The Year in Data: 5 Charts That Show How Crypto Changed in 2023
After a tumultuous 2022 for the crypto industry, 2023 provided some much-needed relief for its participants. The year was marked by several significant data trends that shaped the industry. Let’s take a look at five charts that illustrate how the crypto landscape changed in 2023.
GBTC’s Narrowing Discount to NAV
The Grayscale Bitcoin Trust (GBTC) discount fell to its lowest level in over two years in 2023. This narrowing trend is a result of increased optimism surrounding the approval of a spot bitcoin ETF in the U.S. GBTC’s discount to net asset value (NAV) is currently below 10%, signaling a positive outlook for the potential conversion of GBTC.
Binance’s Declining Market Share
Binance, one of the largest cryptocurrency exchanges, saw a decline in its market share in 2023. The company faced various legal and regulatory challenges, including criminal investigations and lawsuits in the U.S. and Europe. Binance’s market share among non-USD exchanges dropped from over 70% at the beginning of the year to around 46% by the end of 2023.
USDC’s Squeeze
USDC, a stablecoin issued by Circle, experienced a significant squeeze in 2023. The stablecoin started the year with a 32% share of the stablecoin market but faced a depegging from the U.S. dollar following Circle’s disclosure of holding reserves at a failed bank. This led to a sell-off and a drop in USDC’s market cap. USDT, issued by Tether, strengthened its dominance in the stablecoin market, reaching 71% of the total supply.
Bitcoin Helps Subdued NFT Sector Make a Comeback
Bitcoin, traditionally not known for its NFTs, saw a surge in NFT activity in 2023. The introduction of the Bitcoin Ordinals protocol made it easier to post fully on-chain NFTs on the Bitcoin blockchain. This innovation resulted in increased transaction volume on the Bitcoin network and a revival of the NFT sector. Bitcoin-based NFTs accounted for a significant portion of the NFT trading volume in 2023.
Crypto Market Bounces Back
The crypto market as a whole had a strong rebound in 2023. Bitcoin gained around 160% throughout the year, while Ether saw a 94% increase. Solana, one of the top ten cryptocurrencies by market cap, experienced a staggering 1000% growth. The DeFi sector also performed well, closing out the year with a 67% gain. These positive trends reflect renewed investor confidence in the crypto market.
Looking Ahead to 2024
Anticipation is building for the potential approval of a spot bitcoin ETF and the upcoming Bitcoin halving event in 2024. These events have the potential to further impact the crypto industry and shape its trajectory going forward. As we enter 2024, there is much to look forward to and many more developments to come in the evolving world of cryptocurrencies.
Disclaimer: The Block is an independent media outlet that delivers news, research, and data. The information provided in this article is for informational purposes only and should not be considered legal, tax, investment, financial, or other advice. All rights reserved.
About the Author
James Hunt is a reporter at The Block, based in the UK. He covers a wide range of topics in the crypto industry and keeps readers up to date with the latest news through The Daily newsletter. With a strong background in freelance writing and a deep understanding of the industry, James provides comprehensive coverage of various crypto-related subjects. You can reach James on Twitter or Telegram at @humanjets or via email at [email protected].
Editor
This article was edited by The Block’s editorial team to ensure accuracy and clarity.
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Analyst comment
Positive news: The Year in Data: 5 Charts That Show How Crypto Changed in 2023
As an analyst, I anticipate that the market will continue to show positive trends in 2024. The narrowing discount to NAV for GBTC suggests increased optimism for the conversion of GBTC. While Binance’s declining market share may have a short-term impact, the overall crypto market’s rebound, including Bitcoin’s surge in NFT activity and solid gains in Bitcoin, Ether, and Solana, reflect renewed investor confidence. Anticipation for the potential approval of a spot Bitcoin ETF and the upcoming Bitcoin halving event further adds to the positive outlook.
