Blockchain developer market becomes more centralized post-FTX, data shows

According to Electric Capital’s research report, the blockchain developer ecosystem is changing: fewer developers are entering the space and experienced developers are dominating the business.

Blockchain developers are key to the crypto industry. They develop applications and tools that engage users and create value. More users bring more developers, thus creating a cycle of growth. However, despite crypto’s focus on centralization, the developer market appears to be becoming more centralized, with experienced developers taking the lead, according to Electric Capital’s latest research report.

Less active developer

The total number of active blockchain developers has dropped sharply. There were over 31,000 active developers in November 2022. By November 2024, that number had fallen to 23,160, a 25% drop in two years.

Total monthly active developers | Source: Electric Capital

Part-time developers were hit the hardest. Their numbers dropped from 16,600 in November 2022 to 12,386 in November 2024. Newcomer developers have also seen a sharp decline: in November 2022 there were 18,547 newcomers, two years later that number had fallen by more than half to just 8,986.

In contrast, established developers (those with two years or more of experience) are thriving. There were 6,903 resident developers during the same period, a 65% increase to 11,400 in just two years.

Andrew Morfill, CIO of Zodia Custody, an institutional-first digital asset custodian backed by Standard Chartered, says the decline in part-time and new blockchain developers “is likely attributable to factors such as market volatility and/or increased complexity due to the market.” maturation.”

“This complexity requires a deeper understanding of the technology, which can be intimidating for newcomers. At the same time, this trend shows that developers already in the market are and remain committed. The same is seen with enterprise customers, where the number of those already in the market has doubled; new entrants are on the sidelines, with the tipping point for the next wave of adoption not yet fully realized.”

Andrew Morfill speaks to crypto.news

Morfill predicts the current decline will “probably reverse in the first half of 2025,” citing developer activity generally lagging broader market price trends. He also noted that fewer new developers may “slow the flow of new ideas and different perspectives,” but that the continued presence of experienced developers can foster an environment where “newcomers and part-timers have strong mentors and solid frameworks on which to build.”

Meanwhile, Francesco Andreolí, head of the Consensys developer community, attributed the decline in part-time and new developers to the “increasing technical demands of blockchain projects,” which Andreolí claimed “often require specialized knowledge and ongoing commitment.”

“To counter this, more training, mentoring and startup-friendly tools are needed to attract the next wave of web3 talent and make the maturing industry more accessible. Striking a balance between leveraging experienced developers and encouraging new talent is key.”

Francesco Andreolí in conversation with crypto.news

Andreolí also emphasized the importance of ecosystem maturity and accessibility in blockchain development, noting that while blockchain development tools are evolving, they often “lack the polish and simplicity of more mature ecosystems,” making it difficult for part-time developers to contribute. effectively. To address this issue, Andreolí stated: “We create pre-built environments such as CLIs to make it easier for new developers to onboard and recreate optimal web2 developer experiences, thus lowering barriers to entry.”

The head of the Consensys developer community also stressed the need to combat the perception of exclusivity in blockchain development, saying it could “alienate newcomers, especially those without a deep technical background.” He advocated promoting inclusivity and creating tools that “democratize access to blockchain development,” emphasizing that these steps are vital to nurturing the innovation and diversity necessary for the long-term growth of the industry.

Experienced developers gain share

Electric Capital’s “2024 Developer Report,” which analyzed 902 million code commits across 1.7 million repositories, shows the growing influence of experienced developers.

The report notes that established developers (those who have been in crypto for 2+ years) are at all-time highs, growing 27% year-on-year and delivering 70% of code commits.

Active developers by tenure | Source: Electric Capital

This means that while the overall number of developers is falling, experienced developers are taking a larger share of the work. The report also revealed that 39,148 new developers will explore crypto in 2024; But this growth among newcomers is not enough to offset the loss of part-time developers and those leaving the industry.

Andreolí warned that this shift could centralize influence among a small group of contributors and create risks for the ecosystem.

“The fragmentation of ecosystems, with developers needing different skills such as Rust for some chains and Solidity for others, creates additional barriers to collaboration and broader participation.”

Francesco Andreali

Andreolí also expressed concerns about the potential for “homogenization of innovation”, stating that over-reliance on experienced developers “can lead to solutions shaped by established paradigms, potentially stifling creativity from new entrants and diverse backgrounds.” This, he suggested, could stifle the creativity that newcomers and individuals from diverse backgrounds often bring.

To alleviate these challenges, Andreolí underlined the importance of encouraging cross-chain collaboration through open source projects, community-driven governance, and tools that encourage permissionless innovation, emphasizing that such efforts “mobilize developers within communities, enabling them to become an integral part.” of the developer experience.”

At the same time, Morfill believes that the increasing dominance of experienced developers is “a natural sign of the maturation of the industry”, adding: “Decentralized development is somewhat of a myth, given the small number of people running some units.” The core of the web3 and DeFi ecosystem.”

“Projects like Solana provide an excellent gateway to the next wave of adoption for projects and institutions as well as developers; ecosystems built around core assets, projects and protocols will be key in 2025. This also means cross-chain capability and interoperability “It’s coming too.” It will feature heavily and become very important for projects and organizations looking to scale.

Andrew Morfill

Where developers live

Blockchain development is global. Asia now leads in developer share. North America, once the top region, has fallen to third place. The US remains the top country for blockchain developers, with a global share of 18.8%, despite a huge decline from 38% in 2015.

Breakdown by genre | Source: Electric Capital

India emerges as a leader. In 2024, the country added the most new developers, accounting for 11.7% of the global share. Other countries with significant developer bases include the United Kingdom (4.3%), China (4%) and Canada (3.8%).

Developers are diversifying across chains

Developers are working on the blockchain ecosystem more than ever before. In 2015, less than 10% of developers were working on more than one chain. However, by 2024, one in three developers now works on more than one chain.

Data shows that Ethereum (ETH) remains the largest ecosystem in terms of total developer activity. However, Solana (SOL) is attracting more new developers as it grows its developer base by 83% in 2024, making it the best ecosystem for newcomers. Meanwhile, Bitcoin (BTC) development remains steady, with 42% of developers working on scaling solutions.

Expand use cases

Different blockchains attract developers based on specific use cases:

Ethereum: Leads in total developer activity and remains a hub for decentralized finance. Solana: Dominates decentralized exchange usage and is a leader in low-fee usage areas such as NFT/meme coin minting (64%). Coinbase Base: Responsible for 42% of “new code written in the Ethereum ecosystem” and has 97% of NFT mint volume.

Stablecoins and restaking are also among the growing sectors. Stablecoins currently have over $195 billion in circulating supply and over $80 billion in daily trading volume. The report shows that the restaking industry, led by projects like EigenLayer, will increase the number of full-time developers by 130% in 2024.

What does this mean for space?

Although the shift towards experienced developers shows that the industry is maturing, it also raises concerns about centralization. As newcomers decline and established developers dominate, the industry may become less diverse.

This trend also reflects broader market challenges. The 7% decline in total developers in 2024 suggests that some are leaving due to market uncertainty or fewer opportunities, especially after the severe hit brought by the FTX crash. The ripple effects of bankruptcy continue to impact the industry even today.

Electric Capital’s report identifies developers as the “leading indicator of value creation” and highlights that a decline in developer engagement could hinder blockchain innovation over time.