Crypto Builders Are Burned Out, Broke, and Bailing
Over the past year, there has been a significant decline in developer activity. The industry has seen a drop of more than 50% in code commits and a 40% decrease in the number of active developers.
It’s been a tough quarter for crypto investors and traders. Prices continue to fall, and with Trump’s new tariff strategy in play, things might get even worse. However, with the hype dying down, people have finally stopped chasing the next big narrative or memecoin and started taking a hard look at the fundamentals. Spoiler: they are not looking great.
One of the most important charts in crypto is not the price chart—it is the developer activity chart. This metric offers insight into the health of the ecosystem and whether new teams are entering the space to build impactful projects that could eventually reach millions of users.
Why is Activity Declining?
There are several factors contributing to this downturn: memecoin mania, the surge in AI interest, and poor developer support.
The 2024 memecoin frenzy created countless viral stories about people turning $10 into millions. While entertaining, it also shifted investor focus away from projects with real fundamentals to chasing the next hyped-up “shitcoin.” With little demand for real products, it is no surprise that developers have less incentive to build meaningful things.
Markets and VCs have rewarded protocols without products for too long. Only thing in crypto with the PMF is the defi/memecoin casino, but that's not sustainable.
— Ben Ward (@wardy_ben) April 7, 2025
We're still a long way from building real shit that real people want to use.
It is likely no coincidence that the decline in developer activity began right when Pump.fun launched on Solana in March 2024.
Another major factor is the AI boom. With fewer users demanding functional crypto products and the allure of AI on the rise, many developers are pivoting to AI in hopes of building the next big thing. While it is encouraging to see some projects combining blockchain and AI, it is clear that AI is becoming a competing field, and crypto may be losing talented minds to it.
Ethereum’s Developer Exodus
Then there is the Ethereum ecosystem—arguably the backbone of the entire crypto space, accounting for at least 50% of all developer activity. Yet, developers are increasingly voicing frustrations:
“The entire Ethereum and L2 roadmap focuses on serving very large clients with lots of consumer users. Nobody cares about the ‘developer.’”
One developer, who has worked across multiple ecosystems, shared that in the past, he would receive grants and airdrops for building on a project. Today, most airdrops are captured by “farmers” who simply perform on-chain tasks, while grant programs have become less practical.
“Optimism was giving out developer grants with a one-year lock-up. If I’d built something on Optimism last year, I’d now be down 80% on that grant. How am I supposed to build anything with this?”
Ethereum Foundation and related entities appear uninterested in supporting the price of ETH in the short term—unsurprisingly, this has led to developer attrition.
The technical experience has also become much more challenging. With the rise of L2s, developers now need deep knowledge of how the L1 works, how it interacts with L2s, and they must keep up with constant updates—all while being told their apps should be immutable.
“I just want to work with one system that works and doesn’t change. Did you know Windows was backward-compatible from, like, MS-DOS?”
Ethereum’s L2 roadmap has not only fragmented liquidity but also fragmented developer activity. Many are now stuck juggling multiple L2s and L1s, trying to piece everything together.
This is shaping up to be a perfect storm for the crypto market. Don’t be surprised if it takes a while to recover. The industry may need to pause, reflect, and perhaps take a new path to address these issues and rebuild a healthier ecosystem for everyone.