In a remarkable turnaround, Bitcoin has experienced a surge of over 160% in 2023, marking a significant rebound from the gloom that engulfed the crypto markets in late 2022, following a $1.5 trillion wipeout. This resurgence has spurred avarice among investors, with smaller tokens like Solana and various memecoins gaining traction. Notably, those who invested in Solana at the beginning of the year have witnessed substantial gains, with an initial $100,000 investment now exceeding $800,000.
A key driver behind this crypto bonanza is the optimism surrounding the potential approval of the first Bitcoin exchange-traded fund (ETF) by US regulators. The decision, expected by January 10, is considered by crypto enthusiasts as a catalyst for a “demand shock,” offering mainstream investors a compliant investment channel for the token.
Despite the positive momentum, the crypto market still faces skepticism from detractors who argue cryptocurrencies are inherently worthless and attract criminal activity. Recent legal issues, such as Binance’s hefty fine and the legal troubles of figures like Sam Bankman-Fried, contribute to this skepticism.
Charts depicting the crypto landscape in 2023 reveal Bitcoin’s rally surpassing stocks and gold, with supporters anticipating a positive impact from the quadrennial halving event in 2024. Additionally, Bitcoin derivatives, decentralized finance, and nonfungible tokens (NFTs) have seen notable developments, with liquid staking and growing interest in Bitcoin options and futures.
The crypto market, however, bears scars from the collapse of FTX platform and Alameda Research in November 2022, impacting liquidity and making Bitcoin harder to trade. Market depth data highlights the challenge, with a significant drop in the daily value of trades within 1% of the mid-price of Bitcoin on centralized exchanges.
Furthermore, shifts in market share among crypto exchanges have been observed, with Binance maintaining its position as the largest venue but facing a decline in spot trading share. Asian-focused platforms like Upbit, Bybit, and OKX have gained business, indicating changing dynamics in the crypto exchange landscape.
