ETHKL24 | Zhong Yang Chan, CoinGecko | The State of the Ethereum Ecosystem By the Numbers

[Music] ladies and gentlemen good afternoon welcome back so I asked some of you just know whether had lunch and I think five people responded what about the rest of you you guys had a good lunch Mark downstairs tea Lounge you're not making much noise for people who had a good lunch Make Some Noise guys there we go all right okay can you guys tell me who's speaking next does anybody know okay yes ladies and Gent Gentlemen please welcome on stage for a very important address about the state of the ethereum ecosystem by the Numbers zongyang Chang head of research at coin [Music] [Applause] [Music] gecko hello hello okay great uh good afternoon everybody hope you guys had a good lunch um well the title that I originally proposed was kind of long and this is kind of the shorter title but you know uh still fairly long so I'm about to talk about you know the state of etherum by the Numbers it's going to be pretty data driven like in typical coin gecko Styles since you know work for coin gecko um what let go yes so before we begin obviously none of this is financial advice we do not provide Financial advice you know please take this as information only yeah let's get straight into it so this is what the price chart looks like this is probably what you open coin geeko every other day and or every day multiple times and then you look and you try to see like you know whether the e in your metamask wallet is up or in your in your in your in your Exchange St um the good news is it's in the green right so if you look back in January and I know people uh you know kind of tired everyone's like on on ethereum uh but it's still up by 16 7% and I believe like after last night it's gotten a bit better right um The Challenge I think is that uh compar against you know the overall market and compar against you know who you would think are the peers of ethereum so Bitcoin and soul it's actually not doing as well right so the total crypto Market actually um appreciated by close to 40% uh a lot of it actually driven by Bitcoin Bitcoin is actually up by 54% right uh and 55% right and actually is increasing its dominance so and then you know you have Solana as well so I I guess fundamentally I think you know uh we always say like you know price improves fundamentals right so the better the price the better the fundamentals and unfortunately I guess with ethereum uh it's kind of lagging I guess uh in terms of you know price action uh you can look at you know if BTC ratio I have the so if ratio up as well uh uh pretty much you know one is at the all-time low like close to kind of low uh compared to where it was in 2021 April so e is now like a all-time high um all kind of not good news for ethereum but also I guess if you're a Trader or you know if if you're looking at the price action you're wondering like you know is this sort of like you know the bottom or or whatever relative to to to the other coins right but I think you know it's important to put into context you know price is not the only thing you're at an IFK event so hopefully you care more than the price right um and I think you know if if you just look at you know we just want to look at you know the transactions and all the activity that's happening on chain and you know the the gray bar that I have down there or the gray row or the gray line that right at the bottom is actually ethereum right so that's main net and if you think about it you go back to you know when when you know Ean started talking about scaling and you know uh layer two and you know all all that stuff right uh and just go back to 2021 um you realize that actually it's pretty important because essentially mainnet has maxed out right so the number that I have here you can't really see it but it's about 1 million 1.2 million per day transactions that's going through is actually the same number it's the same number that was that ethereum was processing as of 2020 2021 right so the chain is maxed out even now you say you know whether you think it's a bull market B market Market is still doing about 1 million 1 million plus transactions going through and that's how much the chain can handle right but right now we have layer tools right so you can see even for just the start of the year January 2024 right and up to yeah the date is like September 30th we pretty much almost doubled the number of transactions going through ethereum right what what you would consider ethereum in terms of you know ethereum the ethereum and the broader equ five about six six million transactions a day to about action a day and if you just go back to 