL [2].

Source Value Locked, L2 Beat

Increased adoption of L2s led to a surge in activity. Active addresses on L2s increased from under 70,000 addresses to over 400,000 addresses, exceeding even Ethereum’s total addresses

Source: Dune

While L2s collectively exceeded Ethereum's active addresses, there’s still no one L2 coming for Ethereum’s crown: only on 9 days in 2023 did a single L2 surpass Ethereum’s active addresses (zkSync, Arbitrum). The takeaway: L2s still need to further develop their ecosystems and infrastructure to rival Ethereum’s activity.

Source: Dune

In 2023, L2s made significant progress by drawing new capital and users, offering cost-effective features for protocols, and allowing the creation of unique applications that aren’t feasible on Ethereum.

Went deeper down the DeFi rabbit hole

What is a Wrapped list without a top ten? Below, you can see a list of the top ten entities with the most transactions this year and categories by gas.

One clear takeaway: Ethereum mainnet activity in 2023 concentrated around DeFi.

Source: Dune

Source: Artemis BAM

You’ll notice two things right away:

  • USDC and Tether were two of the leading applications by transactions and accounted for 7% of gas usage, highlighting the demand for stablecoins on Ethereum.
  • DeFi, led by Uniswap, made up 41% of Ethereum gas usage, emphasizing the important role DeFi and DEXs play in Ethereum’s use case.

DeFi really had quite the year. When the year began, in the month of January, DeFi accounted for about 31% of Ethereum's total gas, but by year's end, it used nearly half of Ethereum's gas.

Source: Artemis BAM

While a majority of gas burned is from DEXs, some other noticeable strong performers:

  • Maker had its best year for total fees with over ~$105M fees[3]  and hit all-time highs in terms of daily revenue this year
  • Curve and Aave offered new stablecoins that have grown by over ~103M and ~34M, respectively[4]
  • Tokenized Treasuries, part of the surge in Real World Assets, grew to over $450M within a year on Ethereum [5].

Cooled it on NFT trading

As DeFi began to consume more blockspace on Ethereum, NFT trading activity declined. NFT gas usage on Ethereum dropped from 32% in January to 7% in December[6], indicating a waning interest in NFTs.

In addition to this, NFT volume hit a two-year low in September 2023. Still, recent L2 upticks and new excitement around NFT use cases show us that no one can be sure what happens next with NFTs.

Source: Dune

Kept on staking

It's hard to believe that Ethereum's proof-of-take system is only just over a year old.

2023 marked the first year for ETH withdrawals from the Beacon Chain, leading to huge inflows for staking. The Staked ETH supply increased 82.6% in 2023 and now ~24% of the ETH supply is staked[7]. 2023 was the biggest increase in the amount of ETH staked.

Source: 21.co, Ethereum Staking

As more ETH gets staked, it's becoming a key part of the next phase of Ethereum's applications and use cases:

  • Using LSTs in collateral for DeFi applications or even yield on L2s like Blast
  • Supporting new stablecoins such as Lybra, Prisma, and Ethena which collectively have over a $345M market cap [4]
  • Restaking ETH through Eigenlayer to provide Ethereum’s security to other applications

As staking and LSTs become more common, ETH will be used in various ways and the number of use cases for it will continue to grow.

That’s a wrap!

Despite obvious hurdles, Ethereum made strides in 2023.

L2s expanded in adoption, DeFi took over Ethereum, and ETH staking rose. With these trends and many others, Ethereum is setting the stage for a big growth year in 2024.

Sources:

[1] Defillama, Stablecoin Supply on Ethereum: https://defillama.com/stablecoins/Ethereum

[2] L2 Beat, L2 TVL https://l2beat.com/scaling/summary

[3] Defillama, Maker Fees: https://defillama.com/fees/maker

[4] Defillama, Stablecoin Supply https://defillama.com/stablecoins

[5] RWA.xyz, Tokenized Treasuries: https://app.rwa.xyz/treasuries

[6] Artemis, NFT Gas Usage

[7] 21co, Estimated Staking Ratio https://dune.com/21co/ethereum-staking-and-withdrawals

Ethereum
Comments

All Comments

Recommended for you

  • Bernstein Analyzes AI Infrastructure Costs: Up to $39.5 Billion Investment per Gigawatt

    On October 10, Bernstein's research report revealed that the capital expenditure required to build a 1GW data center using different AI accelerator architectures ranges from approximately $34.6 billion to $39.5 billion. Among these, the construction cost of NVIDIA's Vera Rubin architecture is the highest, while OpenAI's self-developed ASIC architecture, Jalapeno, is relatively lower. Bernstein significantly revised its cost expectation for NVIDIA's Rubin NVL72 single rack from $9.1 million to $7.52 million, a reduction of about 17%, primarily reflecting adjustments in expectations for HBM prices and NAND storage capacity. The report also pointed out that the main economic burden of AI data centers is not electricity costs, but rather the substantial capital expenditures and the depreciation they generate.

