Overview of Web3 Development in the First Half of 2024

Ethereum

Zero Knowledge

The ZKVM and ZKEVM technologies continue to develop in the first half of 2024, with more and more projects shifting from ZKEVM to ZKVM architecture. The launch of Plonky3 has accelerated this transition, as its performance surpasses that of Halo2. Currently active virtual machines include ZKWASM, Succinct's SP1, a16z's JOLT, and Risc0, among others. In terms of ZK middleware, proof verification systems remain active, with some projects collaborating with Eigenlayer to gain security. The market is gradually shifting towards adopting hybrid solutions of OP and ZK to improve proof efficiency.

MEV, chain abstraction/account abstraction, intention

In the MEV field, Flashbots is exploring products that utilize Intel's Software Guard Extensions. Fully Homomorphic Encryption ( FHE ) has emerged as a potential solution against MEV. The block building market is highly concentrated, with Beaverbuild, Titan Builder, and Rsync Builder dominating. Over 90% of blocks are transmitted via relays, and Titan Relay is growing rapidly.

In terms of chain abstraction and account abstraction, NEAR has launched a multi-chain signature feature. Smart contract wallets play a crucial role in providing a seamless user experience. The number of account abstraction accounts has exceeded 12 million, with UserOps call counts surpassing 49 million. The inclusion of EIP-7702 will bring an even more seamless experience.

Bitcoin

Interest in Bitcoin Rollups has waned, but technological breakthroughs like BitVM provide new opportunities for Rollups. Yield-oriented Bitcoin strategies have garnered attention, with projects like Mezo integrating various products. BRC-20 tokens are performing weakly, and interest in Runes is diminishing. Bitcoin Staking can be categorized into three types: principal slash, interest slash, and no slash.

In the DeFi sector of Bitcoin, there are more applications for lending and stablecoins. Competition for wrapped BTC is intensifying. On-chain DEXs mainly use PSBT, and some projects employ pre-confirmation strategies in the mempool. MEV scenarios are becoming more active, primarily driven by transaction acceleration services.

In terms of technological development, OP_CAT has been enabled in the Bitcoin trial client. BitVM2 has enhanced the verification capabilities of complex computations. Progress has been made on solutions related to channels and Joinpool, such as Ark v2 and Mercury Layer.

Solana

Institutional interest in Solana is increasing, as Paypal has launched PYUSD on Solana. The launch of Solana Actions and Blockchain Links(Blinks) provides a more seamless experience for retail users. Memecoins remain an important part of the ecosystem, and the launch of pump.fun further validates this. The introduction of the token extension feature allows tokens to have more customization capabilities.

TON

TON performed exceptionally well in the first half of 2024, with an increase of over 200%. Telegram's large user base and built-in wallet are its advantages. Tap-to-earn games like Notcoin have gained widespread attention. TON launched an advertising revenue-sharing mechanism and an ecological fund, and collaborated with the Apple Store to introduce the TON Star Coin model.

Restaking(Restaking)

Eigenlayer has become a major driving force behind the trend of restaking, with a TVL reaching a peak of $20 billion. Currently, there are 16 active AVS, and EigenDA supports the restaking of Eigen tokens. The LRT projects adopt different designs and strategies, resulting in varying performances.

Babylon allows Bitcoin holders to stake Bitcoin to secure the PoS chain. The ecological projects cover multiple areas including Layer 2, DeFi, and liquid staking.

Modularization

Data availability ( DA ) domain participants include Ethereum, Celestia, EigenDA, Avail, and NearDA. Ethereum remains the preferred choice for rollups, with main users including Taiko, Base, Scroll, etc. Celestia's main users include Orderly, LightLink, Manta Network, etc.

In the Rollup field, Arbitrum, Base, and OP Mainnet have clear leading advantages. RaaS is mainly provided by Arbitrum Orbit, OP Stack, ZK Stack, and Polygon CDK.

DePIN

DePIN has gained significant attention in the first half of 2024, mainly due to the appeal of Solana and interest in the AI field. Internet of Things sensors/wearable devices, data markets, and wireless networks are the main segments.

AI x Crypto

The demand for storage, computing, and network resources has surged due to AI, making blockchain technology a viable solution. There is a clear trend of combining computing infrastructure and data tracks with AI. Key participants include projects in areas such as data sources/annotation/market, computing networks, validation networks, proxy networks, and AI-driven applications.

RWA

The real-world assets ( RWA ) sector continues to make progress, with private credit and US Treasury bonds being the most关注的 fields. Institutional investors are increasingly interested in tokenizing financial products using blockchain technology, but regulatory risk remains a major consideration.

Games and Entertainment

Aside from the TON mini-game, market sentiment towards games remains sluggish. IMX, Polygon, and Ronin are popular gaming chains. The integration of games and AI has yet to show significant progress.

SocialFi

SocialFi hotspots include the continuation of Friend.tech, breakthroughs from Farcaster, and the explosion of TON/TG social applications. The Frames launched by Farcaster received positive feedback and significantly enhanced the user experience.

DeFi

The growth of DeFi is mainly attributed to Eigenlayer and Ethena. Stablecoins have received a new wave of attention from developers. Ethereum still leads in terms of TVL, with Blast and Base performing significantly. The CeDeFi model reflects the demand for sustainable and secure returns on on-chain assets.

Institutional Services

The institutional service sector mainly focuses on trading infrastructure, institutional-grade staking, CeFi lending, yield-bearing stablecoins, and derivatives platforms. Although the overall financing trend has declined, crypto-related fintech companies remain relatively active.