2021 not too long ago so like I said we were doing about 1.2 million a day so this is like a 10x increase right in actual transactions that's being executed every day and I think that's a sign of you know where the the the ecosystem has s of grown this wouldn't have been possible without l2s this wouldn't have been possible you know if you know we didn't do the merch we didn't do Danon uh cost didn't come down and all this this other good technical things that happened right so I think it's important to put this into context you can see the different L l2s uh obviously Bas is winning just in terms of like pure transactions they now have about 40% uh and you know just one L2 is doing four times the transactions of main net right so you know this is conscious strategy right this didn't just happen from scratch uh just just happened one day and people fell the tree and suddenly people invented l2s and they could settle on L1 and I think it's a credit to you know the the technical Innovation and the improvements that that have uh been done in the in the last uh couple years as well um the only downside right the only challenge with this right and and I just want people just to put it all in context is the last point there which is unfortunately right now the biggest competitor Solana processes 50 million transactions a day right non-vote transactions this doesn't even count to vote transaction so we're trying to get to Apple to Apple so that is is five times all of what um the entire ethereum s ecosystem is doing and I guess that's the biggest challenge right like you know back in 2021 previous cycle the competition was stiff right you have all these out l1s out chains but it wasn't this stiff right and right now there is a real competition gen that's the genuine competitor on the Block right now uh with the ethereum ecosystem with the evm ecosystem and you know this is this is I guess again fear of comparison competitor this is the first time there's a credible competitor on the Block right and it's actually at this point I guess um attracting more attention right now right on onto the equos uh complement to that is obviously gas fees right and I also want to point out so again if you just look at you know I have this chart now back to 2021 look at how far the gas fees have fallen right so in 2021 it's kind of normal you'll see gas fees going from like you know 250 GR 450 gu I'll say average is around 150 GUI right we're now at 14 GUI right so 11 gray is the average for the whole of September and actually if you look at August right and you could argue it's because not many transactions happening in August um guay is the lowest it's so gas fees in terms of gay is the lowest it's ever been in history it has never been this low right we are down to single digit uh gas uh gay in August uh 6.7 uh average and the lowest was like two two gray on on on a particular day it was like two gray to to execute transaction so most of this is obviously due to dankun right so with blobs with e 4 4844 um all these things come in they reduce you know the the cost of gas fees for l2s which in turn then reduce you know cost of gas fees on mainnet itself right and vice versa and you know really like you know it's it's essentially gone down by one order if you compareed to what it was in 2021 it's the same story as well for L2 so I put up a table and you know I just pick a day you see now that you know they are very very cheap and you know some of these are even cheaper even after you convert to Dollars uh cheaper than Solana right and the whole reason is because of Danon right um you know essentially also you move one decimal point pretty much for most of these chains right um you you you pretty much just move one decimal point it's all all cheaper so this whole idea that you know you know not like dankun is like going to kill ethereum and things like that I think it's kind of policy and you know if you were here early in this morning you talk about you know you hear you know our speakers talk about um you know we need cheaper we need um more true put we need faster we need people to not have to wor people not to worry about gas fees like this is really becoming a reality and I think you know for the infrastructure side it's s of there already and the question that is you know who's going to build the apps that's going to take advantage of all these things right now just from a staking perspective I think uh not much to talk about here um there has been a 16.8% increase uh the amount of e stake actually doubled in 2022 2023 2024 I think we have sort of hit almost like a it's still some steady growth but not not as much we now have about 34.

