Electric Capital: Taking Stock of the Cryptocurrency Landscape in 2025

Reprinted from chaincatcher
01/25/2025·3MWritten by: Stanford Blockchain Club
Compiled by: Vernacular Blockchain
Every year, Electric Capital publishes the Annual Developer Report, which attracts thousands of readers seeking insights into crypto developer activity across various ecosystems. This year's report analyzed more than 902 million code commits across 1.7 million code bases.
The first version of the report began in 2018. Since then, Electric Capital has released as scheduled every year because they believe—and I agree—that developer engagement is the most important metric for the future of the crypto industry. We need developers to create applications that bring value to users, thereby attracting users, and thus attracting more developers to the ecosystem.
Avichal Garg and Maria Shen are core members of Electric Capital, serving as co-founder and managing partner and investment partner respectively. They focus on innovation in the blockchain and encryption ecosystem, promote the development of the encryption industry by supporting the developer community and investing in key projects (such as EigenLayer and Monad), and have deep insights in the developer ecosystem, NFT and DeFi fields.
During our interview, I asked Avichal and Maria the following questions and summarized their insights.
**1. Can you briefly introduce yourself and share how you entered the
encryption industry?**
Maria
Maria was initially drawn to crypto for its cross-border payment solutions, but didn’t dive into the space until Ethereum was released. She was interested in programmable money because she thought it could solve the problems she faced at her supply chain startup. Specifically, she hopes to use Ethereum to create a lightweight and cheap hosting system. However, in 2016, she discovered that the infrastructure at the time was not yet ready for real-world use cases, but this exploration led her deep into the “rabbit hole of the crypto world” and realized the potential of this technology, although it was still immature at the time.
Avichal
Avichal first came into contact with cryptocurrencies in 2010-2011, when he was running his second startup Spool, which focused on mobile content caching for offline reading. During this time, he and co-founder Curtis met several Bitcoin miners and considered mining. After selling Spool to Facebook in 2012, Avichal continued to stay in the field as a hobby.
His involvement deepened during the 2017 Bitcoin bull run. He conducts in-depth research on Bitcoin, Ethereum, and ICOs, and conducts educational sessions for curious venture capitalists. By 2018, recognizing that traditional venture capital firms had insufficient knowledge about crypto assets, several venture capitalists invited Avichal to manage their crypto investments.
Avichal’s background in distributed systems and security naturally led him to explore privacy-preserving technologies in the blockchain space. His interest in cryptographic privacy stems from the unique challenges of blockchain technology, particularly in the areas of custody and security.
**2. The report mentioned that although the number of new developers has
reached a record high, experienced developers still contribute 70% of the code. What does this say about the maturity of the crypto space?**
Maria
The field is now more open and easier to enter than in the early days, and the options are more diverse. Unlike in the early years when there were only Bitcoin and Ethereum, the cost of experimentation was very high. Now, developers can easily build on the new chain, thanks to rich documentation and a supportive community of mentors. However, there is attrition among novice developers. Although the entry barrier is lower than before, to truly invest in this field requires developers to complete an important thinking change from the traditional development model. Once this initial hurdle is overcome, developer retention improves significantly. This dynamic also explains why experienced developers still dominate the vast majority of code contributions.
**3. Asia has surpassed North America to become the leading region for
crypto developers. How does this impact your investment philosophy?**
Maria
In 2024, the fastest growing region for new developers in the crypto space will be India. However, we are also seeing an increase in developer activity from regions such as Nigeria and Southeast Asia. I’ve talked to some developers from these regions who started with cryptocurrencies and stablecoins and then decided to build better applications for them because they knew best how to improve the product for their needs.
Avichal
Related to this phenomenon, Avichal mentioned, is that building core infrastructure requires larger development teams and funding. But Asian and African countries often have relatively little access to technical expertise and finance, exacerbating the divide.
**4. One-third of developers are now developing on multiple blockchains,
with the EVM chain leading this trend. With the rise of ecosystems like Base and Solana, how do you see this multi-chain concept developing?**
Avichal
Each chain has its own unique positioning. Ethereum is used for high-value, high-security operations, while Solana and Base are used more for applications that focus on speed and cost, such as NFT minting and gaming. These chains offer faster speeds and lower costs than Ethereum, so as long as there is community support and cost advantages, most activities will tend to be conducted on these chains.
The rise of Solana and Base. Solana is the leading ecosystem for attracting new developers in 2024, with its high-performance architecture and expanding ecosystem attracting a large number of developers. Another key player is Base. Base has EVM compatibility and is supported by Coinbase, making it easy for Ethereum developers to migrate applications. In 2024, Base has become the most popular chain among multi-chain deployers, accounting for 25% of the original on-chain code logic among all EVM chains.
**5. You mentioned that the application of NFT has gone beyond artworks.
What examples are you paying attention to?**
Maria
NFTs and blockchain ledgers enable precise assignment of ownership. One example is BasePaint, a Base-based cryptographic collaborative art project where artists work together to create digital art on a shared pixel canvas. After each 24-hour creation period, the work is converted into an open version NFT, and 90% of the proceeds are distributed to participants in proportion to the number of pixels contributed by the artist. The process of intellectual property rights on the chain is very clear, and digital contributions are combined with smart contract governance benefits to ensure that everyone can receive reasonable returns based on their contribution.
