Binance Research has released its comprehensive report for the first half of 2024, highlighting significant developments and growth in the cryptocurrency market. The report reveals a 37.3% increase in total crypto market capitalization, reaching approximately $2.27 trillion. This surge was driven by robust performances in the DeFi sector, Layer-2 solutions, and the dominance of Layer-1s like Bitcoin and Ethereum. Despite facing challenges in the second quarter, the market's overall trend remains positive, paving the way for further advancements in the latter half of the year.
Layer-1 Developments
Layer-1s (L1s) experienced a strong start to the year:
Bitcoin: Continued to gain market dominance after the fourth Bitcoin Halving, the launch of the Runes Protocol, and the approval of U.S. spot ETFs, which have attracted over US$14 billion in inflows.
Ethereum: Experienced a restaking explosion and implemented the EIP-4844 update.
BNB Chain: Continued development on opBNB and Greenfield.
Solana: Excelled in the memecoin space and launched blockchain links ("blinks").
Layer-2 Developments
The first half of 2024 was marked by significant activity in the Layer-2 (L2) space, particularly among zero-knowledge (zk) projects. Incentive programs led to substantial capital inflows, increasing the total value locked (TVL) in L2s by 90% to US$43 billion.
Decentralized Finance (DeFi)
DeFi saw a substantial influx of capital, driving TVL up 72.8% YTD to US$94.1 billion, from US$54.4 billion at the start of the year. This growth benefited nearly every DeFi sector, bringing previously inaccessible financial primitives on-chain.
Stablecoins
The stablecoin market experienced a notable turnaround, nearing its peak from April 2022, just before the TerraUSD (UST) crash. As of June 30, 2024, the stablecoin market capitalization reached US$161 billion, a 2-year high. Tether's USDT continues to dominate, while Circle's USDC and Ethena's USDe gained market share.
NFT Market
NFTs faced turbulence in H1 2024, with declining sales volumes and major projects seeing over 50% drops in floor prices. Despite this, Blur maintained dominance, spurred by the Blast token airdrop, and Pudgy Penguins found success with their physical toys. Bitcoin NFTs also continued to shine.
SocialFi
SocialFi saw continued development:
Lens Protocol: Announced their upcoming zk chain, Lens Network.
Farcaster: Experienced user growth following the launch of Frames.
friend.tech: Released their token and v2.
Fantasy.top: Trading card game highlighted notable success.
Web3 Gaming
The Web3 gaming sector had a strong Q1, but tokens for gaming projects fell significantly in Q2 alongside the broader altcoin market. Despite falling prices, user growth metrics improved, with projects like Pixels and Hamster Kombat attracting large numbers of players through token airdrops.
Emerging Sectors
Notable emerging sectors include memecoins, artificial intelligence (AI), and decentralized physical infrastructure networks (DePIN). These areas continued to attract strong interest from investors and the broader community in H1 2024.
Outlook for H2 2024
Moving into the second half of 2024, Binance Research is excited about six key themes expected to see significant progress:
Macro Environment: Anticipated impacts from global economic shifts.
Bitcoin Ecosystem: Continued development and potential new protocols.
Ownership Economy Applications: Innovations in digital ownership and tokenization.
Real-World Assets (RWAs): Integration of real-world assets into blockchain ecosystems.
Decentralized Finance (DeFi): Expansion and maturation of DeFi protocols.
SocialFi and Gaming: Continued growth in social financial platforms and blockchain-based gaming.
These themes represent a broad array of narratives and sectors, each poised to drive further innovation and adoption in the cryptocurrency space.
