U.S. Share of Web3 Developers is Shrinking Published: April 2022 Published by: Electric Capital www.electriccapital.com

1. U.S. Share of Web3 Developers
is Shrinking
April 2022
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policy@electriccapital.com

2. Table of contents
Executive summary 3
Overall status of Web3 development 9
Decline of Web3 development share in the U.S. 14
Methodology cross-check 19
Terminology 22
Appendix 25
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3. Executive Summary
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4. Context
Web3 is the next wave of the Internet
Blockchain / Web3 has exploded in popularity as a once-in-a-generation technology platform and
economic opportunity. Web3 has the potential to fundamentally change money, the financial system,
and the Internet more broadly.
A decentralized Internet ecosystem built on blockchain, where economic value is delivered to the users
of the products via tokens, is a paradigm shift on par with the Internet. What’s valuable and celebrated
within the industry is also the open-sourced nature of the underlying technology, which enables
unparalleled security, access, and transparency.
One of the early and leading indicators of this emerging technology is in software developer
engagement – the more activity (“code commits”) in the underlying software, the more vibrant the
ecosystem. Due to the open-sourced nature of blockchain technology, it is possible to analyze developer
activity by looking at the volume of code commits and derive important trends about the industry.
That the U.S. is increasingly losing market share in Web3 software development may mean both that
the developer community is getting bigger and more global, but may also weaken U.S. preeminence in
finance, national security, and technology in the years to come.
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5. Insight
The U.S. is losing its lead in Web3 software
developers
Over 18,416 developers are responsible for a market worth nearly $3 trillion
at its height in November 2021, and growing
The U.S. was the first and biggest hub for Web3 software development. This
gave the U.S. an early lead to shape the future of Web3 technology, and with it,
the future of finance
The U.S. has lost market share to India, Russia, China, and other emerging
markets as the relative pace of U.S. Web3 development slows. Global Web3
software development activity has grown more outside the U.S., threatening
the U.S.’s preeminence in finance and technology.
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6. Implications
The U.S. should reinforce its lead in Web3 technology
development to preserve American preeminence
Jobs & Financial Impact: U.S. preeminence in Web3 software development
enables the U.S. to create jobs and growth in a market worth nearly $3 trillion
at its height, and fuel financial inclusion, as the broader Web3 ecosystem
continues to grow
Standards Influence: By designing new protocols, U.S. engineers define the
standards for financial systems and data systems. These are the SWIFT and
HTTP equivalents of the modern era. Losing market share means that other
countries can have larger influence over global financial and data standards
National Security: The U.S. must shape development of new technology and
financial products to reflect American values and national security objectives.
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7. Obstacles
Lack of clarity around U.S. legal and regulatory
obligations drives Web3 software development to
India, Russia, West Africa and South East Asia
Ambiguous legal and regulatory framework has chilled U.S. innovation,
especially when coupled with vague enforcement threats
Disclosure standards fail to reflect capabilities of Web3 platforms, and fail to
leverage features of Web3 platforms that would advance regulatory
objectives
Attempts to apply traditional regulatory frameworks to innovative technology
sacrifice opportunities to create solutions that both incentivize risk mitigation
and foster further innovation.
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8. Status of Web3 development
as of end of 2021
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9. Web3 reached $3 trillion value: an all-time high
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Note: all time high happened on Nov, 8th 2021
Apr 2016 Apr 2017 Apr 2018 Apr 2019 Apr 2020 Apr 2021
Apr 2015
0
500
1K
1,5K
2K
2,5K
3K
3,5K
Market
Value
[Billions]
Web3 Market Value Over Time Nov 2021
$3 trillion

10. Web3 developer ecosystem is at all-time high
18,416 monthly active Web3 developers in 2021 (all-time high)
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Web3 Monthly Active Developers Since 2015
Jan 2015 Jan 2017
Jan 2016 Jan 2018 Jan 2019 Jan 2021
Jan 2020 Jan 2022
0
2K
4K
6K
8K
10K
12K
14K
16K
18K
20K
Developers
Dec 2021
18,416

11. Developers stay in Web3, even if asset prices fall
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Jul 2015 Jul 2016 Jul 2017 Jul 2018 Jul 2019 Jul 2020 Jul 2021
Date
0
2K
4K
6K
8K
10K
12K
14K
16K
18K
20K
Developers
$0.0T
$0.5T
$1.0T
$1.5T
$2.0T
$2.5T
$3.0T
$3.5T
Monthly Software Developers vs Web3 Network Value
Network
Value
Developer Peak
Network Value ATH
Network Value Peak
Developer ATH

