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In the midst of a tumultuous year, major economic disruptions and historic volatility have centered the spotlight on Bitcoin, which is poised to enter the mainstream in a way we’ve never seen before. Here are some top trends we witnessed at Binance in what’s shaped up to be a groundbreaking year for crypto.
In 2020, worldwide markets faced unprecedented volatility, while the economic recovery in many countries has been K-shaped, delivering a financial blow to already-vulnerable communities. With traditional financial systems under stress, retail users and institutions turned to cryptocurrencies en masse, driving the crypto markets to new heights.
Expanding crypto market cap signals influx in capital and interest
This year alone, the total market cap of all cryptocurrencies grew rapidly, from approximately $193 billion on January 1, 2020 to $641 billion at the time of writing. Much of this year’s market cap expansion can be attributed to Bitcoin, as traders rushed to buy Bitcoin as a hedge against inflation.
Bitcoin (BTC) repeatedly broke new all-time highs in late November and December, reaching $24,298 on December 20, 2020, while users turned away from gold in large numbers, prompting many to consider whether Bitcoin is a better store of value and inflation hedge.
Bitcoin is still on top, but altcoins take a step forward
As of December 21, 2020
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Bitcoin (BTC) makes up 66% of the total market cap of all cryptocurrencies
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Ether (ETH) follows at 11%, while XRP falls to 4%
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Though Bitcoin (BTC) remains king, Ether (ETH) also posted impressive growth in 2020, thanks in part to the rise in DeFi and the proliferation of popular decentralized apps (DApps) built to run on the Ethereum network
Mainstream institutions are getting into crypto – with mass adoption to follow?
The influx of capital into crypto markets comes during a time of economic tumult and marks an important shift in the public’s perception of cryptocurrencies. Rather than being seen as a speculative asset for those looking for eye-popping returns, cryptocurrencies now maintain a much broader appeal.
As activity in the crypto markets concentrated around cryptocurrency exchanges, we experienced record-high traffic volumes throughout the year.
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Total trading volume*: over 3.0 trillion USDT
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All-time high trading volume* (24-Hour): over 52.6 billion USDT
* Across spot, futures, options, margin, and leveraged tokens
Asia continues to be a dominant crypto market, consistently posting the highest trading volumes, with Europe following closely behind. With high awareness and adoption rates among the general public, it’s clear why Asia maintains a large share of global crypto trading volumes.
Amidst a booming crypto market, crypto-derivatives gain steam
Top futures trading pairs (by volume) in 2020 include
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BTC/USDT
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ETH/USDT
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LINK/USDT
Most traded leveraged tokens by volume
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LINKDOWN/USDT
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XRPUP/USDT
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XRPDOWN/USDT
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LINKUP/USDT
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BTCDOWN/USDT
When it comes to both spot and futures markets, Bitcoin (BTC/USDT) was the trading pair on everybody’s watchlist with BTC/USDT trades accounting for more than 25% of total spot trading volume.
The most popular cryptocurrency trading pairs on spot markets (by volume) include
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BTC/USDT
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ETH/USDT
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ETH/BTC
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XRP/USDT
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BTC/BUSD
Top three most popular cryptocurrencies to hold (based on USDT equivalent in spot wallets)
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Bitcoin (BTC)
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BNB
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Ether (ETH)
The most traded tokens on OTC
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Bitcoin (BTC)
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Ether (ETH)
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XRP
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BNB
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Cardano (ADA)
Peer-to-peer (P2P) trading remains a popular option for those looking to send and receive low cost, cross-border remittances.
Regions that topped the list based on P2P trading activity
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Asia
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Africa
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Eastern Europe
The top regions for buying and selling crypto using fiat currencies
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The UK and Europe
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Russia and CIS
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Africa
Cryptocurrency lending is one of the crypto industry’s fastest growing segments, and has proven to be a hit with crypto owners looking for an additional source of income. Anyone with eligible crypto assets can “subscribe” their assets in exchange for a fixed interest rate.
Crypto loans often carry attractive, double-digit interest rates, far higher than those seen on traditional loans. The market for crypto loans has increased steadily throughout the year and poses an intriguing alternative to traditional banking.
The top five most popular tokens for crypto loans by total trades
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USDT
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BUSD
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KAVA
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SXP
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NEO
A breakthrough year for crypto
This has been one of the most important years on record for the blockchain and crypto landscape. Strong interest in crypto from everyday users and institutions alike have resulted in an influx of attention and capital, despite the global pandemic.
With crypto adoption picking up speed, Bitcoin’s price repeatedly broke all-time highs, becoming one of the best performing assets of the year. At the same time, crypto and DeFi infrastructure continues to mature at a rapid pace, while the booming market for stablecoins and DeFi borrowing and lending protocols have sparked new avenues for growth. After a tough year for many, the future of crypto is one of the rare bright spots that give us hope in the coming year.
You can check out the full report here.
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Anna Berdnik/Yevhen Vitte/greenbutterfly
