Polygon's User Base in 2023 Nearly Rivals Ethereum's

In 2023, Polygon, a Layer-2 scaling network for Ethereum, nearly matched Ethereum’s crypto user acquisition, according to Flipside, a blockchain analytics firm. Polygon recorded an impressive 15.24 million acquired users, just about 160,000 users shy of Ethereum’s 15.4 million. Flipside defined an acquired user as someone who conducted at least two transactions on a specific blockchain, with at least one occurring in 2023.

Interestingly, Polygon led the user acquisition tally in the first half of 2023 but was eventually surpassed by Ethereum, which maintained its lead in the second half of the year.

Is the bull is really here? How can we tell?

Data.

Sentiment isn’t the only thing that’s changed lately. According to the data, user behavior is shifting — and with it, crypto markets.

We cover it all in The Onchain Crypto User Report 🧵📊👇 pic.twitter.com/IsclNOZhJk

— Flipside 📊 (@flipsidecrypto) January 25, 2024

Flipside highlighted Polygon’s strong start, noting, “Polygon kicked off the year with an impressive 2.8MM acquired users in January — accounting for over 40% of the network’s total acquired users in 2023.” Despite a consistent decline in monthly user acquisition, Polygon still outperformed many other networks. In comparison, Bitcoin secured the third position with 10.65 million acquired users, while Solana and Arbitrum rounded out the top five.

The combined acquired user count from the tracked blockchains, including Optimism, Avalanche, and Base, reached a substantial 62 million. Flipside observed that user acquisition reached its zenith in May, gradually tapering off thereafter. The surge in acquired users commenced in March, coinciding with the collapse of Silicon Valley Bank. This event potentially eroded confidence in centralized entities, prompting a shift towards decentralized custody alternatives, as noted by the firm.

Base, launched in August 2023, displayed a robust start but experienced a decline in user volume in the closing months of the year. Flipside attributed this tapering off to a resurgence of interest in more established chains towards the year-end. These networks offered more robust and diverse app ecosystems, potentially diverting attention from Base.

Flipside suggested that the next bullish market phase might favor Base’s user growth, especially considering Coinbase’s efforts to position itself as a crypto gateway for new users.