AI-driven decentralized applications (DApps) are shaking up the Web3 landscape, potentially dethroning gaming and decentralized finance (DeFi) from their long-held dominance. According to DappRadar’s latest industry report, AI DApps have surged to 16% market dominance in April 2025, a significant leap from the 11% recorded just two months prior. This rise comes as gaming and DeFi, each holding 21% of the market, grapple with stagnation.
AI DApps: The New Frontier
The surge isn’t just a flash in the pan. DappRadar analyst Sara Gherghelas highlighted an increasing interest in AI tools across various industries, noting that “AI-powered DApps are steadily carving out their place in the decentralized ecosystem.” If this momentum continues, AI could soon rival the traditional powerhouses of DeFi and gaming, ushering in a new era for the DApp landscape. This trend aligns with the broader movement towards ‘DeFAI,’ as discussed in AI Crypto Agents Are Ushering in a New Era of ‘DeFAI’.
In April, AI DApp activity skyrocketed by over 26%, reaching 3.8 million daily unique active wallets (dUAW), up from 2.6 million in February. In stark contrast, DeFi and gaming both saw declines, with DeFi activity dropping by 16% to 4.8 million dUAW, matching gaming’s 10% decline to the same figure. The shifting sands signal a potential realignment in user preferences and market dynamics.
Leaders in the AI DApp Arena
The top AI DApps have maintained their positions, with LOL—a project billing itself as an AI-powered mining system—leading the pack. Using an innovative approach, LOL rewards users with tokens based on laughter recordings analyzed by its AI bot. Following LOL is Dmail Network, a decentralized messaging service, and World.Fun, a launchpad for deploying AI agents into multi-agent simulations. “These projects are not just riding the hype: they’re building utility,” Gherghelas emphasized, underscoring the staying power of these early leaders.
Despite the promising growth, the road ahead isn’t without obstacles. Last December, industry insiders predicted AI agents would transform Web3 by 2025, particularly in crypto staking and on-chain trading. However, they also warned of potential challenges, including technical difficulties, regulatory hurdles, and concerns about centralization that could slow progress. For more on how AI is being integrated into legal frameworks, see AI-Powered Court System Is Coming to Crypto With GenLayer.
Social DApps and the Broader Web3 Landscape
While AI DApps grab headlines, social DApps are quietly making their own advances. In April, social DApp activity rose by 18% to 3.6 million dUAW, capturing over 15% market dominance. This uptick signifies that Web3 is holding its ground, even amid broader market turbulence triggered by recent U.S. tariffs. According to Gherghelas, April’s top performers underscore a key narrative: “utility and narrative-driven hype, especially around memecoins and AI, are major drivers of user engagement.”
The overall Web3 ecosystem recorded 23 million daily active wallets in April, a slight dip from February’s 24 million, yet it remains resilient amid external pressures. The interest in AI and social DApps indicates a maturing market, one where users seek genuine utility and engagement over mere speculation.
Looking Ahead
As AI DApps continue their march, the question looms: can this trend sustain itself, or will it be a temporary surge? The upcoming months will be crucial as these applications attempt to solidify their foothold in a competitive market. Moreover, as regulatory scrutiny intensifies and technical challenges persist, the adaptability of AI DApps will be tested. Their ability to innovate and address these hurdles will determine their long-term impact on the Web3 landscape.
In the ever-evolving world of cryptocurrency and blockchain, the rise of AI DApps is a story worth watching. Whether they will lead to a reshuffling of the Web3 hierarchy remains to be seen. But one thing’s clear: they’re not just a passing fad. They’re here to challenge the status quo.
Source
This article is based on: AI decentralized apps are coming for the Web3 throne: DappRadar
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
