Ethereum 2023 Review: Stake funds rise by 60%, annual supply decreases by 0.28%, average TVL growth of 333% across 12 major L2s

In 2023, the development of Ethereum mainly revolves around two main lines: liquid staking and Layer2(L2).

In April, Ethereum completed the Shanghai upgrade, opening up staking withdrawals and entering the "interest rate control" era. The upgrade not only did not cause large-scale selling pressure but instead attracted more deposits as the price of the coin rose, making LSD the hottest DeFi track.

The L2 sector is developing rapidly. The Arbitrum airdrop once again staged a "wealth creation myth", which also raised expectations for other L2 airdrops. With the rise of Base and the upcoming Cancun upgrade, technical keywords such as modularity, parallel EVM, data availability, and decentralized sequencers are becoming popular. The rapid development of L2 and the significant price rise of representative assets like OP are making L2 the most anticipated sector in 2024.

The following are the main data on liquid staking and L2 for 2023:

1. After the upgrade in Shanghai until the end of the year, the total amount of Ethereum deposits is approximately 17.3061 million ETH, and the total amount redeemed is about 8.1135 million ETH. The cumulative staking amount has increased by 10.8242 million ETH, with a rise of about 60%, but the growth rate of staking is rapidly declining. This indicates that people's enthusiasm for staking deposits has decreased.

2. Correlation analysis shows that in a short period, when the price drops significantly, more funds flow from DeFi to stake deposits, and Ethereum staking activities may create a "siphon" effect; when the price rises significantly, funds flow out simultaneously from both staking activities and DeFi activities, with no reverse "siphon".

3. In 2023, Ethereum has burned approximately 1.0935 million ETH in transaction fees. The supply has decreased by about 341,800 ETH, a reduction of approximately 0.28%. The overall ETH has achieved a slight deflation, but the degree and trend of deflation are not obvious.

4. Among the 34 L2s, 11 each use Optimistic Rollup and ZK Rollup. Most are in the early stages of technology, with 17 in STAGE 0, which only implements state submission functions, including popular ones like OP Mainnet, Base, zkSync Era, Starknet, etc.

5. The highest TVL in L2 is Arbitrum One, reaching $9.37 billion, followed by OP Mainnet, which reached $6.05 billion. The projects with significant TVL rise this year include Manta Pacific, Starknet, and Polygon zk EVM.

6. The highest total number of transactions for the entire year of 2023 was Arbitrum One, with over 275 million transactions. The second was zkSync Era, with over 218 million transactions. Both exceeded Ethereum's TPS at the end of the year.

7. In 2023, the number of independent addresses and daily active addresses for L2 saw a significant rise. The highest annual increase in independent addresses was recorded by Base, with a rise of over 7166%. The highest annual increase in daily active addresses was recorded by Mantle, with a rise of over 886%.

8. Among the four main Rollup-type L2s, zkSync Era has the highest annual revenue, reaching 22.26 million USD, followed by Arbitrum, at 16.53 million USD. Base and Optimism both have less than 6 million USD.

9. The highest price rise in 2023 was IMX, which increased by over 454%, followed by METIS and OP, both rising over 300%. ARB's price performance was average, only increasing by 14.81% for the year.