The number of new developers entering the cryptocurrency sector has dropped by nearly 50 percent over the past year, according to research from Electric Capital’s Developer Report.
The latest gauge of the state of the cryptocurrency developer ecosystem indicates that long-term coders that have worked in the industry for over a year commit more code and work more days than developers that have left.
According to the data, the cryptocurrency ecosystem has an estimated 21,300 monthly active open source developers as of June 1. The space has seen a 22% decline in the number of developers since June 2022.
The caveat is that developers that have exited the space are classified as “newcomers” that worked in the industry for less than a year. The impact of the departure of these developers was made less significant considering that they were responsible for less than 20% of all code commits over the past 12 months.
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Long term cryptocurrency developers who’ve worked in the industry for more than a year are responsible for over 80% of committed code.
The Developer Report estimates that some 7,700 newcomer developers left the space since June 2022. Emerging developers that have worked in the industry for up to two years has increased by 1650 while established developers that have over two years of experience in the cryptocurrency space increase by 150.
The report notes that the decline in newcomer developers is due to fewer coders exploring work in the cryptocurrency space. This has been exacerbated by an ongoing bear market which has suppressed wider cryptocurrency markets.
The analysts also suggest that while 2023’s retention of new developers has been significantly less that 2022 and 2021, the trend is not “abnormal” across a longer time frame.
“If we look at cohort retention analysis starting from 2015, we see that developers who join during bear markets leave faster.”
Newcomer developers typically enter the cryptocurrency sector around market peaks. There was a 70% dominance of newcomer developers six months after January 2018’s cryptocurrency market peak. This was followed by a 60% newcomer dominance in the six months following the November 2021 market all-time high.
Meanwhile emerging and established developers tend to dominate the sector when the cryptocurrency space enters bear market territory.
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