- Bitcoin dominated the cryptocurrency world in the first half of 2023 and reached its highest level of dominance since April 2021.
- Bitcoin significantly outperformed traditional financial market investments, showing an 87% price increase.
- Despite industry challenges, the crypto market demonstrated resilience, and the total cryptocurrency market value completed the half-year on a positive note.
Binance has released a report on the first half of 2023, highlighting Bitcoin’s supremacy over traditional financial investment instruments.
Binance’s Half-Year Report Released
In the first half of 2023, Bitcoin dominated the cryptocurrency world and, as recorded in Binance’s latest Half-Year report, reached its highest level of dominance since April 2021.
Bitcoin ended the half-year with the highest market dominance since April 2021, significantly outperforming traditional financial market investments with an 87% price increase. Among these changing trends, observing the unique dynamics of Bitcoin’s relationship with traditional finance is interesting, as it reached some of the lowest correlation levels in years. The report also mentioned Ordinals and Inscriptions:
“Ordinals and Inscriptions have echoed with new energy in the wider Bitcoin ecosystem, and we expect to see continuous development and innovation in the coming months.”
Despite industry challenges, the crypto market demonstrated resilience. The total cryptocurrency market value completed the half-year on a positive note, and a significant portion of it was supported by Bitcoin’s strong performance. Waves of new energy in the Bitcoin ecosystem promise exciting innovations and growth in the future.
Layered solutions did not stand idle during this period. Ethereum’s liquid staking increased, paving the way for Liquid Staking DeFi, and Binance Smart Chain (BNB Chain) focused on scalability development. Among these events, Solana managed to leave a challenging 2022 behind, launching its Web3 phone and reclaiming its position on the competitive stage.
Notable developments in DeFi emerged since the beginning of 2023, and a significant part of it was attributed to the remarkable rise of liquid staking and increasing migration of users to decentralized exchanges (DEXs). While the sector continues to explore new use cases, DeFi’s dominance decreased by 0.5% compared to the global crypto market.
Despite a 7% decrease in the global stablecoin market value, there were significant changes in the sector’s market structure. For instance, USDT recorded a striking 25.8% increase in market share. At the same time, DeFi experienced some significant developments, particularly with the rise of liquid staking and users’ migration to decentralized exchanges (DEXs).
Bitcoin Fear and Greed Index
Metrics related to Bitcoin sentiment analysis were also examined in this report. These metrics provide information on market participants and the general public’s common attitudes towards Bitcoin.
The Bitcoin Fear and Greed Index is a popular sentiment indicator used to measure market attitudes and investor psychology towards major cryptocurrencies like Bitcoin. It provides values between 0 and 100, with values below 50 representing “fear” periods and values above 50 representing “greed” periods. This calculation takes into account various factors and data points such as market dominance, trading volume, Google trends, social media sentiment, price volatility, etc.
As seen in the visual below, this metric has fluctuated over the past six months but has generally risen from the mid-20s to the mid-50s. While not a definitive measure, this indicates an overall bullish sentiment towards Bitcoin throughout the year and can be interpreted as a generally positive movement. In fact, the index has mostly fluctuated between 45 and 65 since February (when Ordinals and Inscriptions began to gain popularity), indicating an overall positive sentiment towards Bitcoin for most of this year.
NFTs and Gaming Tokens
NFTs experienced an increase in transaction volume supported by increased activity in the Blur market. However, they did not perform as well in the broader crypto market, and the base prices of many NFT collections have decreased year-to-date. On the other hand, gaming-related tokens experienced price increases, benefiting from the wider market recovery.
Meanwhile, the investment scene showed a contraction in cryptocurrency transactions and venture capital funding. However, infrastructure investments were a shining sign, attracting most of the major investments, followed by the gaming/entertainment and DeFi sectors.