6 million uh e stake in the network uh in the proo itself that's about 28 .2% of the total e Supply right and you can see you know the companies up here I wouldn't speak too much to this I think you know not much actually changed in the year I think the the the hype thing I guess is reaking right so so this year people start talking about I layer and like all the different LTS so ety Renzo kelp sorry if I didn't mention your protocol um but yeah actually but if you look at the the the amount of e that is restate actually it's only about 17.6% of this 34.6 million right and if you think about it that's only about 5% of the total Supply um there's a lot of hype obviously I just started trading a couple days ago everyone is still paying attention um but I think really the test case here is you know are there really going to be avss that's going to be created uh is there really going to be l2s that going to build on this are these l2s going to actually lead to more fees that are going to be approved to igen L and I think you know so the proof is still we're still waiting to discover whether that's going to be true or not yeah def5 uh I guess quite a few people got ticked off by uh vitalic oroboros sort of uh creat um I I I am one of them I I I will admit I think you know defi Still Remains a key and core part of crypto Define remains a key and core part of ethereum and etherum is the Undisputed leader uh of defi at least still at of this moment uh if you just look at pure tvl numbers right and and I'll support this as well with with a couple different stats as well as I go on uh in the few other slides ethereum still leads all chains by tvl and it's not even closed right so ethereum has like 58.8% share Tron is has got 10% and nobody else and I mean nobody else including Sana has cracked 10% right so so if you just look at where the capital is uh in terms of people using D5 people putting their Capital to work right if you don't count you know people would just hold BTC or hold e and they don't Buck it in any D5 protocol ethereum is still Undisputed and you know this chart I use the stats I purposely took you know no liquid staking right because liquid staking is kind of not really defy kind of defy not really defy right it's kind of cheating a bit like double counting if you included liquid St it's even higher right so ethereum is like 60 plus% dominance over this right and yeah I mean like you know it's I I I don't think there's anything to to argue with this right like you know there are exciting there are new protocols right uh that's happening on Solana and things like that but by and large if we just compare sizes right so if if you're a Malaysia is like you know if you compare like you know I don't know the Busa Malaysia against like the Hong Kong Stock Exchange or even like you know the the the US the stock exchange that's just not the same size we're not talking about the same magnitude and you can see that you know um l2s are coming up as well right so arbitrium and base now have each more than two billion in tvl um blast is doing about 700 optimism so so arbitr Base by and large the the the largest to and you know this this is also good news right so it also we are seeing ethereum increase it's tvl but also there are TV that's also being ACR to the layer tools as well particularly those right um I didn't just just just wrap up I think you know what's also interesting I guess is uh perhaps a sign of where we are in the market as well if you look back to the boot cycle actually RV had more tvl than unisoft if you sum up you know RV V1 V2 V3 uh unisoft V1 V2 V3 uh this has happened again so a actually is now the largest uh D5 protocol in terms of second sort of slide I guess s of tangential to to to the previous one is like stable coins and you know it's it's the same right so ethereum just has more stable coins than everybody else sort of combined right um you know ethereum is 50% of all stable coins all stable coins issued in the market half of them are on ethereum right um Tron has 36% share everyone else less than 3% right so again the the size actually if you look at the numbers is is crazy similar for RW if you know people talk about institutional adoption you know where people are going to create their assets where the traire guy is going to go well turns out they go to ethereum right so ethereum has like 79 81% of of of all rwa is being issued now on chain it's just I had to cross the the chart because I couldn't show a longer line everyone else would would disappear but yeah I think you know just in terms of where Capital again you know just in terms of where capital is going um it's still going to ethereum I guess some people might say like actually we wish it went to l2s and to a certain extent that may be true um but if if you want it to be used you know for trading and things like that but you know with some of these things you know people just you know kind of Buy and Hold they don't swap in and swap out too often you know it's still okay to be on Main net and I think you know there's a certain level of institutional trust uh obviously um living on living uh you know with having an asset that's you know natively issued on on Main net itself um something interest something I guess important to point out as well is you know with with stable coins all the interesting stable coin experiments are still happening on interor right you don't hear about you don't hear too much about a a sort of Novel stable coin that's being issued on on a different blockchain right etina is is sort of is started on ethereum right um all the Go stuff and the curve USD stuff whether you believe is going to work it's not that big in tvl or whatever all these interesting experiments are still happening on on on YouTube trading volume tells the same story 223 billion now of uh of of volume is going through uh ethereum ecosystem dexes across you know ethereum base arbitrium optimism I believe I when I did the math right this makes up about 60% of all de training volume yeah uh going across uh the entire defi ecosystem right um what's also interesting I guess is you know where base and arbitrum are in terms of the ranking uh you know you can see this goes by you know just the order so etherum Solana base arbitrum ahead of you know the 2021 if people can remember the BC's the trons polygon to a certain extent have launched right the all L1 all evm l1s which you would think you know direct competitors they have the same depths you know they they have the same you know sort of evm structure everyone knows how to use a metamask they already ahead of these guys in just in terms of um trading volume and earlier in terms of TV as well right so pretty interesting um and I think you know all signs that you know whatever bad things that you see is still you know people are down people are kind of sad about the price but like lots of things are still happening yeah obviously we all wish it could be bigger but you know that's a competitor so one of my last few slides um obviously we saw the launch of uh ethereum ETFs uh us sport etherum ETFs on July 23rd um that came in and then you know it sort of been I guess a quarter of this uh unfortunately it's not been great uh just from a flows perspective that's been 500 five 0 3.

