The decentralized finance ecosystem continues to grow despite recent challenges as overall crypto usage hits record levels, venture capital firm Andreessen Horowitz (a16z) said in a new report.

In its “State of Crypto” report published on Oct. 16, a16z noted that the crypto industry has witnessed a major spike in activity over the past year. The growth trajectory for the industry is “reminiscent of early internet adoption.”

For instance, September 2024 saw 220 million addresses interact with protocols across the blockchain ecosystem—more than triple the figures recorded in late 2023. About 100 million of these active addresses were on Solana (SOL), a blockchain network that has registered a massive spike in activity.

As well as Solana, other networks to see a significant increase in active addresses are Near Protocol (NEAR), Coinbase’s layer-2 network Base, Tron (TRX) and Bitcoin (BTC).

Stablecoin and crypto regulation

The report also highlighted several growth metrics and key issues surrounding the crypto industry since a16z’s first State of Crypto report in 2023.

One major takeaway is that crypto has become a significant political issue amid the U.S. election. However, the United States lags behind the European Union and the United Kingdom in public engagement regarding crypto regulation.

The market has also seen considerable developments around stablecoins, including their regulation and usage. Notably, stablecoins have grown to become one of the top 20 holders of U.S. Treasury securities, with a Coinbase report showing marked growth in Q3, 2024. Major players include Tether’s USDT and Circle’s USDC.

Additionally, infrastructure improvements and the increasing intersection of blockchain technology and artificial intelligence have further bolstered the industry’s growth.

DeFi continues to grow

DeFi has been one of the areas of crypto that saw the most usage across daily active addresses in the past year.

“Since DeFi’s arrival in the summer of 2020, decentralized exchanges, or DEXs, have grown to account for 10% of spot crypto trading activity — all of which occurred on centralized exchanges just four years ago,” the reports reads.

DeFi protocols across the ecosystem now account for over $169 billion in total value locked. Top platforms include Lido, Aave, Uniswap, EigenLayer, WBTC, and ether.fi. These decentralized platforms continue to attract users as traditional financial institutions, such as U.S. banks, face ongoing challenges.

According to a16z, top blockchains in terms of builder activity or interest include Ethereum (ETH), Solana and Bitcoin.

While Ethereum still attracts the most developer activity, with 20.8% of builders, Solana has seen significant growth in this sector, increasing from 5.1% in 2023 to 11.2% in 2024.

Base also recorded a notable jump in developer activity, rising from 7.8% to 10.7% year-over-year. Bitcoin, which has registered a surge in DeFi-related activity, saw an increase in builder interest from 2.6% to 4.2%.

ENA has risen as the top performer in the last 7 days driven largely by key developments within its ecosystem and heightened whale activity.

Over the past month, Ethena (ENA) has surged by 96.6%, driving its market capitalization from $420 million in mid-September to $1.14 billion. Most of these gains occurred in the last 7 days, with ENA seeing a 45.1% rise during that period.

Central to ENA’s price rally has been the ongoing expansion of the Ethena ecosystem. Ethena Labs recently passed a pivotal proposal to integrate Ethereal, a decentralized exchange built on the USDe stablecoin, into its reserve management system.

The integration is expected to enhance liquidity and utility for ENA tokens within the Ethena ecosystem, making it a more attractive asset for both users and investors.

In addition, Ethena developers announced last week their intention to invest $46 million of the reserve fund into tokenized assets, further diversifying their financial strategy. The project has also secured backing from major players like BlackRock and Securitize for its new stablecoin, UStb, bolstering confidence in its ecosystem.

Spike in whale activity

Whale activity has played a major role in ENA’s recent price action. According to data from IntoTheBlock, large holders of ENA accumulated 5.4 million tokens — worth $2.3 billion — on Oct. 15, a sharp increase from $1.18 billion in outflows seen on Oct. 9. Whale buying often signals market confidence or accumulation, potentially driving prices upward and boosting investor sentiment.

Furthermore, Smart Dex traders, which are basically wallets known for consistently executing profitable swaps on decentralized exchanges, acquired 1.34 million ENA tokens over the past week, valued at $506,100 at an average price of $0.32 per token.

Price performance and future outlook

On Tuesday, ENA hit a two-month high of $0.455, following a 45.1% gain over the past seven days. However, the token has since pulled back slightly, trading at $0.4179, down 7.5% over the past 24 hours. This dip is likely due to some profit-taking by long-term holders after ENA’s rapid ascent, a common occurrence following a highly bullish day.

Despite this short-term correction, analysts remain optimistic about ENA’s price trajectory.

According to ‘World of Charts,’ ENA has broken out of a broadening falling wedge pattern, a classic signal of a bullish reversal. The analyst expects the token to rally another 150% in the near term.

Similarly, another analyst, Altcoin Sherpa, forecasts that ENA could reach $0.50 in the short term, provided Bitcoin (BTC) remains stable. If the broader market conditions continue to be favorable, ENA may see further gains before encountering any significant pullback.

The substantial growth in ENA’s price has led to a rise in the number of token holders in profit, with ITB data pointing to over 21% of active ENA holders recording gains, a sharp rise from just 5.7% on Oct. 8. This improved profitability could further encourage retail and institutional investors to hold ENA, anticipating further price appreciation.

Solana-based content delivery network Blockcast has raised over $2.8 million in seed funding led by Lattice Fund to scale its decentralized infrastructure for high-bandwidth content streaming.

According to a press release shared with crypto.news, Blockcast raised $2.85 million in its seed funding round with participation from prominent investors such as Lattice Fund, Protocol Labs, Finality Capital Partners, AllianceDAO, Zee Prime Capital, RW3 Ventures, and angel investors including Anatoly Yakovenko, the founder of Solana.

Blockcast is a decentralized content delivery network built on Solana, aiming to address the growing strain on internet infrastructure. The platform combines traditional broadcasting technology with blockchain to manage the increasing demand for high-bandwidth content such as live streams, software updates, and media releases.

With internet traffic surging by 24% annually and live streaming now accounting for 17% of all global traffic, Blockcast aims to offer a more efficient solution for content delivery.

By utilizing community-operated nodes, Blockcast allows for faster and more cost-effective content distribution. This approach reduces data consumption, minimizes rebuffering and latency, and alleviates congestion for internet service providers, the release noted. 

The goal is to streamline the process of deploying scalable traffic servers closer to users, offering a more sustainable and decentralized way to manage global content demand.

Mike Zajko, Partner at Lattice Fund, noted that the internet’s infrastructure is struggling to meet the rising demand for high-quality content. He highlighted Blockcast’s use of “community-operated nodes” as a practical solution to reshape “how data is distributed and consumed.”

Blockcast plans to use the capital to accelerate the development of its platform, expand its presence in the networked infrastructure ecosystem, and launch its pre-order campaign for home RELAY nodes, which are compact servers designed to improve streaming quality while allowing users to participate in content delivery and earn rewards.

Speaking to crypto.news, Blockcast CEO Omar Ramadan explained that the funding will also go toward “building out global content delivery capacity” and launching “a public testnet for the world’s first decentralized multicast-enabled CDN,” aligning with Blockcast’s mission to revolutionize content distribution.

The funding round comes as venture capital interest in the blockchain and fintech sectors has steadily dropped since April 2024. Despite the waning interest, new entrants continue to emerge, with global investment firm VanEck recently announcing the launch of VanEck Ventures, a $30 million fund focused on fintech, digital assets, and AI.