The strong rise of AI agent applications, RWA and gaming drive the transformation of the NFT market

In the second quarter of 2025, the decentralized application ( DApp ) market is showing new development trends. Although the number of daily active unique wallets has slightly decreased, AI and social applications have performed impressively. The total locked value in DeFi has significantly increased, but the amount of financing has dropped sharply. In the NFT sector, there is an interesting phenomenon where sales have surged but transaction volumes have decreased, reflecting a shift in market focus from ostentatious consumption to practical value. However, security issues remain a major hidden danger for industry development.

Main Trends

1. The number of daily active unique wallets for DApps remains stable at around 24.3 million, a month-on-month decrease of 2.5%. The growth in AI and social sectors is significant, while the activity in DeFi and GameFi has declined.

2. The total value locked in DeFi has risen to $200 billion, a 28% increase month-on-month. However, the financing amount in the DeFi sector has decreased by 50% quarter-on-quarter, totaling only $483 million.

3. NFT trading volume decreased by 45% to $867 million, but sales surged by 78% to 14.9 million transactions. RWA NFTs and gaming NFTs have become the new favorites in the market.

4. The Web3 industry lost $6.3 billion due to security incidents, an increase of 215% compared to the previous period. The Mantra incident alone resulted in a loss of $5.5 billion.

Changes in the DApp Ecosystem

AI application Virtuals Protocol has become the DApp with the highest number of daily active independent wallets. The activity level of DeFi and GameFi has declined, while Social and AI applications are growing rapidly. The InfoFi concept has emerged, with platforms like Kaito and Cookie DAO performing exceptionally well.

The dormant DApp data shows that the inactivity of AI applications has surged by 129%, reflecting that projects in this field are still in the early stages of development and face challenges in funding and user retention.

DeFi Industry Trends

Ethereum still accounts for 62% of the total TVL in DeFi, with Solana in second place. Hyperliquid L1 has performed exceptionally well, with TVL soaring by 547%. Despite the overall decline in funding, it still shows sustained interest in the DeFi sector.

NFT Market Transformation

RWA and gaming NFTs are leading market changes. The trading volume of personal avatar NFTs has significantly declined, while the trading volume of RWA NFTs has jumped to second place. Domain NFTs have regained attention, especially within the TON ecosystem.

The game NFT collection Guild of Guardians has topped the quarterly trading volume, surpassing traditional blue-chip projects. The Courtyard platform has rapidly emerged as the second-largest NFT trading platform, highlighting the impact of the RWA narrative in the NFT space.

Security Incident Analysis

In the second quarter, losses caused by vulnerability attacks surged, marking one of the most severe quarterly losses since the FTX incident. The Mantra insider sell-off resulted in a loss of $5.5 billion, accounting for 87% of the total losses. Other significant events included the theft of personal user private keys and the hacking of the Cetus Protocol.

These events have exposed the ongoing challenges in security within the industry, calling for developers, investors, and users to remain vigilant and enhance security awareness.

Conclusion

In the second quarter of 2025, the DApp market will show trends of consolidation and transformation. AI and social applications are rising, NFTs are shifting towards practical value, and DeFi maintains a core position but faces financial pressures. Security issues remain a major obstacle to industry development. In the future, DApps need to seek a balance between attractiveness, security, sustainability, and value creation.