  • China Securities Regulatory Commission Holds Expert Seminar on Capital Market and Financial Situation

    On October 10, Wu Qing, Secretary of the Party Committee and Chairman of the China Securities Regulatory Commission (CSRC), held a seminar in Beijing to engage in in-depth discussions with leaders of listed companies and experts from securities and fund institutions, gathering opinions and suggestions on the current capital market and financial situation. During the seminar, participants unanimously agreed that China's macroeconomic environment is steadily improving, the industrial structure transformation is deepening, and the capital market is operating robustly, with multi-level market functions being effectively utilized. Although facing some risks and challenges, the trend of high-quality development remains unchanged, and there is confidence in economic operations and the capital market. Additionally, the attending experts provided specific suggestions for better promoting the stable and healthy development of the capital market, which mainly include: continuously strengthening the mechanisms for market stability, further broadening the sources, channels, and methods for medium- and long-term funds to enter the market, and developing patient capital; encouraging listed companies with conditions to increase dividend repurchases and improve mechanisms for investor returns and rights protection; optimizing the issuance and listing system to support the development of high-quality enterprises from various types and industries; enhancing trading supervision and strengthening cross-border risk monitoring and response; and researching and reserving more incremental policy tools, among others. Wu Qing expressed that listed companies and industry institutions are important entities in the market and hopes that everyone will actively provide suggestions to jointly build a better capital market, which will better reward investors and contribute positively to the construction of Chinese-style modernization. Relevant officials from the CSRC also participated in the seminar.

  • Changxin Technology's New Breakthrough: 4F² Architecture Products Expected by Year-End

    On October 10, Changxin Memory's 4F² DRAM architecture research and development recently made significant progress. Dr. Cao Kanyu, the company's president, delivered a speech at the Fourth Integrated Chips and Chiplet Conference, providing a comprehensive overview of Changxin Memory's technological explorations and accumulations in DRAM devices, 4F² architecture, and hybrid bonding. He officially announced that a new generation of DDR5 RDIMM products, incorporating these advanced technologies, is expected to be launched by the end of the year.

  • Hyperliquid Whale Holds $32.36 Million Bitcoin Short Position on 10/10 Crash Anniversary

    On October 10, Bitcoin.com reported that a Hyperliquid whale holds a short position of 391.48 BTC, valued at $32.36 million, on the anniversary of the '10/10 Crash.' The average entry price is $82,863.10, utilizing 13x leverage, with an account equity of $7.19 million and a liquidation price of $99,801.20, approximately 20% higher than the current price. Data shows that this address has conducted a total of 4,726 transactions, with perpetual contracts yielding a profit of $952,000 in the past week and a maximum drawdown of 11.03%. As of the time of writing, the short position has an unrealized profit of about $75,500. On October 10, 2025, the crypto market experienced the largest liquidation event in history, clearing over $19.1 billion in leveraged positions. Bitcoin is currently priced at approximately $82,754, down about 34% from its historical peak of $126,080. According to Coinglass, if BTC rises to $85,000, around $3.3 billion in short positions will be at risk. Hyperliquid has approximately 38,040 BTC in open contracts, with this whale accounting for about 1%.

  • Morgan Stanley Increases Bitcoin Holdings to 10,639 Units

    On October 10, Morgan Stanley increased its Bitcoin holdings by 91.69 units through its spot Bitcoin exchange-traded fund MSBT, bringing the total holdings to 10,639 units, currently valued at approximately $880 million.

  • Strive Raises Approximately $55 Million, Enough to Purchase About 638 Bitcoins

    On October 10, according to Bitcoin.com, Strive's SATA preferred stock raised approximately $55 million this week, sufficient to buy about 638 bitcoins. This figure comes from a weekly dashboard snapshot provided by the tracking platform Bitcointreasuries.net, which only accounts for transactions with a face value of $100 or more, and estimates the number of new shares sold through the ATM program based on capture rates adjusted by SEC filings. SATA traded above face value for most of October 5 and 6, but fell below face value from Wednesday to Friday, leading to a suspension of issuance—this is an inherent brake in such mechanisms: issuing new shares below face value would erode the program's commitments and requires buyers to push up the price for resumption. During the same period, Michael Saylor's Strategy did not sell any STRC shares from September 28 to October 4, while the 334 BTC purchased from October 1 to 4 were funded by the sale of MSTR common stock, increasing its holdings to 848,000 BTC. As of October 2, Strive held 29,462 BTC. The 8-K filings from both companies on Monday are expected to confirm the actual number of bitcoins purchased.

