Gaming activity on some layer-2 blockchains rose by over 20,000% in February 2025 while the number of daily unique active wallets (dUAWs) dropped, according to a report by DappRadar.

Abstract, an Ethereum layer-2 blockchain developed by Igloo, the parent company of NFT collection Pudgy Penguins, led all chains with a growth of over 20,000% in daily active unique wallets (dAUWs). Soneium, Sony’s Ethereum L2 blockchain, came in second with a growth of over 3,200%, and Linea, another L2 blockchain, placed third with over 1,000% growth.

Monthly growth of unique active wallets across blockchains. Source: DappRadar

On Abstract and Soneium, two games were the primary drivers of activity growth: Treasure Ship on Abstract, which currently has around 72,000 UAWs, and Evermoon on Soneium, with approximately 32,000 UAWs.

However, despite the rise of gaming activity on L2s, dUAWs overall dropped by 16% compared to January, settling at around 5.8 million. The report notes that while blockchain gaming “has historically held strong market dominance, economic conditions have shifted investor focus back towards DeFi. With market uncertainty causing traders to exit positions, DeFi now leads as the most dominant sector.”

The most dominant blockchains for gaming in terms of dUAWs are opBNB, a layer-2 blockchain built on top of the BNB Smart Chain; independent layer-1 blockchain Aptos built for decentralized applications; and Nebula, which is a Skale chain.

According to the report, blockchain gaming investments soared to $55 million in February, marking a 243% increase from January, with 92% of the funds allocated to infrastructure development.

Blockchain gaming activity sees year-over-year growth, but challenges persist

As Cointelegraph reported in February, blockchain gaming activity saw a significant year-over-year surge, with daily unique active wallets soaring by 386% to 7 million. The sharp rise led some industry observers to speculate about a potential blockchain gaming bull run in 2025 — though that prospect is now under debate.

One of the games that had been drawing attention to the use of blockchains in games was “Off The Grid.” The title, which plans to use an Avalanche subnet, generated more than 100 million transactions in its first month.

The sector, however, has faced challenges. Gunzilla Games Web3 director Theodore Agranat told Cointelegraph that there “is no new money coming into the system,” explaining that existing capital is just being recycled between gaming projects.

“They will just go from project to project and extract whatever value they can from that project,” he said. “And once there’s no more value to be had there, they are going to move on to another project.”

Magazine: Web3 Gamer: How AI could ruin gaming, The Voice, addictive Axies game

The Department of Government Efficiency (DOGE) is reportedly proposing cutting the Internal Revenue Service’s (IRS) workforce by 20% in a change expected to take effect by May 15, 2025.

According to CNN, the cuts would impact an estimated 6,800 employees at the government agency, in addition to the 6,700 probationary employees who have already been let go and 4,700 IRS agents who were given severance packages to retire.

However, a recent ruling from US district judge William Alsup ordering federal agencies to reinstate probationary workers terminated due to the DOGE cost-cutting programs could hinder the layoffs if the order is not overturned.

President Trump has promised comprehensive tax reform in the United States, including potentially eliminating the federal income tax and funding the federal government exclusively through tariffs on foreign goods.

President Trump discussing his policy proposals with reporters inside the Oval Office. Source: The White House

Related: Crypto taxes, DOGE, Trump and avoiding an IRS audit: Taxbit exec spills the tea

DOGE pursues cost-cutting and efficiency strategies

The Department of Government Efficiency, headed by businessman Elon Musk, is exploring methods to reduce the $36 trillion US national debt by substantially reducing the size of the federal bureaucracy and introducing cost-cutting measures.

One of the more unique measures proposed included putting all public spending onchain to reduce deficits and ensure transparency.

On Feb. 21, the Securities and Exchange Commission (SEC) announced it was cutting its regional office directors to comply with the Trump administration’s cost-saving directives.

However, under the reorganization plan, the regional offices, which are spread out across major US cities, would stay open, and the SEC recently submitted its 2025 budget proposal to Congress requesting $2.6 billion.

The US national debt has exploded to over $36 trillion. Source: US Debt Clock

President Trump and Elon Musk have considered passing on 20% of the DOGE savings to Americans in a stimulus check or potential tax credits.

Research from accounting automation company Dancing Numbers argued that Trump’s plan to eliminate federal income tax could save the average American $134,809 in taxes throughout their lives.

The company added that these lifetime tax savings could extend to as much as $325,561 per person if other wage-based taxes at the state level are also repealed.

Despite this, not everyone is convinced by DOGE’s cost-cutting tactics, including US Senator Elizabeth Warren, who is highly critical of Elon Musk, Trump, and DOGE.

In January 2025, the Massachusetts Senator sent a letter to the DOGE proposing increasing taxes and federal spending to make the government more efficient.

Magazine: Elon Musk’s plan to run government on blockchain faces uphill battle

Digital asset exchange DigiFT has launched Invesco’s tokenized private credit strategy on Arbitrum, further expanding the use cases of real-world assets (RWA) and giving institutional investors access to onchain credit markets.

According to a March 13 announcement, Invesco’s US Senior Loan Strategy (iSNR) token is now live on Arbitrum, a popular Ethereum layer-2 network.

The tokenized asset was launched on Feb. 19 and is designed to track the performance of a private credit fund managed by Invesco, a publicly traded investment manager headquartered in Atlanta, Georgia. 

At the time of launch, the Invesco fund had $6.3 billion in assets under management, according to Bloomberg. 

DigiFT described the iSNR token as the “first and only tokenized private credit strategy.”

The iSNR tokenized fund has a minimum investment of $10,000. Source: DigiFT

DigiFT CEO Henry Zhang said adding iSNR to Aribitrum increases its utility by “allowing DeFi applications, DAOs and institutional investors to integrate with a regulated, onchain private credit strategy.”

Consistent with the initial launch of iSNR on Ethereum last month, investors on Arbitrum can purchase tokenized shares using popular stablecoins USDC (USDC) and USDt (USDT).

Related: Cantor Fitzgerald taps Anchorage Digital, Copper as Bitcoin custodians

DeFi tokenization on the rise

Despite the recent crypto market downtrend, RWA tokenization appears to be heating up with the launch of several DeFi-oriented products. Positive regulatory developments, the rise of liquid multichain economies and innovations in decentralized exchanges are expected to push RWA tokenization into the crypto limelight this year. 

Earlier this week, tokenization company Securitize announced that oracle provider RedStone will deliver price feeds for its tokenized products, which include the BlackRock USD Institutional Liquidity Fund (BUIDL) and the Apollo Diversified Credit Securitize Fund (ACRED). 

The integration means that Securitize’s funds “can now be utilized across DeFi protocols such as Morpho, Compound or Spark,” RedStone’s chief operating officer, Marcin Kazmierczak, told Cointelegraph. 

Meanwhile, asset manager Franklin Templeton has launched a tokenized money fund on the Coinbase layer-2 network Base and a US government money fund on Solana. 

Private credit ($12.2 billion) and US Treasury debt ($4.2 billion) have dominated real-world asset tokenization so far. Source: RWA.xyz

According to industry data, the total value of RWAs onchain has grown by 17.5% over the past 30 days to reach $18.1 billion. Private credit and US Treasury debt account for nearly 91% of that total. 

Related: Trump-era policies may fuel tokenized real-world assets surge