6 million uh net outflows uh largely due to uh you know gr scale right if so we saw the same thing happen with uh the US sport Bitcoin ETFs right um so if actually had 2.9 billion in outflows and you know net total net outflows about 53 so the rest of the funds actually saw about um 1.5 billion in inflows cor right so if you if you just you know s do the math um uh however I think you know unlike the Bitcoin one where you know black rocks uh ITA actually became the largest um uh sport Bitcoin ETF uh in this case gray scale is still way ahead of the game right so gray scale has about the e e has about 4.33 billion they actually launched on the same day the if mini Futures uh uh sorry the E mini ETF which is actually the same thing but just a cheaper version like with a lower fee that has about a billion uh so that's second and Then followed close closely by Black Rock yeah um if you look if we look at AUM on September 30th it's at about 7.14 billion uh that's about 11% of where the US sport Bitcoin EFS are um not great uh definitely like if you just compare on coin Geo you know relative market cap or fdv is not the right ratio yet but I think you know this may evolve and continue to evolve in the future certainly I think you know the if with draws have not really tapered off like we've seen from the bit from the Bitcoin ETFs so there may be somewhere to go until you reach some sort of steady state but I think you know yeah like I said I think you know when when we look at you know ethereum and you know people get fixated about the price um it's also important to remind people sort of what what's important or at least you know what what people interium s of care about as well and these are some of the interesting things so um just wanted to read out the the line that I have so because it's quite a mouthful right so it is meant to be decentralized censorship resistant credibly neutral settlement layer and state engine uh state state machine right or or World computer as we heard earlier today going back to the 2017 term um and if you look at the health of the protocol itself it has never been better I think just in terms of you know achieving these goals that that that I just read out earlier right you know there never been more diversity in terms of clients right people are using different consensus clients people are using different execution clients there are more validators so that's a validator chart there are more validators than ever before right on ethereum that's a million I think we've passed a million validators on the network in fact it's become a problem for the ethereum foundation they actually want to reduce the number of validators now because there's just too many of them which is a good problem to have um earlier in the year you may have uh remember we we we worry about whether you know block Builders will will censor ofac transactions will will will you know stop people's transactions from going through if you look at the chart the green part is obviously the non- sensoring part and you know largely you know most Builders have actually all move to non- sensoring right so you can be confident if you put your transaction through uh onto the network it will be processed may take a bit longer if you're doing some dodgy things but it will be processed that's the road map um the other thing obviously is you know layer tools and you can see I guess this is from l2b um you know where the layer tools are and you know one of the things that people are focused on right now as well on ethereum is you know when are they going to decentralize their sequences for some of them they need to take the first step where are the fraud proofs and things like that I think those are things that will continue to dominate composition at least within the technical community and I think you know again place to the place to the um aims of being decentralized and censorship resistance um lastly obviously you know ethereum is not just about financial services I guess and not just about financial sector there are still all this other things that that happen and I think you know what's good at least hearing from what's Happening this morning and also the discour on Twitter and other parts is that you know we are thinking more now about um nonfinancial use cases use cases that can actually be useful to normal people that can on board the next generation of a billion or or even more users on on onto ethereum so yeah that's that's sort of the end of of my presentation I hope you found this useful and I think you know was really trying to sort of yes the price like that but like you know pay a very a more optimistic and more holistic way to look at you know where the network is where the ecosystem is and you know um yeah you know hopefully people are a bit more optimistic working out this this Hall after listening to the Ben so yeah thanks everyone ladies and gentlemen thank you zong for that uh very enlightening presentation so if you guys have just joined us cuz I see some of you have just walked in just now uh tldr uh ethereum is doing fine this just Solana is making us look bad once in a while