Web3 gaming, DeFi maintain lead amid digital asset decline

As the market capitalization of digital currencies tanked, a new report highlighted the rise of Web3 gaming and decentralized finance (DeFi) projects in October.

• Web3 gaming and DeFi rising
• AI pulls global venture investments
• Metaverse market to reach $1.2T market value
• The rise of metaverse applications

According to DappRadar’s report, Web3 gaming accounted for 27.9% of all unique active wallets in the decentralized application (DApp) ecosystem. On-chain activity indicated that Web3 gaming’s market share spurred it to pull in over 4.5 million daily active wallets, representing a 1% increase from September.

Analysts at DappRadar noted that only Web3 gaming experienced growth month-over-month, with the report attributing the ecosystem’s success to innovation and improvements in customer experiences. The report underscored the steady rise of non-fungible tokens (NFTs) via evolving use cases, with the cohort reaching a trading volume of $546 million in October.

“Blockchain gaming continues to thrive, driven by the ability to keep users engaged through fresh experiences and consistent innovation,” read the report.

Meanwhile, DeFi dApps represented 18.4% of the ecosystem with projects like Pump.fun and Jupiter Exchange racking 4.29 million and 1.93 million UAW, respectively. Analysts disclosed that DeFi maintained its respectable rankings, driven in part by the ongoing momentum around stablecoins, yield-oriented protocols, and real-world assets.

The DeFi sector braved nearly a dozen hacks and exploits in October amid rising regulatory pressure from global authorities. DappRadar analysts disclosed that the combined effects triggered a slight decline in the sector’s total value locked (TVL) to $221 billion from September’s $235 billion.

DeFi’s decline came on the heels of the October 10 market crash that wiped over $20 billion in leverage positions across several protocols. Described as the largest market crash in the history of digital currencies, DeFi is staging a comeback, underscored by an uptick in user activity in early November.

A bird’s eye view revealed that AI DApps made up 14.2% while social protocols represented 4.8%. Emerging DApp sectors, including exchanges, gambling, governance, and infrastructure, accounted for an impressive 14.5% of total user activity.

AI pulls in nearly half of global VC funding

The DappRadar report noted that AI startups have cornered nearly half of global VC investment. The sector attracted 46% of global venture capital in Q3 2025, up 38% year-over-year, as governments and enterprises explored new use cases.

Several BTC miners have begun pivoting to AI infrastructure service providers to improve profitability, while Vietnamese authorities are turning to the technology for green transformation. Meanwhile, the Asia Pacific is doubling down on its AI push amid a global arms race marked by fast collaboration and attempts at regulatory guardrails.

Metaverse market to reach $1.2 trillion by 2030, buoyed by DLT and VR

While achieving a 40.4% compound annual growth rate (CAGR) in 10 years is not easy, analysts say the global metaverse market has several factors in play. The report highlighted the spike in AR and VR innovation since 2020 and its net effect in providing customers with immersive and interactive experiences.

Advancements in AI, haptic technology, and spatial computing since 2023 have significantly improved the realism and scalability of the metaverse market.

The report noted that blockchain elements like NFTs are contributing to the rise of the metaverse. Analysts at Allied Market Research disclosed that NFTs are now enabling digital ownership and secure transactions in metaverse ecosystems, opening new revenue creation opportunities.

In terms of application, the gaming segment is tipped to be the most significant use case of metaverse technologies by the end of the decade, continuing its lead from 2020. However, content creation and social media segments are expected to record the highest CAGR over the next five years.

Other notable applications include virtual training, digital commerce, entertainment, healthcare, and manufacturing, with sector players aiming to boost productivity and engagement metrics. The report noted that Alibaba Group (NASDAQ: BABA), Antier Solutions, ByteDance, Huawei, and Meta (NASDAQ: META) will remain industry leaders by 2030, with the possibility of a disruptor remaining slim.

By regional distribution, North America and Europe will hold the lion’s share of the market, backed by the presence of major technology companies and early adoption of emerging technologies. However, the Asia Pacific is billed to record the fastest growth, underscored by impressive smartphone penetration levels and strong gaming culture.

An influx of new players

Several players have dipped their feet into the metaverse, eyeing an array of enterprise use cases with the technology. Meta, the parent company of Instagram, is exploring advanced metaverse applications in fitness, training, and education, while others are discovering new use cases in manufacturing.

The technology has received the green light in education, with several Big Tech firms launching VR offerings to introduce new learning experiences for students. Despite the heightened interest, experts have raised concerns about data privacy, health, interoperability, and pricing in the pursuit of new immersive environments.

Watch: Omniscape’s Robert Rice looks at the state of the Metaverse