Q2 2025 Dapp Market Report: The Rise of AI Applications, RWA and Game NFTs Leading Industry Transformation

Despite the rebound in cryptocurrency market prices and the overall positive sentiment, the Dapp ecosystem presents a complex and changing landscape. AI applications are experiencing explosive growth, the value of NFTs is shifting from ostentatiousness to practicality, while DeFi is navigating the contradiction between rising total locked value and shrinking financing. These data not only reflect market activity but also reveal the real direction of users, the lagging sectors, and the key trends that are reshaping the future of Dapps.

In the current market environment, the era of relying solely on speculation to drive the market is over. Users are starting to pursue real value: whether it's AI applications that can complete tasks, NFTs linked to physical assets, or DeFi platforms that provide sustainable yields. However, the risks remain high: the cost of security breaches has risen dramatically, highlighting the fragility of trust and the danger that even the slightest negligence can be exploited maliciously.

This report provides an in-depth analysis of the changes in the industry landscape, and comprehensively examines the data dynamics in DeFi, NFT, gaming, AI, and other fields. From wallet activity and transaction volume to apps and money flows, we track key metrics and focus on the core narratives shaping the crypto industry in Q2 2025.

Key findings:

1. In the second quarter of 2025, the average daily active unique wallets for Dapps was 24.3 million, a slight decrease of 2.5% month-on-month, but a significant increase of 247% compared to the beginning of 2024.

2. The total locked value in DeFi reached $200 billion, with a quarter-on-quarter growth of 28%, mainly benefiting from a 36% rebound in Ethereum prices. However, the financing amount in the DeFi sector declined by 50% quarter-on-quarter, with only $483 million raised in the second quarter, bringing the total financing amount to $1.4 billion for the first two quarters of 2025.

3. NFT trading volume fell by 45% to $867 million, but the number of sales surged by 78% to 14.9 million, reflecting a significant drop in the average market price, while the number of traders increased by 20%.

4. RWA NFT trading volume increased by 29% to move to second place in the category, with the Courtyard platform becoming the second-largest NFT marketplace by trading volume in the quarter.

5. The trading volume of Guild of Guardians NFT has soared to first and fourth place, surpassing BAYC and CryptoPunks, marking a turning point for game-related NFTs.

6. Web3 lost $6.3 billion due to security incidents, an increase of 215% compared to the previous period. The Mantra incident alone resulted in a loss of $5.5 billion, making it the second largest security incident in the crypto industry since the FTX bankruptcy case in 2022, which resulted in a loss of $8 billion.

1. The number of daily active independent wallets for Dapps remains stable at 24 million, with significant growth in the AI and social sectors.

Dapp activity edged down 2.5% in the quarter, with an average of 24.3 million daily active unique wallets. Nonetheless, we can assume that the ecosystem has stabilized at this level, which is both a sign of the industry's gradual maturity and a sign that users are continuing to interact with Dapps across multiple application areas. It's important to note that many users operate multiple wallets, so there is a discrepancy between the number of daily active unique wallets and the actual number of users. However, this metric is still an important measure of user engagement. Just a few quarters ago, the number of daily active unique wallets was still around 5 million, and its growth rate is very obvious.

The number of active wallets in DeFi and GameFi has both declined, with DeFi down by 33% and GameFi down by 17%. On the other hand, Social and AI-related Dapps have seen growth, which aligns with broader industry trends.

In the Social domain, the rise of InfoFi is notable, with platforms like Kaito and Cookie DAO leading the way. In the AI sector, agent-based Dapps are showing strong momentum, with Virtuals Protocol standing out.

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As expected, these shifts at the sector level have also affected the distribution of dominance. The decline in activity in the DeFi and Gaming sectors has led to a reduction in their market share, while the AI and Social sectors have seized and expanded more share. Comparing the second quarter of 2025 with the first quarter, it is evident that the AI sector is rising rapidly, with the Social sector closely following. By the end of this year, it would not be surprising if AI surpasses either Gaming or DeFi in dominance.

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In fact, among the top-ranked Dapps in terms of independent wallet numbers this quarter, there is an artificial intelligence Dapp that ranks first. The remaining spots on the list are occupied by several well-known projects, primarily from the DeFi sector. Given that these projects have maintained long-term stable operations amidst the Meme coin craze and Agent token frenzy, such a distribution is also understandable.

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In addition, this quarter, we've added a new "dormant Dapp" metric to track dapps that were active in Q1 2025 but ceased to be active in Q2.

