Two years ago, bitcoin dominated the cryptocurrency market, gobbling up 70% of its market value. But as crypto exploded to surpass $2 trillion in assets, the industry fragmented. Today, bitcoin’s share is less than 40%, and new crypto networks are popping up every day. One way to sift through the clutter and see where the industry is headed is to follow the software developers who build and maintain the cryptonets.
“Developers tend to be quite rational. If there’s something they can play with that has real utility, developers have that ability to go find that thing,” says Avichal Garg, managing partner at crypto-focused venture capital firm Electric Capital. . He views the number of developers working on a cryptonet “as a leading indicator of where value will be created and accrued over the next 10 years.”
Garg co-wrote a report with Electric Capital Partner Maria Shen revealing which cryptocurrency platforms attracted the most developers in 2021. They used data from GitHub, the go-to online repository where developers store their code, to estimate the number of engineers working on each platform. Their data underestimates the total number of developers because it does not capture the privately written code or the many engineers who work at companies like Coinbase.
Their research indicates that 18,000 active developers (including full-time and part-time contributors) are working on cryptocurrency platforms, up from around 10,000 a year ago. Garg views this increase as validation of the industry’s growth and longevity. Kinjal Shah, investor at Blockchain Capital, agrees: “When people vote with their feet and their time, it’s a strong signal that they are building something for the long term,” she says.
Electric Capital’s research analyzed nearly 500,000 code sets and 160 million code updates. It compared December 2020 to December 2021 to calculate growth. For the list below, a developer is considered full-time if they have done at least 10 software updates in a month.
The fastest growing platforms are all competitors of Ethereum, the second largest crypto network launched in 2015 which has 1,300 full-time developers building apps on it. Ethereum acts as a decentralized computer on which applications can be built, and it is maintained by over 5,000 “nodes” or computers that help validate transactions. The downside of being so widely distributed is that Ethereum can only process around 15 transactions per second (the Nasdaq stock market averages around 20,000 transactions per second), and one-time transaction fees can sometimes exceed $100. .
All of these fast-growing cryptonets take different approaches than Ethereum to decentralization and “consensus,” the algorithmic process of validating a transaction. They settle transactions faster and have lower fees, and most are not as widely decentralized as Ethereum.
Based in Korea Earth was founded by entrepreneur Do Kwon, 30, and launched four years ago. Its UST “stable coin” – a cryptocurrency pegged to the value of one US dollar – has rapidly risen to a market value of $10 billion, placing it among the top five stable coins in the world, according to the crypto data site. Messari. Based in San Francisco Solana surprised many crypto insiders over the past year by attracting hundreds of developers and vocal support from crypto billionaire Sam Bankman-Fried. A variety of apps built on Solana, ranging from crypto-trading exchanges and lending products to music apps, have become hugely popular. Solana’s SOL token rose from $1.85 in January 2021 to $170 by the end of the year, reaching a market value of $53 billion.
Close, a protocol founded in the Bay Area in 2017, was pioneered by Alexander Skidanov and Illia Polosukhin, two engineers who previously worked on the popular MemSQL distributed database system and Google’s TensorFlow machine learning platform. Solana and Near were built in Rust, a popular more widely used programming language than Solidity, on which Ethereum is based. Solana and Near have also been aggressive in offering grants to software developers if they agree to build applications on their respective systems. Close announcement an $800 million grant program in October, and former Circle CMO Marieke Flament became CEO of the Near Foundation this year.
One platform that has lost a significant number of developers is EOS, which has gone from around 125 total active developers (including full-time and part-time) in December 2020 to 80 a year later. In 2018, EOS held a $4 billion “initial coin offering” fundraiser and was subsequently a fine $24 million by the SEC for handling an unregistered security offering. The company neither admitted nor denied mischief.
In addition to the fastest growing networks, Electric Capital’s research shows which ones have the highest number of total developers. Ethereum has long held the top spot, and roughly one in four new crypto developers who entered the industry in the past year have chosen to build on Ethereum.
Update, 01/28/22: Electric Capital issued a correction to its report on 01/28/22. Flow was inadvertently overlooked in the ranking of the 10 fastest growing cryptocurrency ecosystems, but has been added. Algorand previously ranked tenth and was retired.