Crypto Software Developers Are Unfazed by Recent Swoon in Prices

(Bloomberg) -- The number of monthly active software developers in crypto hit an all-time high in December, even as prices retreated from record levels.

About 18,400 active developers worked on crypto-related projects as of last month, up 75% from January 2020, according to a report from the investment firm Electric Capital. Nearly 34,400 programmers joined the sector last year, up from about 20,500 newcomers in 2020. Electric analyzed 500,000 code repositories and 150 million code commits across crypto-related projects.

Typically, developer activity jumps when cryptocurrency prices rally, Electric said. Bitcoin, the world's biggest cryptocurrency, rose by about 60% last year, though it slumped by about 20% after it reached a record in November. More developers joined crypto projects in 2021 than in any prior year in the industry's more than a decade-long story, Electric said.

The trend could continue into 2022 with many people changing careers after receiving year-end bonuses, Avichal Garg, a partner at Electric Capital, said in an interview. The prior peak for new developers moving to crypto was 2018, when a bear market followed the meteoric Bitcoin price rise of 2017.

“There are a lot of people who get excited when the run-up is happening, the executing takes a little bit of time,” Garg said in an interview. “Even if we were to have a big correction, I would not be surprised to see developer growth to continue into the bear market.”

While about 20% of the new developers joined Ethereum-related projects, a handful of other undertakings had seen huge growth as well, Electric found. Projects Polkadot, Solana, Near, Bitcoin Smart Chain, Avalanche and Terra are growing faster than Ethereum did at the same point in its history, Electric found.

And while more than 2,500 developers are working on DeFi projects, those efforts are seeing a lot of turnover. That's partly the result of many DeFi tokens' prices, used to pay developers, having dropped in value in recent months.

“There are a lot of new developers dabbling with DeFi, most of them are dropping off,” Garg said. But as some leave, others take their place, so that DeFi's developer ranks grew as fast as the rest of the overall crypto developer ecosystem, he said.