12. The U.S. can capture the next 1 million Web3 developers
An accumulated growth model from 2017 to 2022 suggests a ~1M developer base by 2030
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Note: growth is modeled using Compound Annual Growth Rate (CAGR) of 55.55% (using actual values from 2017 to 2021).
2022
2020 2022 2023 2024 2025 2026 2027 2028 2029 2030
2018
2016 2017 2019 2021
2015
1k
2k
3k
10k
20k
30k
100k
200k
300k
1m
Developers
Projected Web3 Monthly Active Developers (Logarithmic Scale)
2024
69,000+
2030
980,000+
2029
630,000+
Date
2026
165,000+
2027
260,000+
2028
400,000+
2025
105,000+
2023
44,000+
2022
28,000+
2021
18,416

13. Despite increasing Web3 development
globally, U.S. Web3 development
market share declined
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14. U.S. is losing market share in Web3 development
According to Code Commit Time (Method 1 in Appendix)
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Note: Fitted line is calculated using a linear regression statistical model
Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019 Jan 2020 Jan 2021 Jan 2022
0%
10%
20%
30%
40%
50%
60%
70%
Percentage
of
commits
Code Commits to Web3 Repositories During U.S. Working Hours (9am EST to 9pm EST)
Trend

15. U.S. is down to 29% in self-reported market share
According to Self-reported Location (Method 2), U.S.-based Web3 developers dropped from 47%
to 29% since 2015. This corroborates inferred code-commit data from Method 1.
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2015 2016 2017 2018 2019 2020 2021
0%
10%
20%
30%
40%
50%
Percentage
of
developers
Percentage of Web3 Software Developers in United States of America

16. U.S. Web3 dev growth is slower than other countries
According to Self-reported Location (Method 2), U.S. has increased its Web3 developers by 200%,
while the rest of the world increased 300% — the U.S. is losing market share
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U.S.
Germany
United Kingdom
India
France
Russia
Canada
China
Netherlands
Switzerland
Singapore
Australia
Ukraine
Japan
Poland
Argentina
Brazil
Spain
Portugal
Italy
Vietnam
Nigeria
Turkey
Pakistan
New Zealand
Indonesia
Sweden
Belgium
Serbia
Colombia
Mexico
Austria
Lithuania
Bulgaria
Estonia
Romania
0
200
400
600
800
1000 2017
2021
Number of Web3 Developers per Country — 2017 vs 2021 — (Cut-Off > 15)
Number
of
developers

17. Russia and India are growing and taking market share
Seeing moderate Web3 development growth from a host of smaller countries
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2015 2016 2017 2018 2019 2020 2021 2022
0
20
40
60
80
100
Number of Web3 Developers With Reported Locations
Percentage
of
developers
Turkey
Vietnam
Japan
Nigeria
Portugal
Italy
Spain
Argentina
Singapore
Ukraine
Australia
Poland
Netherlands
Canada
China
Switzerland
France
Russia
India
U.K.
Germany
Other
U.S.
4.3%
4.1%
3.1%
2.7%
5.3%
5.9%
8.8%
17.5%
27.3%

18. Cross-checking:
Web2 development numbers
do NOT show U.S. declines
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19. Golang development in U.S. hours remained stable
Code commit times (Method 1) for Golang, a popular Web2 programming language
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Note: Fitted line is calculated using a linear regression statistical model
Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019 Jan 2020 Jan 2021 Jan 2022
0
10
20
30
40
50
60
70
80
90
Percentage
of
commits
Percentage Commits to Golang Repository at U.S. Working Hours (9am EST to 9pm EST)

20. Linux development is flat during US working hours.
Code commit times (Method 1) for Linux, the most famous operative system
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Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019 Jan 2020 Jan 2021 Jan 2022
0
5
10
15
20
25
30
35
40
45
50
55
60
65
Percentage
of
commits
Percentage Commits to Linux Repository at U.S. Working Hours (9am EST to 9pm EST)

