Crypto Exchanges Focus On New Ways to Bring Users Onchain
Cryptocurrency exchanges are focused more than ever on bringing new users onchain.
This shouldn’t come as a surprise, though. Going onchain often results in organic, exponential growth.
For example, Dogecoin (DOGE) recently saw a surge in its user engagement. According to CryptoQuant data, Dogecoin saw a 400% rise in active user addresses this week.
This suggests that an increasing number of users are leveraging the Dogecoin network. This also indicates an uptick in development activity, despite recent price fluctuations.
Crypto Exchanges Focus On Onchain Growth
United States-based cryptocurrency exchange Gemini told Cryptonews that the company recently hired a “head of onchain” to help onboard new users, while keeping them coming back for more.
Eric Kuhn, head of onchain at Gemini, explained that onchain engagement serves as a way to build bridges to a Web3 ecosystem.
For instance, Kuhn shared that Gemini allows users to deposit and withdraw stablecoins and native tokens across any blockchain network.
“We think there are really exciting things happening onchain,” Kuhn said. “We are big fans of solving real challenges using onchain, including participating in prediction markets and cross-border payments.”
Cryptocurrency exchange Coinbase is also looking to drive consistent engagement through onchain activations.
Gary Sun, vice president of marketing at Coinbase, told Cryptonews that going onchain opens up new opportunities for users to connect in ways that were never before possible.
Coinbase Brings Onchain Activations to Warriors Night
For example, Sun shared that Coinbase partnered with San Francisco’s official basketball team, the Golden State Warriors, last October to help fans connect with athletes.
Sun noted that onchain partnerships and activations enable Coinbase to achieve its goal of “making crypto easy for everyone.”
He explained this includes sports fans who may not have considered going onchain before.
Findings from Coinbase research also show that basketball fans are more likely to own or to be curious about cryptocurrency adoption.
“Through our partnerships with the NBA and WNBA – along with in-arena activations with the Warriors and the Clippers – we can show fans how crypto is enabling faster, cheaper and more accessible financial tools than our current outdated system,” Sun said.
Coinbase sponsored the National Basketball Association’s (NBA) Warriors Night on March 18 in San Francisco.
The crypto exchange launched onchain activations that let fans claim digital collectibles, unlock exclusive content and participate in blockchain-powered activities in person.
Sun remarked that these activations have been an important part of Coinbase’s user growth recently. In January this year, the crypto exchange brought over 1600 sports fans onchain.
“The crypto industry is at the forefront of a massive shift in how fans experience sports, and blockchain technology is powering this transformation,” Sun remarked. “By leveraging onchain experiences, Coinbase is creating new opportunities for fans to engage, own and be part of something bigger.”
Why Onchain Is Important
While it’s notable crypto exchanges are focused on onchain efforts, it’s important to understand why this is critical for user growth.
Erin Grasmick, senior infrastructure engineer at Web3 engineering firm Parity Technologies, told Cryptonews that engagement is not just about getting users, but also about keeping folks interested daily.
“Blockchains should be a joy to use and bring value to everyone, so onchain is critical in earning adoption of an actual chain,” Grasmick said. “If people enjoy using the chain, it’s easy to keep them coming back.”
Grasmick added that bringing users onchain doesn’t necessarily have to involve incentives.
“As we’ve seen in the past 6 months or so, a lot of farming happens when incentives are involved, and once the incentives go away, so do the users,” she remarked. “This isn’t real engagement.”
Onchain Growth Drives Business Revenue
Grasmick further pointed out that businesses with revenue depend on getting their users onchain.
For example, she noted that Mythos, a non-fungible token (NFT) gaming chain, drives user engagement through sports partnerships and other activities where users do not even know a blockchain network is involved.
Mythos is supported by blockchain gaming studio Mythical Games.
In November 2024, Mythical Games teamed up to launch FIFA Rivals, a free-to-play soccer game on iOS and Android. FIFA Rivals is powered by the Mythos blockchain and secured by the Polkadot network.
“This is an example of how Mythos is bringing in a non-crypto-native and crypto-native gaming audience. Going onchain adds to the user experience and supports businesses,” Grasmick commented.
FIFA Rivals is scheduled to be released in the summer of this year. The game will allow gamers to manage their own soccer clubs, while competing against other players in real-time.
The Onchain Revolution
Grasmick believes that this year in particular will be important for bringing users onchain, especially as more Layer-2 (L2) networks emerge.
“The landscape and industry is a tough one, and where we see many chains launch we also see many chains die,” she said.
Grasmick further explained there is huge value in building for the long-term.
“Fostering strong communities along the way is very crucial—not just in that your community is your userbase, but your community can also evangelize to others and grow your userbase, whether you are a protocol, a chain, or a decentralized application (Dapp),” she said.
Sun shared that Coinbase has future plans to continue to bring users onchain to drive growth and engagement.
“In addition to collaborations with the NBA and WNBA, we have partnerships in soccer with Borussia Dortmund, in motorsports with Aston Martin Aramco, and esports with Team Liquid,” he said. “Coinbase is constantly exploring new ways to bring onchain experiences to fans through these partnerships.”
Challenges to Consider
However, Grasmick pointed out that the user onboarding experience remains a challenge when it comes to going onchain.
“There is a lot of liquidity fragmentation as there are so many different chains now, especially in the Ethereum/L2 landscape, where new users have no way to differentiate between chains other than a direct draw from the Dapps which exist on that chain,” she said.
Given this, Grasmick believes engagement is the most important thing for businesses to consider.
“A lot of different chains are competing for users who are already onchain, so creating engagement which is ‘good enough’ to get new users onchain is something like a holy grail,” she said.