Iris Coleman
16 July 2024 15:57
According to Binance Research, the cryptocurrency market is expected to grow by 37.3% in the first half of 2024, driven by the strong performance of Layer-1s, DeFi, and stablecoins.
According to Binance Research, the total cryptocurrency market capitalization surged by 37.3% in the first half of 2024, ending the period at around $2.27 trillion. The growth was mainly concentrated in the first quarter, which saw a notable increase of 60.2%. However, the second quarter experienced a more difficult environment, with a decline of 14.3%.
1st tier takes the lead
Layer 1 blockchains (L1) have had a strong start to the year. Bitcoin (BTC) continued to gain market dominance following the fourth halving, the launch of the Loon protocol, and the approval of a US spot ETF that attracted over $14 billion in inflows. Ethereum (ETH) also experienced significant developments, including a re-staking explosion and the EIP-4844 update. BNB Chain focused on opBNB and greenfield projects, while Solana (SOL) emerged as a force in the mimecoin space, launching Blockchain Link (Blink).
Strengthening the 2nd layer ecosystem with airdrops
The first half of 2024 saw a surge in airdrops within the Layer-2 (L2) ecosystem, particularly for zero-knowledge (zk) projects. Incentive pledges led to significant capital inflows, driving the total value locked (TVL) in L2 up 90% to $43 billion in just six months.
DeFi and Stablecoins See Significant Growth
Decentralized finance (DeFi) has also seen significant capital inflows, with TVL growing 72.8% from $54.4 billion at the start of the year to $94.1 billion. This growth has benefited a variety of DeFi sectors, bringing previously inaccessible financial primitives on-chain.
The stablecoin market has taken a big turnaround, approaching its peak in April 2022. As of June 30, 2024, the market cap of stablecoins reached $161 billion, the highest in two years. While Tether’s USDT still dominates, Circle’s USDC and Ethena’s USDe have gained market share.
NFT and SocialFi Development
The NFT market has been in turmoil, with sales declining and major projects seeing their floor prices drop by more than 50%. However, platforms like Blur and projects like Pudgy Penguins and Bitcoin NFTs have continued to gain traction.
SocialFi also saw notable developments. Lens Protocol announced its upcoming zk chain Lens Network, Farcaster saw user growth after the launch of Frames, Friend.tech launched its token and v2, and Fantasy.top’s trading card game gained popularity.
Web3 Games and Others
Web3 games had a strong first quarter, but faced difficulties in Q2 as the market cap of project tokens declined. Nevertheless, user growth remained strong, with projects like Pixels and Hamster Kombat attracting large numbers of players.
Other areas of interest include Mimecoin, Artificial Intelligence (AI), and Decentralized Physical Infrastructure Networks (DePIN), which have consistently generated significant interest from investors and the wider community.
Looking ahead to the second half of 2024, Binance Research has highlighted six key themes that are expected to make progress across a variety of areas, including macro, Bitcoin ecosystem, ownership economy applications, and real-world assets (RWAs).
For the full report, visit Binance Research.
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