The Crypto Market Cap Declined by 10% in Q3 2023
The cryptocurrency market capitalization experienced a 10% decrease, equivalent to $119 billion, in the third quarter of 2023 compared to the previous quarter, according to CoinGecko’s 2023 Q3 Crypto Industry Report. During this period, spot trading volumes on centralized exchanges also declined by 20.1%. Additionally, major stablecoins witnessed a significant drop in market cap.
Losses for USDC and BUSD
Among stablecoins, USDC suffered the largest absolute losses of -$2.26 billion, while BUSD experienced the largest percentage decline of -45.3%, resulting in a drop of -$1.87 billion, as reported by CoinGecko.
TradFi and DeFi Convergence
CoinGecko co-founder Bobby Ong expressed optimism despite the sluggish crypto market performance in Q3. He noted that there are signs indicating the convergence of traditional finance (TradFi) and decentralized finance (DeFi).
The Impact of Mid-August Liquidations
The report highlighted August 17 as a significant day that divided the relatively slow Q3 into two parts. On this day, the value of Bitcoin plummeted from approximately $29,000 to around $26,000. The resulting liquidation event wiped out over $821 million worth of long positions within just 24 hours.
Changes in Market Capitalization Rankings
During Q3, Solana climbed from the 10th position to secure the 7th spot in market capitalization rankings. TrueUSD also made progress, moving up from the 23rd position to the 19th. However, Litecoin dropped from 9th to 14th place, and BUSD experienced a further decline from 18th to 27th position.
Lack of Momentum in the Crypto Market
Despite the eventful three months, the crypto market lacked significant momentum, according to the analysts behind the CoinGecko report.
Hot Take: Mixed Results for the Crypto Market in Q3 2023
The third quarter of 2023 brought mixed results for the cryptocurrency market. While there was a significant decline in market capitalization and spot trading volumes, there were also indications of convergence between traditional finance and decentralized finance. The impact of mid-August liquidations caused a notable dip in Bitcoin’s value and wiped out a substantial amount of long positions. Changes in market capitalization rankings saw Solana and TrueUSD making progress while Litecoin and BUSD faced declines. Overall, despite being an eventful period, the crypto market struggled to gain momentum.
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