2025 Q2 Dapp Market Report: AI Agent Applications Dominate, RWA and Gaming Drive NFT Revival

Original Title: State of the Dapp Industry Q2 2025

Original Author: Sara Gherghelas, DappRadar

Original Compiler: Tim, PANews

AI agents top the market, RWA redefines NFT value, DeFi attracts funds but loses momentum, and the $6.3 billion in hacker attacks in the second quarter exposes the industry's vulnerabilities.

Despite the rebound in cryptocurrency market prices and improved sentiment, the DApp ecosystem presents a different picture: AI agents are experiencing explosive growth, the value of NFTs is shifting from ostentation to functionality, and DeFi is navigating between rising TVL and shrinking financing. These data not only showcase market activity but also reveal the true direction of users, lagging sectors, and key trends reshaping the future of DApps.

The era we are in no longer allows market trends to be driven solely by hype. Users are beginning to pursue real value: whether it's AI agents that can accomplish tasks, NFTs linked to RWA, or DeFi platforms that offer sustainable returns. However, risks remain high: losses from exploits are sharply rising, highlighting the fragility of trust, where even minor oversights can be exploited by malicious actors.

This report delves into the changes in the industry landscape, providing a comprehensive analysis of data dynamics in DeFi, NFTs, gaming, AI, and more. From wallet activity and transaction volume to application and capital flow, we track key signals and focus on the core narratives shaping the cryptocurrency industry in Q2 2025.

Key Points:

• In Q2 2025, the average daily active unique wallets for DApps was 24.3 million, a decrease of 2.5% quarter-on-quarter, but still a staggering 247% increase compared to early 2024.
• The total locked value in DeFi reached $200 billion, a quarter-on-quarter increase of 28%, mainly benefiting from a 36% rebound in Ethereum. However, financing in the DeFi sector fell by 50% quarter-on-quarter, with only $483 million raised in Q2, bringing the total financing for the first two quarters of 2025 to $1.4 billion.
• NFT transaction volume plummeted by 45% to $867 million, but sales surged by 78% to 14.9 million, reflecting a sharp drop in average market prices, while the number of traders increased by 20%.
• RWA NFT transaction volume grew by 29%, ranking second in the sector, with the Courtyard platform becoming the second-largest NFT market by transaction volume this quarter.
• Guild of Guardians NFT transaction volume soared to first and fourth places, surpassing BAYC and CryptoPunks, marking a pivotal moment for gaming NFTs.
• Web3 suffered $6.3 billion in losses due to security incidents, a quarter-on-quarter increase of 215%. The Mantra exploit alone accounted for a loss of $5.5 billion, making it the second-largest security incident in the crypto industry since the $8 billion loss from the FTX bankruptcy in 2022.

1. Dapp Daily Active Unique Wallets Stabilize at 24 Million, Significant Growth in AI and Social Sectors

This quarter, DApp activity decreased by 2.5%, with an average of 24.3 million daily active unique wallets. Nevertheless, we can still consider the ecosystem stable at this level, which is both a sign of the industry's increasing maturity and proof that users are continuously interacting with DApps across multiple application areas. It is worth noting that many users operate multiple wallets, so the number of daily active unique wallets may differ from the actual number of users. However, this metric remains a strong indicator of user engagement. Just a few quarters ago, the number of daily active unique wallets was around 5 million, showing a significant growth trajectory.

The number of active wallets in DeFi and GameFi both saw declines, with DeFi down by 33% and GameFi down by 17%. On the other hand, Social and AI DApps experienced growth, aligning with broader industry trends.

In the Social sector, the rise of InfoFi is noteworthy, with platforms like Kaito and Cookie DAO leading the way. In the AI sector, agent-based DApps showed strong momentum, with Virtuals Protocol standing out.

As expected, these sector-level shifts also impacted the distribution of dominance. The decline in activity in DeFi and Gaming sectors led to a reduction in their market share, while the AI and Social sectors captured and expanded more share. Comparing Q2 2025 with Q1, it is evident that the AI sector is rapidly rising, with the Social sector closely following. I believe that by the end of this year, it would not be surprising if AI surpasses either Gaming or DeFi in dominance.

In fact, looking at the top DApps by unique wallet count this quarter, there is one AI DApp at the top.

The remaining spots on this list are occupied by several well-known projects, primarily from the DeFi sector. Given that these projects have maintained stable operations amid the Meme coin craze and Agent token frenzy, such distribution is understandable.

