Nikolas Sargeant
Binance, the world’s largest cryptocurrency, has released its half-year report detailing the health of the crypto industry.
The cryptocurrency exchange released the report at the close of the first half of 2021. The 120-page report covers key industry verticals, including Bitcoin and layer-1s; layer-2s; stablecoins; DeFi; and NFTs. it also looked at other areas of the crypto ecosystem, including, gaming, metaverse, funding, and institutional adoption.
The mid-year report revealed the state of adoption, usage, and innovation in every major category.
Here are some important observations from the report;
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Total market capitalization has risen by 30% on a year-on-year basis, closing at $1.17T on June 30.
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Bitcoin dominance ended the half-year at its highest level since April 2021, while its correlation with TradFi is now at a three-year low.
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Despite a 7% decline in global stablecoin market value, USDT has experienced a 26% increase in market share year-to-date (“YtD”).
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Liquid staking has become the largest DeFi sector.
The report also revealed some metrics that aren’t immediately apparent to day traders but have contributed to the growth of the broader market. An example of this is that Bitcoin trading volume rose by 185% year-to-date. Furthermore, network transactions have increased by 58%, while average transactions fees are up by 143% since the start of the year. The surge in Bitcoin network usage has been partially attributed to the growth of Ordinals that allow NFTs to be launched and traded on the blockchain.
Bitcoin Mining Difficulty On The Rise
The report also revealed that the hashrate used to secure the Bitcoin blockchain is also up 40% since January 2023. Furthermore, mining difficulty has also increased by 43% during that period.
The Binance Research team added that the Bitcoin Fear & Greed Index has doubled since January, showing increased trader confidence.
Looking at the layer-1 blockchains, Solana has been the best performer since the start of the year. Meanwhile, BNB Chain has the best network performance year-to-date, recording a 113% increase in daily transactions. This is far higher than the 48% recorded by Ethereum during that period.
Furthermore, BNB Chain also outperformed Ethereum in terms of active addresses year-to-date (118% vs. 63%).
An interesting trend so far this year is the growth in liquid staking and the emergence of LSTfi (the amalgamation of liquid staking tokens and DeFi). The report revealed that LSTfi grew by 460% in total value locked since April.
The report also looked into the layer-2 sector, especially the growth of zkEVMs and Polygon’s upcoming transition to Polygon 2.0.
The report pointed out that;
"The crypto industry's upward momentum is fueled by continuous innovation and expanding use cases. As digital assets gain more mainstream recognition, we observe the flourishing adoption of stablecoins and the growth of blockchain technologies. These developments, combined with the increasing involvement of institutional players and institutional adoption, lay a solid foundation for the industry's future growth and widespread acceptance."
Binance’s H1 report also examined the stablecoin market and the stablecoins that have gained market share so far this year. Stablecoins such as USDD, crvUSD, GHO and LUSD, have taken a substantial market share from USDT, BUSD, and other established stablecoins.
Looking at the broader crypto market, there has been substantial growth since the start of the year. In the DeFi space, users are up 43% year-to-date, while NFT trading volumes have increased compared to the second half of last year.
In terms of fundraising, Binance reports the top 10 funds raised a total of $3.6 billion in H1
The report concluded that the cryptocurrency market is looking bullish at the moment. Binance Research stated that;
“The market has largely benefited from the “Bitcoin ETF” season, driving the market’s newfound momentum as Bitcoin soared to new highs for the year, helping boost investor confidence. As we embark on the second half of the year, we look forward to seeing further innovations, greater adoption, and an even brighter future.”
Binance is the world’s leading blockchain ecosystem and cryptocurrency infrastructure provider with a financial product suite that includes the largest digital asset exchange by volume. Trusted by millions worldwide, the Binance platform is dedicated to increasing the freedom of money for users and features an unmatched portfolio of crypto products and offerings, including, trading and finance, education, data and research, social good, investment and incubation, decentralization and infrastructure solutions, and more.
Binance Research is the research arm of Binance, the world's leading cryptocurrency exchange. The team is committed to delivering objective, independent, and comprehensive analysis and aims to be the thought leader in the crypto space.
