In Q1 2023, the crypto market capitalization was $1.2 trillion, showing a 48.9% growth compared to the 2022 figures. Bitcoin outperformed other assets, showing a 72.4% increase.
According to CoinGecko’s quarterly market report, the total crypto market cap rose by half to $1.2 trillion in Q1 2023, a $406 billion gain from the end of 2022.
Analysts also noted that the average daily trading volume increased by 30% to an average of $77 billion in Q1 2023. The trading volume began rising in January, but the biggest surge was recorded in March. CoinGecko analysts believe that the growth in the crypto market’s trading volume was primarily due to increased volatility caused by the banking meltdown in the United States. However, by late March, the figure fell because Binance suspended its zero-fee trading program.
Additionally, the report noted that Bitcoin showed a 72.4% growth in Q1 2023. The first cryptocurrency outperformed all traditional asset classes, most of which also finished the quarter in the green zone. For example, the NASDAQ index saw a gain of 15.7%, while gold rose by 8.4%.
Meanwhile, the stablecoin market wasn’t at its highest in 2023. In total, the capitalization of the fifteen largest stablecoins decreased by 4.5% in Q1, losing $6.2 billion. The largest losses were suffered by Binance USD (BUSD), which lost 54.5% of its cap due to the forced suspension of coin issuance at the request of U.S. regulators. USD Coin (USDC), which temporarily lost its peg to the dollar because of the Silicon Valley Bank bankruptcy, saw its value shrink by 26.9%. At the same time, Tether (USDT) strengthened its market position, increasing its market cap by 20.5% to $13.6 billion.
The total capitalization of the DeFi sector increased to $29.6 billion, showing a 65.2% growth in Q1 2023. The main driver for the sector was liquid staking protocols, which showed an increase of 210.9% due to active preparation for the Shapella upgrade on Ethereum.
The trading volume of NFTs in Q1 2023 also surged, increasing by 68% to $4.5 billion. More than 70% of NFT trading volume came from the Blur marketplace, a major competitor to OpenSea, which significantly reduced its market share.
Analysts at CoinGecko noted that total trading volume on cryptocurrency exchanges rose by 18.1% to $2.8 trillion in Q1 2023, with DEXs outpacing CEXs in terms of growth, as centralized exchanges are experiencing significant difficulties due to regulatory pressure. Thus, the trading volume on DEXs in Q1 2023 increased by 33.4%, while this figure was higher on CEXs by only 16.9% than in the previous period.
The U.S. Securities and Exchange Commission (SEC) filed lawsuits against several major cryptocurrency exchanges within a few months of this year. Binance, Kraken, Coinbase, and Bittrex were among the SEC’s “victims.”