  • State Council Issues Guidelines for Building a National Blockchain Network

    On October 9, according to Xinhua News Agency, the Central Committee of the Communist Party of China and the State Council issued the "Opinions on Developing New Quality Productive Forces," which consists of seven sections and nineteen articles. The guidelines propose leading with technological innovation and focusing on significantly enhancing total factor productivity as a core indicator. They emphasize innovation-driven development, reform as a key priority, adapting to local conditions, and establishing foundations before breaking new ground. In terms of industry, the guidelines call for cultivating and expanding emerging industries, strategically planning for future sectors such as quantum technology, biomanufacturing, hydrogen energy, nuclear fusion energy, brain-computer interfaces, embodied intelligence, and sixth-generation mobile communications. They also advocate for the comprehensive implementation of the "AI+" initiative to accelerate the application of new-generation intelligent terminal scenarios like humanoid robots. Regarding incentives and financial support, the guidelines propose establishing a corporate R&D reserve fund system, increasing the proportion of deductible R&D expenses for enterprises, and improving support policies for long-term capital investment in early-stage, small-scale, long-term, and hard technology projects. They aim to strengthen patient capital, enrich the system of technology innovation bond products, support quality tech enterprises in going public for financing, and optimize systems for mergers, acquisitions, and equity incentives for tech companies. The guidelines also stress the importance of avoiding superficiality, seeking grandiosity, and creating bubbles. They strictly prohibit the abuse of policies under the guise of developing new quality productive forces and will hold serious accountability for significant losses caused by blind investments and herd behavior.

  • Grayscale Ethereum Trust ETF Acquires $103.3 Million in ETH Over 20 Days, ETHE Sees $71.6 Million Outflow

    On October 10, monitoring by Arkham revealed that the Grayscale Ethereum Trust ETF has accumulated approximately $103.3 million in ETH over the past 20 days. During the same period, the ETHE fund experienced an outflow of about $71.6 million, while Grayscale clients net purchased approximately $31.7 million in ETH.

  • US Initiates 337 Investigation on AI Server Power Products, 20 Companies Listed

    On October 10, according to Tonghuashun news, on October 9 Eastern Time, the U.S. International Trade Commission (USITC) announced the initiation of a 337 investigation into 'certain vertical power transmission systems, their components, and computing systems containing such systems,' targeting the power supply segment for AI servers. A total of 20 companies are named, including Luxshare Precision, Foxconn Industrial Internet, Hon Hai, Hongbai Technology, Delta Electronics, Quanta Computer, Cloud Computing, Infineon, ChipSource Systems, Flex, and Tianhong Technology, spanning mainland China, Taiwan, the United States, Germany, Singapore, and Canada. The investigation stems from a complaint filed by Massachusetts-based power module manufacturer Vicor on September 9, alleging that the products in question infringe its patents and requesting the issuance of a limited exclusion order and a cease-and-desist order. This marks Vicor's third similar complaint in three years. According to USITC procedures, a target date for conclusion will be set within 45 days of the case being filed, and it will take a considerable amount of time to reach a formal conclusion.

  • Robinhood Crypto Explores Launching Stock Tokens with T. Rowe Price Digital Assets

    On October 10, Robinhood Crypto is exploring the launch of stock tokens linked to actively managed ETFs on the Robinhood Chain in collaboration with T. Rowe Price Digital Assets, which manages assets worth $1.9 trillion. The partnership is in the exploratory phase, and the potential product launch requires legal due diligence, approval from the issuer's board, final terms announcement, and regulatory approval from relevant jurisdictions. There is currently no guarantee that the collaboration will proceed or that the product will be launched, and specific details regarding the format, timing, and applicable regions have yet to be determined.

Daily Must-Read

Popular Activities

RaveDAO at Terra Solis by Tomorrowland: A Female-Led Techno Night Where Web3 Culture Converges

RaveDAO at Terra Solis by Tomorrowland: A Female-Led Techno Night Where Web3 Culture Converges

April 30 - April 30
Dubai

Popular Tags

Cointime
News
Contents
RSS
Company