Author: DWF Ventures
Compiled by: Deep Tide TechFlow
2024 became a key turning point for cryptocurrency development—from the active participation of institutional investors to a significant increase in on-chain activities, this year showcased important advancements in the industry.
Here is a review of the data for this year:
Continuation of growth in 2023
The market has rebounded strongly this year, with the total market capitalization exceeding the historical high (ATH) of 2021, reaching $3.7 trillion.
In addition to a significant increase in liquidity, the number of users and trading volume have also grown in tandem—these data indicate the healthy development of the market and increased actual usage rates.
Inflow of ETFs and institutional funds
One of the biggest market drivers in 2024 is the Bitcoin ETF launched in January and the Ethereum ETF launched in July. These financial products not only lower the barrier for investors to enter the crypto market but also reflect the rapidly growing demand for crypto assets among traditional investors.
It is estimated that the total on-chain holdings of Bitcoin ETFs have grown to 1.1 million BTC, doubling since the beginning of the year.
Not only companies in the crypto space, but many traditional enterprises are also continuously increasing their investments in Bitcoin and other crypto assets. For example, @MicroStrategy, led by Saylor, continues to increase its Bitcoin holdings, which have now reached 439,000 BTC.
The potential of stablecoins
Stablecoins are a core tool in the cryptocurrency ecosystem; they not only enable rapid exchanges between assets but are also seen as an important indicator of new capital inflows.
In 2024, the total supply of stablecoins reached $187.5 billion, setting a new historical high. Meanwhile, the number of transactions and trading volume of stablecoins grew by 30%-40%.
It is worth noting that even during market fluctuations, the trading volume of stablecoins remains at a high level—indicating that stablecoins have significant practical applications beyond trading.
In terms of on-chain stablecoin trading volume, @trondao, @ethereum, @BNBCHAIN, and @solana continue to dominate. Meanwhile, L2 networks like @arbitrum and @base are also showing strong momentum in USDC trading volume and user growth.
Although trading activity on centralized exchanges (CEX) still leads decentralized exchanges (DEX) at present, this pattern is changing.
@BlackRock and @ethena_labs recently launched the USDtb product, providing a safe and convenient way for traditional funds to enter DeFi. With the emergence of these regulated gateways, we may see more funds flowing into the on-chain ecosystem in the future.
The rise of the stablecoin market in Latin America and Africa
In the past year, the stablecoin market in Latin America and Africa has grown by 40%-50%. There is a strong demand in these regions for currency hedging tools that do not require third-party trust, leading to rapid development of the stablecoin market here.
More and more resources are flowing into these regions, such as the educational programs launched by @Tether_to and @circle's expansion plans for payment services in Latin America. Therefore, we expect this sector to continue to maintain strong growth momentum in 2025.
Trends in on-chain activities
L2 networks (such as @base, @arbitrum, and @Optimism) and non-EVM chains like @solana have performed prominently in this year's net capital inflow. Users are increasingly inclined to choose blockchain networks with lower transaction fees and faster speeds, thus attracting more users.
The fastest-growing sectors are perpetual contracts and decentralized exchanges (DEX). Trading volume in these two areas has increased by over 150%, and total locked value (TVL) has also achieved a 2-3 times increase. The memecoin craze triggered by @pumpdotfun has greatly boosted trading volume, with @RaydiumProtocol being one of the major beneficiaries, also fostering the development of other ecosystems. Moreover, this trend has led to the widespread use of trading bots (such as @tradewithPhoton and @bonkbot_io). These bots not only have a high frequency of use but have also become one of the protocols with the highest fee income in the current crypto industry.
Nevertheless, there remains significant growth potential in on-chain activities. Currently, only 5%-10% of cryptocurrency holders are actively participating in on-chain operations, indicating a large untapped user base.
Mobile-friendly interfaces (such as TON's mini apps) have already achieved significant results in user growth. For example, the mini applications of @ton_blockchain have successfully attracted over 50 million users. Therefore, the future development of protocols will increasingly rely on mechanisms that optimize user experience (UX) and improve user retention rates.