21. Terminology
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22. Terminology
Software Development
Source Code
Text listing of commands to be compiled or assembled into
an executable computer program.
Open Source Software
Computer software that is released under a license in which
the copyright holder grants users the rights to use, study,
change, and distribute the software and its source code
publicly. Most Web3 code is open source while Web2 code
is mostly closed source. The protocols that enabled the
early Internet (HTTP, SMTP) are open source.
Code Commit
Software development operation that sends the latest
changes of the source code to the code repository. Higher
numbers of code commits indicate more software
development activity.
Code Repository
Central location where software code is stored. Can be
open source (public), or closed source (private).
GitHub
The largest code versioning hosted platform, with over 73
million software developers and more than 200 million code
repositories.
Golang
Popular open source programming language designed by
Google. 3 million developers use it to create Web Services.
Linux
Best-known and most-used open source operating system.
It sits underneath all the software on a computer. Around
two-thirds of the Internet is hosted in servers running Linux.
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23. Terminology
Crypto & Web3
Web2
Internet as a platform operated by centralized hosts with
websites that emphasize user-created content (i.e., social
media) and ease of use via browsers and mobile apps.
These are the current dominant state of the internet.
Web3
A decentralized Internet ecosystem built on blockchain
technology that enables users to own a share in the success
of the products they use via tokens.
Ground Truth
Information that is known to be real or true, provided by
direct observation and measurement.
Positive Rate
Percentage of developers that the model from Method 1
predicted to be in the U.S., and were self-reported there.
Blockchain
A shared ledger system maintained among nodes of a
computer network, grouping information into blocks that are
strung together, and therefore immutable.
Ecosystem
A set of applications that operate on a specific blockchain,
e.g., Ethereum, NEAR, Solana.
Network Value
At any given time, the product of the total number of units
of cryptocurrency circulating in a particular ecosystem
multiplied by the dollar value of that cryptocurrency.
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24. Methodology: How do we determine
the location of Web3 developers?
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25. M e t h o d 1
Timing of Code Submission
To measure Web3 software development activity, we use the precise time when Web3 software code is submitted to an open-
source database. Our analysis uses over 167 million such instances. The time of day when a developer submits code indicates
that developer’s working hours. We apply a 30-day moving-average of these discrete data points to drive our analysis. We
define U.S. working hours to span from 9am EST to 9pm EST (6pm PST).
Source
Publicly accessible source code on GitHub and Bitbucket since 2015. Details are available at github.com/electric-capital
Caveat
U.S. timezones are shared with Canada, Central America, and Latin America. Accordingly, we can distinguish between
developer activity in the Americas vs. other locations, but not within the Americas. All numbers attributed to U.S. are at
most these numbers and likely lower
U.S. work hours span 12 hours, assuming a 9 hour work day across East and West coasts. Such time span partially overlaps
with European working hours (1am EST to 12pm EST)
To evaluate this model’s performance, we used method 2 as the ground truth to conclude that method 1 has a true positive
rate of 78%. In other words, this time-based model is good at identifying development in the U.S.
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26. Method 2
Self-Reported Location
Software developers have accounts with public information such as location or links to their other social networks. When
available, we extract the country from the location data specified by the software developers in their social network accounts
and their code versioning platform accounts.
Sources
Twitter, GitHub
Caveat
Users can input free text in the location information. A percentage of values may be false locations or unrelated values
Users who move from one country to another might forget or not want to update their location information
We mapped 193 countries in 33 languages, including flag emojis, 1,008 U.S. locations and the top 15 cities in the world.
However, we didn’t map cities in certain languages. As a result, countries like China, India, Brazil or Indonesia might be
underrepresented.
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27. Self-reported Location: U.S. vs. non-U.S.
Code commit times (Method 1) is consistent with developers self-reported location (Method 2),
especially with developers self-reportedly in the U.S.
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0
5k
10k
15k
20k
25k
Number
of
commits
U.S. working hours
non-U.S.
working hours
non-U.S.
working hours
Number of Commits by Developers With Reported Locations
EST 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm 12pm 1am 2am EST
PST 12pm 1am 2am 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm PST
non-U.S. devs
(self-reported)
U.S. devs
(self-reported)
Note: 78% of the commits from developers self-reportedly in the U.S. happen at U.S. working hours

28. Code commits: Web3 ecosystems popular in the U.S.
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Most code commits for ecosystems popular in the U.S. occur during U.S. working hours
0
1
2
3
4
5
6
7
8
9
Percentage
of
commits
Solana
Celo
Avalanche
Flow
EOS
Monero
Stellar
Percentage of Commits Over Day Hours by Ecosystem
U.S. working hours
non-U.S.
working hours
non-U.S.
working hours
EST 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm 12pm 1am 2am EST
PST 12pm 1am 2am 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm PST

29. Code commits: Web3 ecosystems popular in Europe
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Most code commits for ecosystems popular in Europe occur during European working hours
0
1
2
3
4
5
6
7
8
Percentage
of
commits
Polkadot
Cosmos
Cardano
Percentage of Commits Over Day Hours by Ecosystem
EST 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm 12pm 1am 2am EST
PST 12pm 1am 2am 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm PST
U.S. working hours
non-U.S.
working hours
non-U.S.
working hours

30. Code commits: Web3 ecosystems popular in Asia
Most code commits for ecosystems popular in Asia occur during Asian working hours
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0
1
2
3
4
5
6
7
8
9
Percentage
of
commits
Terra
Binance
Smart Chain
Commit Density During the Day
EST 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm 12pm 1am 2am EST
PST 12pm 1am 2am 3am 4am 5am 6am 7am 8am 9am 10am 11am 12pm 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 10pm 11pm PST
U.S. working hours
non-U.S.
working hours
non-U.S.
working hours

31. Thank You
Avichal Garg
Emily Meyers
Enrique Herreros
Katherine Wu
Maria Shen
Sheila Warren
Sigal Mandelker
Raphael Guilleminot
Questions & Inquiries
policy@electriccapital.com
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