Blockchain App Development: Top Trends of 2024
Blockchain app development in 2024: which blockchain projects are developers flocking to, and what’s next for the industry?
Overall blockchain developer activity dropped in 2023 relative to the previous year – but with market sentiment improving and the Bitcoin halvening approaching, 2024 is the start of an exciting new era for blockchain builders and users alike.
Compared to on-chain transaction activity, blockchain developer activity is less precise and harder to track. However, we’ve compiled a few helpful resources that offer a snapshot of last year’s activity:
- According to Electric Capital, there was a 27% year-over-year drop in blockchain app development in last fall. However, this primary consisted of newcomers leaving, with both emerging and established developer volume continuing to grow (up 11% and 5% YoY respectively).
- Ethereum continues to attract the largest development and research community of any blockchain, and according to VanEck their overall share of active blockchain developers grew from 38% in August 2022 to 50% at the end of December 2023.
- Regarding areas of interest, the 600+ blockchain developers surveyed by Alchemy last year were mostly interested in smart contract security, account abstraction, and ZK-rollups.
With 2024 well underway, the crypto space has continued to expand and evolve, offering unprecedented opportunities in blockchain app development. Let’s explore the key trends as they unfold.
A Strong Focus on Blockchain Projects within DeFi
On-chain activity across multiple chains suggests that the majority of users now spend most of their time engaged in DeFi-related activities, unlike during the previous bull run. As a result, DeFi has taken the front seat in terms of blockchain app development, and we expect a significant surge in developer activity this year. With more blockchain projects rushing to offer sophisticated financial services to existing users, and more frictionless onramps and experiences for first-time users.
There is a lot to innovate on in today’s DeFi scene. The growth of liquid staking protocols in 2023 will enable staking yields to be embedded into a wider range of blockchain projects and DeFi offerings, such as interest-bearing stablecoins. On top of that, a rising tide of tokenized real-world assets (RWAs) is looming in the horizon, and sophisticated DeFi platforms such as derivatives DEXs will become an increasingly hot focus for developers looking to build the next big thing in DeFi.
Safer, Simpler Cross-Chain Crypto Tools
Crypto user data also shows that DeFi is currently the primary driver of cross-chain activity within the web3 ecosystem. While only a small fraction of today’s DeFi users are active on more than one chain, we exist this cohort to grow as L1 chains grow slower and more costly due to network congestion and new opportunities arise on more efficient L2 chains. This process will be greatly simplified over time as more developers focus on creating more seamless cross-chain experiences and address past security breaches.
During the last bull run, most L2 chains and L1 Ethereum competitors were either non-existent or in their infancy. These blockchain projects have matured significantly since then, and today’s environment encourages more creativity and exploration across the cross-chain space – both for blockchain developers and users. This focus on interoperability will increasingly reshape the way DeFi operates, as projects enable more fluid capital flow and access to a wider array of financial instruments and markets.
Frictionless UX & Key Management
This year, blockchain app development is witnessing a significant shift towards improving user experience (UX), addressing long-standing complexities that have hindered mainstream adoption. Traditional challenges like managing secret keys, interacting with clunky web3 protocols, and handling network transactions continue to overwhelm many new and existing users alike. Recognizing this, developers across multiple blockchain projects are working on a fresh set of tools aimed at simplifying web3 account management and ecosystem engagement.
The crypto space made significant advancements on this front last year, but most breakthroughs have not been widely adopted yet, including multi-party computation (MPC) for enhanced security and user interaction, smart accounts for easier account management, and embedded wallets for frictionless onboarding. Privacy-enhancing features will also be embedded within an increasing range of web3 platforms and services, given recent advances in zero-proof technology. As blockchain developers get to work, these features will not only be limited to crypto wallets – DeFi products will also likely employ account abstraction and AI-powered tools to turbocharge users’ yield farming strategies.
More Institutions Will Hire Blockchain Developers
Outside of native blockchain projects, developers will also find new and exciting opportunities building new platforms and tools for the burgeoning institutional crypto market. This year is set to be a milestone for institutional adoption, thanks to the growing maturity of existing blockchain infrastructures and improving public sentiment regarding crypto. There is a limited number of experienced blockchain developers on the market, and we expect institutional demand for technical talent to explode in 2024.
This shift in focus is also a response to expected headwinds in the world of traditional finance. While the future is uncertain, returns in traditional investments such as U.S. stocks are widely expected to decline in the coming months, which partially accounts for the growing interest among institutions in exploring blockchain app development. Developers are responding by innovating in the realm of institutional-grade crypto products, as more business look to create tailored solutions and 'walled-garden' environments that employ app-specific rollups, chains, and subnets.
2024 Will Be a Busy Year for Crypto Users AND Builders
Blockchain developers have their work cut out for them this year, whether they are advancing native blockchain projects or operating at the cross-section of DeFi and traditional finance. And as long as their applications live on a public blockchain, you can track their on-chain activity using an analytics platform like Flipside to make timely, data-based trading decisions.
If you’re interested in eventually becoming a blockchain developer, it’s helpful to first familiarize yourself with the crypto tools at your disposal and gain a more granular understanding of the chains and applications defining the space today.