To view the BasePaint project, please visit: https://basepaint.xyz/.
Avichal
In blockchain, things are either homogeneous or non-homogeneous. While most things are non-fungible – they are unique and irreplaceable, these are NFTs, their digital representation on the blockchain.
One of the first applications of NFTs was PFP (Personal Profile Picture), which communicated social signals to others by displaying a high-value NFT (such as an NFT worth $100,000) or by being an early adopter. This behavior is essentially a signal of "social adaptability." As primates, humans have a deep-seated desire and need to communicate resilience to one another. In a digital realm where people are online more than 12 hours a day, this signaling occurs primarily through digital scarce commodities. For example, in a Zoom video conference, most people won't care what shoes you wear, but you might care because you like shoes or crafts. But the reason many people buy expensive shoes is so they can be seen. In such an environment, what you wear "above the shoulders" is most important.
NFT is the natural mechanism for human beings to transmit social signals in the digital world. Something cryptographically verifies its scarcity, that scarcity drives value, and that value drives social signaling. Instead of buying expensive shoes, watches or bags, people will buy expensive digital goods.
It reminds me of the early days of the internet, when time spent had shifted online but advertising dollars were still mostly going to TV and newspapers. Today, social time and work time have moved online, but luxury consumption and spending on social signals have not yet completely moved online.
Therefore, we have made many investments in the NFT field, such as Magic Eden, which is one of the largest NFT markets across chains. When Electric first contacted the Magic Eden team, it was clear that they were leaders in the crypto space and deeply understood the value of NFTs, memes, and digital culture.
Magic Eden is the leading multi-chain NFT marketplace, supporting transactions on Solana, Ethereum, Polygon and Bitcoin Ordinals, and is known for its low fees and user-friendly platform. Electric Capital led the latest round and participated in the seed round. Other investors include Sequoia, Greylock and Paradigm. The company's most recent round valued it at $1.6 billion.
**6. Have you heard of the NFT-compatible credit card launched by
Mastercard?**
Maria
Never heard of it!
See more at: https://newsroom.mastercard.com/news/europe/en/newsroom/press-releases/en/2022/september-2022/hi-launches-world-s-first-nft- customizable-card-with-mastercard/.
Tesvara
I first learned about this product when I had dinner with Jay, the president of our SBC. This is an NFT customizable Mastercard launched by hi (a financial application that supports cryptocurrency and fiat currency). This card can be used to purchase goods globally with fiat currencies, stablecoins, and other cryptocurrencies, and the card cover can be customized with an NFT avatar.
I think this kind of real-world convergence innovation can be very beneficial in helping more people understand cryptocurrency or at least make it accessible to more people. At the same time, spending cryptocurrencies via cards also increases the utility of holding cryptocurrencies. Additionally, this eye-catching product is ideal for online crowd promotion, as these people themselves are interested in community signals and would appreciate more ways to demonstrate that they belong to a group.
6. Electric Capital’s investment in 2024
The report mentioned that you invested in EigenLayer, which added more than $30 billion in total locked value (TVL) to Ethereum through its "re-pledge service". How do you assess its impact on Ethereum and DeFi? What’s next for EigenLayer? EigenLayer provides "re-pledge service", which is a middleware protocol on Ethereum that allows ETH validators to re-pledge Token to support other protocols. Electric Capital participated in EigenLayer’s $14.5 million seed round in August 2022 and its $50.8 million Series A round in February 2023.
Maria
EigenLayer launched "Liquid Re-pledge Tokens" (LRTs), opening up a new field and adding more than $30 billion in TVL to the Ethereum mainnet. EigenLayer is a great example of the developer flywheel effect. It started with a small group of dedicated developers who unlocked a new use case that attracted capital, users, and new products. As TVL grows, more and more developers begin to build AVS (Active Verification Service) for EigenLayer, thereby creating more utility and further attracting more capital, users and developers.
7. Why did you invest in Monad?
Monad is an EVM-compatible Layer 1 blockchain designed to achieve high performance without sacrificing decentralization and security. Electric Capital participated in Monad’s $225 million Series A round of financing led by Paradigm in April 2024.
TesvaraMonad achieves high performance while maintaining EVM compatibility. This approach bridges the gap between Ethereum's strong developer ecosystem and consumer applications' needs for speed and efficiency.
Avichal founders Eunice Giarta, Keone Hon and James Hunsaker are all former managers of big technology companies and former employees of Jump Trading. They have rich experience in building high-frequency trading systems. This experience is ideal for developing a fast and scalable blockchain infrastructure.
Both Maria and Avichal highlighted Monad’s potential to support new use cases that require both Ethereum compatibility and high transaction throughput, such as on-chain order books and complex DeFi protocols. They see Monads as a potential catalyst for the next wave of blockchain application development.
**8. Many members of our club are new to crypto and often ask “What
should I develop?” As a venture capitalist deeply involved in this space, what gaps do you think our Stanford developers can fill?**
Maria
"Let's develop more exotic applications."