The Rise of Layer 1 Blockchains: Analyzing Growth in Token Holder Bases

The blockchain landscape in 2025 is defined by a fierce competition among Layer 1 (L1) protocols to capture market share through scalable infrastructure, institutional adoption, and user-centric innovation. As the crypto market matures, the long-term investment potential of L1s increasingly hinges on the size and growth of their token holder bases, which serve as proxies for network utility, decentralization, and ecosystem vitality. This analysis evaluates Ethereum, Solana, Avalanche, Binance Smart Chain (BNB Chain), NEAR Protocol, and Cardano through the lens of their Q3 2025 performance, focusing on metrics such as Total Value Locked (TVL), daily active addresses, and cross-chain activity.

Ethereum: The Unshakable Foundation

Ethereum remains the bedrock of the crypto economy, with on-chain applications managing $370 billion in user assets-a $290 billion lead over Solana and Polygon, according to a ZyCrypto report. Its dominance in real-world asset (RWA) tokenization, accounting for 55% of the market, underscores its role as the default infrastructure for decentralized finance (DeFi) and enterprise use cases, per the same report. However, Ethereum's growth is increasingly challenged by nimble competitors. While its network effects are formidable, the rise of alternative L1s with lower fees and faster throughput could erode its market share over time.

Solana: The ETF Catalyst

Solana's Q3 2025 performance was electrified by the launch of the Bitwise Solana Staking ETF (BSOL), which attracted $545 million in net inflows, including $223 million in seed investments, according to a Yahoo Finance report. This contrasts sharply with outflows in Bitcoin and Ethereum funds, highlighting Solana's appeal to institutional investors seeking high-yield staking opportunities. The network's TVL and transaction volume have surged, driven by its 50,000 TPS capacity and low fees. Yet, scalability concerns and competition from Ethereum's upcoming upgrades could temper its momentum.

NEAR Protocol: Scaling Through Sharding

NEAR Protocol's Q3 2025 results demonstrate its strategic focus on cross-chain interoperability and scalability. The network increased its shard count from 8 to 9, boosting throughput by 12.5% and enabling $234.9 million in cross-chain transaction volume via NEAR Intents, according to a NullTX report. With a $3.3 billion market cap and 24.3% quarter-over-quarter growth, the NullTX report notes, NEAR is positioning itself as a bridge between L1s, appealing to developers seeking modular infrastructure. Its performance suggests it could emerge as a key player in the cross-chain ecosystem.

Binance Smart Chain: The DeFi Powerhouse

Binance Smart Chain (BNB Chain) continues to dominate retail-driven DeFi activity, with 3.62 million daily active addresses and a 217% surge in TVL to $17.1 billion, according to a StockTwits report. The network's meme token ecosystem, exemplified by projects like $BALZ, has further amplified its user base, with over 40,000 followers on X, per the same report. However, BNB Chain's growth in stablecoin transactions slowed by half in Q3 2025, according to a Bitcoinist report, signaling a maturing market. Its reliance on Binance's ecosystem and regulatory scrutiny in key markets remain risks.

Avalanche: Enterprise-Grade Subnets

Avalanche's Q3 2025 growth is anchored by its Subnets-a modular architecture allowing application-specific blockchains with customizable rules. The C-Chain's daily active addresses jumped from 200,000 to 481,000, and DeFi TVL reached $1.68 billion, according to a BingX report. Institutional adoption is accelerating, with a Nasdaq-listed firm committing $1 billion to AVAX through validator staking, per the same report. Avalanche's focus on enterprise and government partnerships, including Wyoming's government-backed stablecoin (FRNT), positions it as a hybrid between Ethereum's security and Solana's speed, according to a CoinGlass article.

Cardano: A Battle for Relevance

Cardano's $20.65 billion market cap is overshadowed by emerging competitors like Remittix (RTX), which leverages real-world payment utility to challenge its position, according to a Cryptopolitan report. Founder Charles Hoskinson has emphasized Bitcoin-based DeFi as a potential $TVL catalyst for Cardano, according to a ZyCrypto report, but the network's user engagement and organizational coordination remain hurdles. While its technology is robust, Cardano's ability to compete in a crowded market will depend on execution and partnerships.

Investment Considerations

The L1 landscape in 2025 is characterized by divergent growth trajectories. Ethereum's entrenched position ensures it remains a core holding, but its long-term upside depends on Layer 2 innovations and RWA adoption. Solana and Avalanche offer compelling risk-adjusted returns, with Solana's ETF-driven inflows and Avalanche's enterprise Subnets addressing critical pain points. NEAR's cross-chain focus and BNB Chain's DeFi momentum also warrant attention, though both face regulatory and competitive headwinds. Cardano, while undervalued, must overcome execution risks to justify its market cap.

For investors, the key is to balance exposure to established leaders like Ethereum with high-growth L1s that address specific market gaps. The next 12–18 months will likely see further consolidation, with protocols that prioritize interoperability, institutional onboarding, and user experience emerging as winners.