Additionally, another noteworthy perspective is that this quarter we introduced the "Dormant DApp" metric, specifically tracking those decentralized applications that were active in Q1 2025 but completely ceased activity in Q2.

We focused on several major categories for analysis: the number of inactive decentralized applications in the DeFi sector increased by 2%, gaming increased by 9%, and NFT applications rose by 10%. This analysis particularly included high-risk applications, whose inactivity actually decreased by 40%, indicating that they are still in use and rarely abandoned. However, the most surprising finding was in the AI sector, where inactive AI applications surged by 129%. While this percentage seems astonishing, it corresponds to only 16 applications. Nevertheless, this phenomenon raises important considerations: it highlights that these projects (especially in gaming and AI) are still in their early development stages, and without sufficient funding support, achieving mainstream application is incredibly challenging. In the Web3 space, user retention remains the most daunting challenge, and these data undoubtedly confirm this.

2. Total Locked Value in DeFi Soars to $200 Billion in Q2 2025, but Financing Plummets by 50%

The macroeconomic environment this quarter has been like a roller coaster, and the DeFi sector has not been able to remain unscathed in this turmoil. Nevertheless, the market still shows positive signals: first, the cryptocurrency market prices rebounded strongly, with Bitcoin up 30% compared to Q1 2025, Ethereum climbing 36%, and the total market capitalization of cryptocurrencies increasing by 25%. Naturally, the DeFi sector followed this upward trend, with total locked value surpassing $200 billion, achieving a quarter-on-quarter increase of 28%.

Observing the total locked value performance across major blockchains, most chains recorded steady growth, with only Tron showing a decline of 8%. In terms of market share, Ethereum still holds a dominant position with an absolute advantage, accounting for 62% of the total TVL in the DeFi sector, followed by Solana with a 10% share.

The standout this quarter is Hyperliquid L1, whose TVL skyrocketed by 547%. This high-performance Layer 1 blockchain is designed for on-chain perpetual contracts and spot trading, utilizing a HyperBFT consensus model inspired by HotStuff.

We also researched the most active DeFi decentralized applications in Q2 2025, providing an in-depth analysis of the current areas with the highest user engagement.

Ultimately, we analyzed the investments flowing into the DeFi sector this quarter. The sector raised a total of $483 million, a 50% decrease compared to Q1. So far in 2025, DeFi projects have secured approximately $1.4 billion in financing. While this figure indicates a slowdown compared to the explosive growth seen in previous cycles, it still demonstrates stable interest from capital in the sector and may suggest a more mature direction for capital allocation. Let's see how the trends develop for the rest of the year, but for now, it seems the trend is stabilizing.

3. NFT Sales Surge by 78%, but Transaction Volume Declines: RWA and Gaming Lead Market Shift

We all hope for a recovery in the NFT market, and while overall attention remains, some core data is still not optimistic. This quarter, NFT transaction volume plummeted by 45%, but transaction volume grew by 78%. This confirms a long-observed trend: NFTs are becoming increasingly affordable, but market enthusiasm has not waned; instead, it has shifted in nature.

To better understand the reasons behind this shift, we sorted the NFT categories with the highest transaction volume this quarter, revealing an interesting phenomenon: new narratives are emerging, while old narrative patterns are making a comeback.

Data shows that personal avatar NFTs suffered a severe blow, plummeting by 72%. In contrast, real-world asset (RWA) NFTs surged to second place in transaction volume with a 29% increase. Art NFTs saw a 51% decrease in transaction volume, but their transaction volume soared by 400%, indicating that art prices have dropped significantly, making art NFTs more accessible to average buyers.

A recently returning trend is domain NFTs, which have seen both transaction volume and sales increase. This growth is primarily driven by the TON blockchain ecosystem, as Telegram users rush to purchase anonymous domain names based on digital numbers. These domain names can be linked to Telegram accounts without needing a SIM card, clearly catering to a specific demand.

Having identified which categories are trending, we then focused on the number of traders to determine whether market participants are continuing to grow or are returning.

This quarter, the average monthly NFT traders reached 668,598, a 20% increase from 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 the significant drop in transaction volume, OpenSea remains the leader. However, its sales volume has risen in tandem with the Courtyard platform. This surge for OpenSea is closely related to the news of its upcoming SEA token launch. This airdrop will target both long-time users and those currently active on the updated version of the platform. As a result, many users are actively trading low-priced NFT collectibles to accumulate points, attempting to maximize future reward gains, a classic move seen in other airdrop activities.

