The decentralized application (DApp) sector concluded Q3 2025 with diverse outcomes, featuring a remarkable surge in decentralized finance (DeFi) liquidity hitting $237 billion. However, DApp wallet activity experienced a notable decline of 22% as reported by DappRadar.

According to a report shared with Cointelegraph, the average number of daily unique active wallets dropped to 18.7 million, a 22.4% decrease from Q2. While DeFi protocols achieved a new record in total value locked (TVL), the lack of retail engagement indicated a significant disparity between the influx of institutional funds and retail user activity.

“Every category saw a reduction in active wallets throughout the quarter, with Social and AI sectors facing the most impact,” reported DappRadar. Translation: “Every category noted a drop in active wallets, but the impact was mostly felt in the Social and AI categories.”

DappRadar pointed to several factors for the unprecedented DeFi liquidity, including increased institutional investment in Bitcoin and stablecoins, regulatory clarity from the US GENIUS Act, and new infrastructure for real-world asset tokenization.

During the same period, stablecoin inflows soared to $46 billion, led by Tether’s USDt and Circle’s USDC. New platforms specializing in stablecoins also contributed to the rise in DeFi TVL.

In terms of network performance, Ethereum retained its position as the leading DeFi network with $119 billion in locked assets, despite a slight 4% decline compared to Q2. The second-ranking Solana observed a 33% decrease in TVL, while BNB Chain emerged as a notable player by achieving a 15% gain in TVL during this quarter, attributed to the launch of the Aster decentralized exchange.