Focusing on several major categories for analysis: the number of inactive decentralized applications in the DeFi sector increased by 2%, games grew by 9%, and NFT applications rose by 10%. This analysis specifically included high-risk applications, which saw their inactivity rate actually decrease significantly by 40%, indicating that they are still in continuous use and rarely abandoned. However, the most surprising aspect is in the artificial intelligence sector, where inactive AI applications surged by 129%. Although this percentage looks astonishing, it actually corresponds to only 16 applications. Nevertheless, this phenomenon raises important reflections: it highlights that these projects (especially in gaming and AI) are still in their early stages of development, and without sufficient financial support, achieving mainstream application is extremely challenging. In the Web3 space, user retention remains the most severe challenge, and this data undoubtedly confirms that.

2. Total DeFi lock-up soars to $200 billion in Q2 2025, but funding plummets by 50%

This quarter's macroeconomics has been like a roller coaster, and the DeFi sector has not been immune to this turmoil. Nevertheless, the market still shows positive signals: first, the cryptocurrency market prices have rebounded strongly, with Bitcoin rising 30% compared to the first quarter of 2025, Ethereum climbing 36%, and the total market capitalization of cryptocurrencies increasing by 25% quarter-on-quarter. Naturally, the DeFi sector follows this upward trend, with the total value locked exceeding $200 billion, achieving a quarter-on-quarter growth of 28%.

Observing the total locked value performance of major blockchains, most chains recorded steady growth, while TRON showed a downward trend with a decline of 8%. In terms of market share, Ethereum still dominates the DeFi sector with an absolute advantage, occupying 62% of the total TVL, followed closely by Solana with a share of 10%.

The brightest of the quarter was Hyperliquid L1, whose TVL skyrocketed by 547%. This high-performance Layer1 blockchain is purpose-built for on-chain perpetual contracts and spot transactions, using the HotStuff-inspired HyperBFT consensus model.

Finally, we analyzed the investment that poured into the DeFi space during the quarter. A total of $483 million was raised in this area, down 50% compared to the first quarter. So far in 2025, DeFi projects have raised about $1.4 billion in funding. While this figure indicates a slowdown from the explosive growth we've seen over the past few cycles, it still shows a steady interest in the sector and could also imply a more mature direction for capital allocation. Let's see where the rest of the year goes, but for now, it looks like the trend is stabilizing.

3. NFT sales soar by 78% while transaction volume declines: RWA and games are leading the market shift

We all look forward to a recovery in the NFT market. Although overall attention remains, some core data is still not optimistic. This quarter, NFT trading volume plummeted by 45%, but trading volume instead increased by 78%. This confirms the trend we have observed for a long time: NFTs are becoming increasingly affordable, but the market enthusiasm has not faded; rather, it has shifted in nature.

To better understand the reasons behind this transition, we have sorted the highest trading volume NFT categories for this quarter, and the data reveals an interesting phenomenon: new narratives are emerging while old narrative patterns are making a comeback.

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Data shows that the trading volume of personal avatar NFTs has suffered a heavy blow, plummeting by 72%. In contrast, real-world asset (RWA) NFTs have surged to second place in the trading volume leaderboard with a 29% increase. The trading volume of art NFTs has decreased by 51%, but the transaction volume has skyrocketed by 400%, indicating that art prices have dropped significantly, making art NFTs more accessible to ordinary buyers.

The recent trend of returning is domain NFTs, with both trading volume and sales soaring. This growth is primarily driven by the TON public chain ecosystem, as Telegram users are rushing to purchase anonymous domain names based on digital numbers. These domain names can be linked to Telegram accounts without the need to bind a SIM card, and this usage scenario, which fits specific needs very well, has clearly sparked market enthusiasm.

After understanding which categories are becoming trends, we begin to focus on the number of traders to determine whether market participants are continuously growing or returning.

In this quarter, the average monthly NFT traders reached 668,598, an increase of 20% compared to the previous quarter. Coupled with the surge in sales, this indicates that users are slowly but steadily returning to the NFT space, although their motivations may differ from those during past booms.

Despite a significant drop in trading volume, a certain trading platform still maintains its leading position. However, its sales volume has risen in tandem with the Courtyard platform. This surge for the trading platform is closely related to news about its upcoming token launch. The airdrop will target both long-time users and current active users on the updated version of the platform. This has resulted in many users actively trading low-priced NFT collectibles to earn points, attempting to maximize future reward returns, which is a classic operation often seen in other airdrop activities.

At the same time, the Courtyard platform has quickly climbed to second place in the industry. This is a clear indication that the RWA narrative continues to heat up not only in the DeFi space