Messari: Interpretation of Stacks' Q2 performance in 2023, revenue increased by 105.5% over the same period

Original source: Messari

Despite pullbacks in some metrics, overall Stacks has performed fairly well in most categories year-to-date, with its dominance attributed to new features and strong BTC compatibility.

Both average daily transaction volume and average daily active addresses on Stacks declined in the second quarter. However, both indicators remain above their nadir in Q3 2022, with activity slowing after the increased use of Bitcoin Name Service (BNS) and Bitcoin Inscription in previous quarters.

STX’s circulating market capitalization fell 25.8% quarter-on-quarter, from $1.29 billion to $955 million, in contrast to the total market capitalization of the entire crypto market, which only increased by 0.4%. Despite the pullback in Q2, STX’s market capitalization is still up 53.3% year-to-date.

Revenue for Stacks hit $65,000 in the first quarter, largely because of the unusual period around the peak of prices. In the second quarter, revenue fell 35.5% year-over-year to $42,000, but was still up 105.5% year-over-year. Expect transactions to increase as more assets enter the ecosystem, as well as competition for users to drive growth in network revenue.

In Q2, the Stacks ecosystem metrics continued to grow year-over-year, and the market cap/total value locked (TVL) ratio declined, indicating a larger ecosystem relative to token size. Daily contract calls and NFT activity on Stacks declined in Q2, reaching yearly lows.

The community activities and developments worthy of attention on Stacks include the 2023 BTC Miami (Bitcoin Miami) conference, the release of core projects such as sBTC and Nakamoto, and the beta release of the stablecoin protocol UWUProtocol. Stacks has also encountered MEV issues related to BTC miners, but has been working on a solution.