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In January 2023, ViaBTC Capital and CoinEx jointly published the 2022 Crypto Annual Report to offer data analysis and insights on nine sectors, including Bitcoin, Ethereum, Stablecoins, NFTs, Public Chains, DeFi, SocialFi, GameFi, and regulatory policies. . This report also predicts the crypto trend in 2023.
Affected by factors such as the macro environment and the bull-to-bear transition, the entire cryptocurrency industry turned bearish in 2022, according to the report. In particular, following the Terra crash in May, most cryptocurrency sectors are were affected by the bearish impact. Below is the overview of each segment.
1.Bitcoin
In 2022, Bitcoin’s overall performance remained sluggish, with significant drops in price and trading volume compared to 2021. The price at the end of 2022 even fell below the peak of the last bull market. Bitcoin’s price trend throughout the year is obviously influenced by the pace of US interest rate hikes, but as the US interest rate hike policy continues to advance, its impact on the bitcoin price gradually diminishes. About BTC Mining, network difficulty remained at an all-time high. Meanwhile, mining revenues plummeted and miners had to shut down their old models. Affected by multiple factors, the mining industry experienced a strong crowding-out effect, driving small-scale mining owners out of the market for various reasons. At the same time, long-established mining trusts and mining farms managed to maintain a certain level of stability.
2. Ethereal
Ethereum’s primary statistics trended lower in 2022. In addition to secondary market price and transaction volume, on-chain data including TVL, transaction cost, active address, and burn volume also plummeted. Despite that, the network made great progress in 2022. On September 15, Ethereum completed the historic transition from PoW to PoS. The merger significantly reduced energy consumption and daily production from the grid, thus reducing dumping pressure from secondary markets. Meanwhile, Layer 2 projects like Arbitrum, Optimism, zkSync, and Starknet launched their mainnet in whole or in part. Although its daily transaction volume was much lower than that of the Ethereum mainnet, the projects outperformed Ethereum in terms of the number of addresses. Also, their gas fee was usually 1/40 of that charged by Ethereum. At the same time, the network also experienced an exponential increase in gas rates during 2022.
3. Stablecoins
The stablecoin market as a whole was flat in 2022. Specifically, over the year, stablecoin supply fell from $157 billion to $148 billion, a 6% drop. In this sense, the fall was not substantial. Regarding centralized stablecoins, USDT maintained its dominance, while BUSD is growing rapidly thanks to Binance. In contrast, algorithmic stablecoins were hit hard by the LUNA crash, which shattered faith in decentralized stablecoins and reduced trading volumes. As a result, there was a clear drop in the number of new decentralized stablecoins.
4. Public chains
Despite difficult market conditions in 2022, public broadcasters remained a competitive sector. Due to the flood of demand caused by the congestion of the Ethereum network, the new low-fee public chain maintained a brilliant performance before May. However, as various bad news brewed and fermented, a series of bankruptcies followed one after another. Many public chains were hit hard and the crash was even worse than that of Ethereum. In May, Terra crashed in just a few days, becoming the first known public network to go down. Furthermore, the collapse of Terra was also a sign that the market turned completely bearish. In November, hit by the fall of FTX and Alameda Research, the token price of Solana and TVL plunged again, and projects within their ecosystem were affected as well. Other new networks, like Fantom and Avalanche, were also in trouble. At the same time, several new public chains, including Layer 2 projects like Arbitrum and Optimism and Meta-related chains like Aptos and Sui, debuted in 2022.
5.NFTs
Last year, the NFT sector waned after its initial boom. In April, the NFT market capitalization hit $4.15 billion, an all-time high; In May, fueled by the rise of Otherside, a metaverse NFT collection developed by Yuga Labs, the sector’s trading volume hit a record $3.668 million. But soon after, when the NFT market turned sluggish, the trading volume decreased. Meanwhile, the price of top-of-the-line NFTs, as well as the ETH price, plummeted, which negatively affected the market. On the other hand, the number of NFT holders continued to grow and reached an all-time high in December.
6. DeFi
DeFi’s TVL also trended downward in 2022. Notably, during the LUNA/UST crash in May, major coins witnessed the most spectacular drop in cryptocurrency history, followed by a TVL collapse. . Furthermore, during the year, DeFi also suffered from frequent attacks, raising security concerns for DeFi. In terms of innovation, while the first two quarters of 2022 saw hype trends about DeFi 2.0 from time to time, along with the OHM crash and the meme (3, 3), DeFi 2.0 almost proved to be a completely false narrative, and the The market turned its attention back to DeFi 1.0 infrastructure projects like Uniswap, Aave, and MakerDAO. Despite the bearish conditions, major DeFi projects including AAVE and Compound managed to maintain stable operations and attracted many new users of certain CeFi projects (eg Celsius and FTX).
7.SocialFi
In 2022, the blockchain industry continued to explore new possibilities for SocialFi. Throughout the year, we saw the emergence of iconic terms like Fan Token, Soulbound Token (SBT), Web3 Social, and Decentralized Identity (DID), but the PMF (Product-Market Fit) was never identified. Despite that, SocialFi still managed to introduce us to a number of flagship projects, including the Web3 STEPN lifestyle app with elements of SocialFi, the Galxe credential network, bnb The SPACE ID chain domain name service, the Social Graph Lens Protocol, and the Web3 Hooked Protocol gamified social learning platform. Other than that, the Qatar 2022 World Cup also helped Fan Tokens to attract a lot of attention from the market. As a result, instead of plummeting due to the bearish shock, Fan Tokens also performed slightly better in 2022 than in 2021.
8.GameFi
2022 was also the beginning of the GameFi bear. There was no significant innovation in the P2E blockchain game model. As user growth and trading volumes declined, institutional investors looked away from the P2E model. In the first half of the year, the Move-2-Earn model created by STEPN garnered attention with its innovative dual approach to tokenomics and marketing, bringing new dynamics to GameFi. Last year, blockchain projects raised the most funds in April, with blockchain investments totaling $6.62 billion. However, the market did not respond to other project teams focused on the reality plus token model. As the multi-chain ecosystem gained popularity, Ethereum maintained its dominance in the GameFi ecosystem, but the growth rate of projects on Ethereum failed to match that of bnb Chain and polygon. Also, most networks were heavily reliant on their top projects, and there were still plenty of low-quality GameFi projects with a small user base, lackluster interactions, and low business volumes.
9. Regulatory policies
Generally speaking, for the cryptocurrency industry, 2022 was full of ups and downs, but the regulations are headed in the right direction. Over the past year, regulators in the developed world have made great progress. The United States launched a regulatory framework for cryptocurrencies; the European Union initially approved the MiCA Law and the TFR Law; the United Kingdom and South Korea made progress in establishing the relevant organizations; Russia and Hong Kong promoted the discussion and implementation of policies for the mining of cryptocurrencies and values of virtual assets. The turbulence that occurred in the cryptocurrency industry in 2022 was partly the result of the sharp fall in funds and partly the result of regulatory loopholes and crackdowns. Last year, the bankruptcy of Terra and FTX, two major cryptocurrency projects, prompted national regulators and law enforcement agencies to further enhance their supervision and investigations of cryptocurrencies.
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