As we bid farewell to 2023, the cryptocurrency world is already buzzing with significant advancements in the new year.
On January 10th, the United States Securities and Exchange Commission made history by approving 11 spot Bitcoin exchange-traded funds (ETFs). In just one week of trading, these ETFs surpassed silver exchange-traded products, propelling Bitcoin (BTC) to become the second-largest exchange-traded commodity in terms of volume.
The introduction of spot Bitcoin ETFs has sparked discussions about the potential for similar ETFs for other cryptocurrencies. Combined with the upcoming Bitcoin halving in April, there is a prevailing sense of confidence across various sectors, creating an atmosphere of optimism regarding future price increases and value growth.
The latest edition of Cointelegraph Research’s “Investor Insights” report for February explores how the industry has responded to the launch of spot Bitcoin ETFs in the United States. The report covers a wide range of sectors, including crypto-mining businesses, derivatives markets, the decentralized finance (DeFi) sector, and real-world asset tokenization, among others. It provides a comprehensive overview of each segment, offering in-depth analysis, future projections, and sentiment analysis.
You can download a free PDF of the report from the Cointelegraph Research Terminal.
In January, the DeFi market experienced significant growth, mirroring the broader cryptocurrency market’s volatility, excitement, and unpredictability. However, it also faced a surprise security breach that affected the Socket protocol, resulting in the theft of $3.3 million worth of Ether (ETH). The Socket protocol team swiftly addressed the vulnerability, and with the help of various analytics firms, around 70% of the stolen funds were recovered within a week, offering reassurance to affected stakeholders.
While the total value locked (TVL) in DeFi projects and the price of their tokens initially saw an increase at the beginning of the month, there was a noticeable slowdown in the latter half. However, Sui and PulseChain stood out with remarkable TVL growth, surging by 107% and 189%, respectively. PulseChain’s value increase can be attributed to the expansion of its native decentralized exchange, PulseX, which saw the transfer of over 20 million Dai (DAI) stablecoins from Ethereum to PulseChain in less than a week.
On the other hand, Sui’s TVL growth is linked to the rising popularity of two lending protocols, Navi Protocol (162% growth) and Scallop (229% growth). The launch of Scallop’s second phase of its airdrop and rewards program on January 16th contributed to a doubling of the protocol’s TVL.
In terms of derivatives trading, regulatory challenges have exposed vulnerabilities as bulls deleverage. Throughout 2023, varying regulations across countries and regions, along with strict regulatory measures, have significantly limited retail derivatives trading globally. Centralized exchanges and DeFi projects have had to halt their operations due to the increasing difficulty of acquiring trading licenses for various products.
Major industry players like Crypto.com and Binance have been forced to scale down their services, reduce leverage ratios, limit product availability, and restrict access for certain users. Despite these challenges, the derivatives markets remain a crucial indicator of sentiment within the industry.
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