May’s Increase in DeFi and NFTs May Signal the Beginning of a Recovery

In May, Bitcoin reached a new peak, sparking excitement across the cryptocurrency landscape and reinvigorating the decentralized application (dapp) sector.

Recent analyses indicate that May 2025 marked a significant moment for the dapp ecosystem, coinciding with a resurgence in the NFT marketplace.

Transformative Phase for the Dapp Landscape

During May, the dapp market experienced a wave of optimism, as the daily Unique Active Wallets (dUAW) increased by 8% to a total of 25 million, reflecting the favorable trends in the broader market. Significant growth was recorded in three main categories: AI dapps saw a 23% rise to 4.8 million dUAW, social dapps expanded by 21% to 4.3 million, and NFT dapps grew by 9% to 3.9 million.

These increases per sector highlight a rise in user engagement, leading to a more diversified dapp landscape, as noted in recent evaluations. Moreover, user activity among AI, DeFi, and gaming dapps became more interconnected, showcasing similar engagement levels across these domains, which points to a maturing market.

The DeFi sector also experienced robust growth, with the Total Value Locked (TVL) increasing by 25% to approximately $200 billion. This boost aligns with the general market upswing, propelled by Bitcoin’s record-high and a 40% increase in Ethereum’s price, which enhanced asset values and liquidity within the DeFi space.

Decentralized exchange Hyperliquid distinguished itself by achieving $244 billion in trading volume, claiming nearly 10% of Binance’s market share, despite facing backlash from industry insiders following its controversial handling of a market manipulation issue. This success placed Hyperliquid among the top five exchanges by trading volume, covering both centralized and decentralized platforms, and within the top ten by TVL across various blockchain networks.

NFT Market Recovers

At the same time, the NFT sector demonstrated revitalized activity in May, as trading volumes climbed 40% from the previous month to reach $280 million. The number of transactions rose by 35%, totaling 2.7 million. Although these metrics indicate improving momentum, experts caution against declaring a complete recovery just yet. Sustained growth in the upcoming months will be vital, but the recent upturn is a hopeful sign for the industry.

Ethereum reclaimed its position at the forefront of the NFT market in May, experiencing a 30% increase in trading volume and securing a 53% market share. Following Ethereum were Immutable zkEVM with 13% and Abstract with 10%. Abstract’s impressive 1200% rise can largely be attributed to speculative activities linked to potential farming benefits and upcoming airdrops.