Developer Tooling Investment Brief: OSS Ecosystem 2024

Frequently Asked Questions

01.Why does open source developer tooling matter to a capital allocator?

Developer tooling is the infrastructure layer that determines how fast and how safely capital gets deployed into on-chain products. Electric Capital's 2023 report counted 22,411 monthly active open source developers across crypto, a leading indicator allocators can track the same way they track patent filings or hiring data in traditional venture diligence. Tooling quality shapes audit cost, deployment speed, and the eventual security posture of every protocol built on top of it.

02.Did the crypto developer count fall in 2023?

Yes. Electric Capital's 2023 Developer Report recorded a 24 percent year over year decline in monthly active open source crypto developers, with Ethereum specifically falling to 7,864 monthly active developers, a 25 percent drop. The decline concentrated in newcomer developers, who fell 48 percent, while mature developers who had already shipped production code grew 7 percent, a composition shift allocators should read as consolidation, not collapse.

03.What is the difference between Foundry and Hardhat for due diligence purposes?

Foundry, released by Paradigm in December 2021, is a Rust-based toolkit that lets developers write tests directly in Solidity for a faster feedback loop. Hardhat, maintained by the Nomic Foundation, is a JavaScript and TypeScript based environment with a long-established plugin ecosystem. Neither tool is inherently safer; allocators should treat the presence of either as a baseline signal of engineering discipline, then verify actual test coverage and audit history independently.

04.What regulation applies to teams building on this tooling in the European Union?

The Markets in Crypto-Assets Regulation, Regulation 2023/1114, entered into force in the European Union on 29 June 2023, with the crypto-asset service provider authorisation regime becoming applicable from 30 December 2024. Teams using Foundry or Hardhat to build products that will serve EU residents fall within its scope once that later date arrives, regardless of which tooling stack they chose.