What does the growth of a blockchain network look like?

Ethereum launched on July 30th, 2015. The motivation was to create a network that expanded beyond the functionality provided by Bitcoin (i.e., money), and would allow for diverse applications of its native token. As the network has grown, this motivation has largely come to fruition; however, different applications have been integrated into the ecosystem at different timescales. Here's a look at the growth of each since Ethereum first went online.

This scatterplot-heatmap hybrid shows the # of projects related to each application on the Ethereum network at different timepoints in its history (quarterly, each year). Applications are grouped into four general categories (general/industry, gaming-related, data-related, and blockchain-related), and sorted most-to-least based on the last timepoint. White lines are provided for visual guidance between each y-axis labels and their corresponding first project.

Observations & interpretation:

  • Blockchain-related tags dominate - On first inspection of the graph, our eyes are drawn to the area with the most heat - the large number of projects with blockchain-related tags in recent years. It makes sense that blockchain-related tags would be most common; every project in this dataset is a blockchain -project, after all. A project dealing with sports NFTs and a project dealing with music NFTs would each be respectively tagged with "sports" or "music", but both would be tagged with "NFTs".

  • Unique timescales of growth - Some categories seem to have their own, idiosyncratic timescales of growth. For example, tokenized gold was the first in the "general" group to have a project, but this category then stagnated - putting it near the bottom of this group in terms of 2023 project numbers (second only to education). Memecoins, on the other hand, were the last category to have a project but the mysterious power of memes has helped it surge to the top of this group (second only to entertainment).

  • Periods of shared growth - Crypto's historic rallies (2017 and 2021) have left a mark on this graph. Many of the categories shown here had their first project on the network around the same time in the beginning of 2017, followed by relatively little growth during crypto winter in 2018-2019. Similarly, we can a handful of applications, such as NFTs and gaming, explode in 2021.

The way this data has been gathered and analyzed has general limitations that apply here and elsewhere. For example, the dataset is limited to projects which had a listed market cap that exceeded 1 million dollars (and this particular analysis deliberately limits that further to the subset on the Ethereum platform for a total of around 1,000). There are, of course, important projects that do not meet these criteria. Additionally, the project sizes reported here are based on the application of categorical tags to each project, which is not an error-proof process. The project numbers may under- or over- estimate ground truth.

There are also some specific considerations to be made for this growth analysis that are somewhat subtle, but the reader should be aware of. Although the intent here was to look at the growth of different applications over Ethereum's history, the data presented was gathered from current listings, which provide less-than-complete picture of this history. Consider projects that have failed, become inactive, or were otherwise removed from listings... ideally, these would still be included - at least for the years they were active - but are not. In a similar vein, currently available descriptions are the basis for categorical applications/tags of each project, and there is an implicit assumption that these are stationary over time. In any case where a project expanded/narrowed/changed its applications, such non-stationarities may not be adequately shown here.

Developed by Jesse Werth for The Data Incubator (TDI) Capstone Project