Meanwhile, the Courtyard platform has quickly risen to become the second-largest in the industry. This clearly indicates that the RWA narrative is not only gaining traction in the DeFi sector but is also making waves in the NFT space. Frankly, this development is encouraging. The tokenization of physical assets could very well be a key catalyst in pushing NFTs into the mainstream spotlight.

We also investigated which product series dominated in Q2 2025, and the data revealed an unexpected shift.

After a considerable period (possibly years), a gaming NFT collection topped the quarterly transaction volume rankings for the first time. Guild of Guardians not only made it into the top five but also secured two spots, surpassing blue-chip projects like CryptoPunks and Bored Apes. This confirms the overall trend we have observed: the activity in the NFT market in Q2 was primarily driven by RWA and gaming assets. Now, we finally have data to support this assertion.

4. Q2 Sees $6.3 Billion in Losses Due to Exploit Attacks, One of the Worst Quarters Since the FTX Collapse

We had hoped that after so many years, the entire industry would have learned lessons and remained vigilant, treating user funds more cautiously and achieving at least a certain level of mature development. Unfortunately, the reality this quarter is quite the opposite. In Q2 2025, the Web3 sector suffered $6.3 billion in losses due to hacker attacks and security vulnerabilities, a 215% increase from the previous quarter, marking one of the heaviest loss records since the FTX collapse.

If there is a glimmer of hope, albeit extremely faint, it is that 87% of the losses came from a single event: the Mantra collapse. From certain perspectives, this might be a positive sign: there were only 31 security incidents throughout the year, which is not many; it is just the severity of a single case that inflated the overall losses. That said, it raises the question: are we truly building safer and more reliable products, or are we merely relying on luck to avoid disaster?

To elaborate, the top five incidents this quarter are as follows:

• Mantra Insider Selling Incident (April 13, 2025): The price of Mantra's token OM plummeted over 90%, evaporating a market cap of $5.5 billion. This incident was confirmed to be caused by coordinated selling by insiders, rather than a technical vulnerability in the smart contract.
• Individual User Private Key Theft Incident (April 28, 2025): Due to a social engineering attack, an individual user's crypto wallet was stolen, losing 3,520 Bitcoins (approximately $330.7 million).
• Cetus Protocol Hacking Incident (May 22, 2025): The mainstream DEX of the Sui ecosystem was attacked, with $260 million stolen, causing the platform's token price to plummet by over 90%, and smart contract activities were forced to pause.
• Nobitex Exchange Hacking Incident (June 18, 2025): The Iranian crypto exchange Nobitex was hacked, resulting in losses exceeding $82 million. The pro-Israel hacker group Gonjeshke Darande claimed responsibility for the attack and threatened to leak the platform's internal code and user data.
• UPCX Protocol Vulnerability Incident on April 1, 2025: Attackers infiltrated the ProxyAdmin smart contract, executed unauthorized upgrades, and abused administrative privileges to drain funds from three management accounts in three transactions, stealing a total of 18.4 million UPC (approximately $70 million).

This is truly disheartening. It makes one question how much progress we have actually made. Yet, at the same time, we know that many projects are actively advancing more robust security infrastructures, audits, and emergency response plans.

As developers, investors, and users, the most we can do is to remain security-conscious, informed, and cautious in our actions.

Utilize tools like DappRadar to verify the projects you interact with. While this is not always foolproof, it is a good starting point.

5. Conclusion

As Q2 2025 comes to a close, DApps are clearly entering a new phase, marked by integration and transformation. Although overall activity (referring to the number of daily active wallets) remains stable at around 24 million, we are witnessing a significant shift in user behavior and the dominant sectors of the industry. Driven by emerging narratives such as InfoFi and the AI agent economy, AI and social DApps are accelerating their rise. The NFT sector is also undergoing transformation, with RWA and gaming assets taking the lead, indicating a directional shift from speculative hype to practical value.

Even as capital cools, DeFi maintains its core pillar status with strong total locked value growth and price recovery. However, the surge in losses due to exploits serves as a stark reminder to the industry: the development frenzy without reliable security measures may hinder its progress.

It is evident that users have not left the space; they have simply chosen different ways to engage. The current challenge lies in building DApps that are not only attractive but also ensure security, sustainability, and create real value. We will closely monitor these future developments and continue to provide in-depth reporting.

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