I’ve decided to break down some of the data points and graphs a bit further.
I’ve been in the digital marketing world for about 12 yrs now and have worked with countless developers on hundreds of different projects. I’ve worked with great developers and not-so-great developers and have developed (pun intended?) a sixth sense of how to spot quality work.
Additionally, I’ve seen firsthand how developers impact whether or not a project succeeds or not.
Why does developer activity matter?
Because it signals where all the innovation, disruption, and mass adoption will come from in the future of Web3. Finding good developers can be challenging, and it takes time for them to get proficient at writing code for a specific ecosystem.
Keeping great developers is even more challenging. If you don’t have a sandbox, they can break stuff in, they will go elsewhere where they feel like they can make an impact.
Of course, financial incentive also helps, and the chain with the most active developers and upside remains Ethereum. However, other chains are gaining ground, but they sure have a lot of catching up to do.
Because everything is open source, Electric Capital was able to “fingerprint 500K code repositories, and 160 million code commits to creating their annual report.”
If you want to skip the read you can also check out my thread that highlights why Ethereum is the center of the Web3 Universe because of developer activity.
Developers in Web3
18,416 monthly active developers are now in Web3, which is a 104% increase from when it trended sideways from 2018 - 2021. Nice influx but still low (more on that later) when compared to other programming languages. The more developers in Web3, the more tools they can build to decentralize away from big corporations and governments.
Innovation compounds like money and eventually hits an exponential growth curve. I guess this is what they call hockey stick growth which Web3 hasn’t hit yet.
No surprise here – Monthly active developers increase when price increases. In fact, all activity increases in Web3 when the price increases. Read this if you want to understand how organic marketing works in Web3. People bash speculators, but they are the organic marketers of Web3. Hype cycles bring more builders into the ecosystem as speculators lose money and disappear until it starts all over again.
Most developers in Web3 are part-time, but full-time developers are increasing. This is important. It takes time to become great at a programming language. So part-time devs won’t ever be as good as full-time dev.
However, part-time devs could be incentivized to become full-time devs in the future, which will grow the ecosystem.
More Devs joined in 2021 than any year which is fitting for the biggest bull run in history. Bear markets are for building, and as we hit a bear market, those developers will go heads down and build cool shit for the next bull run.
The ETH killers have a lot of catching up as Ethereum commands the most monthly active developers. Remember, innovation compounds like money.
700+ new developers join Ethereum every month, which is an all-time high. That’s more than any other chain in the Electric Capital report.
Ethereum is the center of the Web3 universe, with 20% - 25% of all new developers going through their ecosystem. If they leave and go to other chains, they take the Ethereum mindset.
Ethereum keeps its developers around. Remember what I said above about keeping great devs? Their dApps have sparked more mass-adoption than any other chain. Even when developers leave Ethereum, they seem to spin up copies of what was built on the Ethereum blockchain.
Polkadot is the next largest ecosystem, but Ethereum still has a massive head start. After that, it’s Bitcoin, Cosmos, and Solana.
Fantom is the fastest growing total monthly developer ecosystem, with Terra commanding the most full-time monthly developers. Solana, the centralized VC chain, is number 2 on both lists.
DeFi, which trades at less than 1% of global banks, grew its developers by 76% to 2,571 total! I expect DeFi to be at 5% - 10% of the MC of global banks in the next 5 yrs. Their protocols are too fast and efficient for them not to. Of course, regulation is worrisome, but with more pro-crypto politicians, I don’t expect anything too harsh on that front.
After staying relatively flat for 3 years, 2021 spiked in a big way! This will always happen during bull runs. If we’re in a bear market, we will trend sideways for the next few years.
Even with all those new developers, the entire Web3 ecosystem is dwarfed by the army of programmers in the Amazon ecosystem. Look at the growth of Amazon as a comparison of what we can expect out of Web3 over the next 10 years.
Exciting, isn’t it?
Web3 is still so tiny when compared to all the developers. For example, there are only 18,416 Web3 developers compared to 26,900,00 total!
That signals lots of upsides when it comes to growth.
It’s important to note there are probably more Web3 developers than this report hints at. This only counts all the open-source developers working on projects. It’s reasonable to think that there are thousands of others working on closed source projects.
Developers are signals to what the upside of each chain is. Ethereum still reigns supreme in total developers, developers joining the ecosystem every month, and developer retention.
It takes a long time to become a great developer – Often 4 - 5 yrs. There is a lot of Ethereum killer talk, but it will be hard for any chain to flip Ethereum developer numbers. The more developers work in an ecosystem, the more innovation compounds like money.
Remember, everything we pay around within Web3 came from Ethereum. 20% - 25% of all developers go through Ethereum to interact with Web3. Even if they leave, they will undoubtedly take Ethereums mindset and methodologies with them.