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State of Blockchains 2019: Green shoots of adoption emerge from 2018 crypto crash

January 2019

Posted by

Joel John

Research Analyst

Joel has been working on blockchain related projects since 2012. His foray into the industry began with an attempt to create an exchange/remittance mechanism for blue-collar laborers in the middle east to send money home in a cost effective fashion. ...read more
research

State of Blockchains 2019: Green shoots of adoption emerge from 2018 crypto crash

 

Outlier Ventures’ State Of Blockchains 2019 report highlights increasing user adoption whilst data shows a decline in ETH price isn’t due to ICO sellers  

 

State of Blockchains 2019: Green shoots of adoption emerge from 2018 crypto crash Outlier Ventures

 

Outlier Ventures have published the Q4 report in its State of Blockchains series, which provides an overview into blockchain investment and market trends worldwide. The report reveals a range of insights into the market:

 

1. Despite declines in token prices, there were strong signs of product adoption in Q4

Brave, the tokenised web browser, leads the pack of blockchain based apps and closed 2018 with an impressive five-fold increase in average monthly users. In addition, the browser firm struck a major deal with HTC to become the default browser on its handsets.

  • Brave now claims 5.5 million unique monthly users for its privacy-protecting web browser, representing 5X growth
  • Over 10 Million Android users download Brave in 2018 – with mobile users representing 80% of the company’s total users
  • 28,000 verified publishers are now represented meaning they form part of the Brave tokenised ecosystem where users are rewarded for their attention when consuming advertising.

Lawrence Lundy-Bryan, Partner & Head Research, Outlier Ventures:

“We are witnessing an increasing number of teams launching products and seeing early signs of traction. 2019 will likely witness a handful of blockchain projects beginning to rival traditional web companies for adoption. Consumer choice will be between centralised offerings, and their decentralised competitors. The last two years has been about the infrastructure needed to build these products, the next two will be about scaling and attracting users.”

 

2. Data shows a decline in ETH price likely isn’t the result of mass selling by ICO-funded blockchain start-ups

Contrary to popular wisdom, analysis shows the decline in the price of ETH isn’t the result of a rush by blockchain start-ups to sell Ether raised during ICO.   

  • The price of ETH declined steadily through 2018 from circa $1,200 in January to a low of $80 in December
  • However, a snapshot analysis of 40 prominent blockchain start-ups’ ICO wallets shows only modest selling of ETH. As late as September 2018 3.7% of the total supply of ETH remained locked-up in ICO wallets
  • On average, blockchain start-up ICO wallets continued to hold approximately 37% of tokens raised in ETH by the close of 2018.  

Joel John, Research Analyst, Outlier Ventures:

“Many in the community believed that ETH’s drastic decline was due to heavy selling pressure from start-ups selling ETH raised during ICO, but the numbers show otherwise. It’s more likely that ETH’s price simply declined with entire market, perhaps being oversold on the fear of a stalling ICO market.”

 

3. Enterprise blockchains saw significant growth in Q4 2018

Q4 analysis showed enterprise blockchain projects are continuing to gain traction in areas such as Blockchain-as-a-Service provision.   

  • Hyperledger, the open-source blockchain initiative hosted by the Linux Foundation, added Alibaba Cloud, Citibank, and Deutsche Telekom and 12 additional members in Q4
  • The Hyperledger blockchain was used to support the ‘Juncker Plan’ an initiative by the European Commission to transfer €360 million to Spanish SMEs
  • The ability of R3 to raise $150 million to further develop its Corda blockchain from Singapore’s Temasek demonstrated the willingness of more traditional investors to back enterprise offerings
  • Accenture deployed a custom procurement to pay solution for Thailand’s Siam Bank on R3’s Corda blockchain. The system tracks the sale of goods, collection of payments and registers financing.  

  

The recently published State of Blockchains Q4 report from Outlier Ventures can be downloaded here