Bitcoin ETF Surge and DeFi Growth Cryptocurrency 2024 Landscape Revealed

Author: Cointelegraph Research Translation: Shan Ouba, Golden Finance

As 2023 fades into the background, a new year has begun and cryptocurrencies have made significant developments.

On January 10, the U.S. Securities and Exchange Commission approved 11 spot Bitcoin exchange-traded funds (ETFs), which is an important event in the history of cryptocurrency. milestone. After just one week of trading, these ETFs have outperformed the silver exchange-traded product, making Bitcoin the second-largest exchange-traded commodity by trading volume.

The launch of a Bitcoin spot ETF has fueled speculation about the potential of other cryptocurrency spot ETFs. Coupled with the expected Bitcoin halving in April, various industries have strong confidence in potential price increases, thus increasing optimism about future value growth.

The February edition of Cointelegraph Research’s Investor Insights monthly trends report delves into the industry’s response to the launch of a spot Bitcoin ETF in the United States, covering Multiple areas, including cryptocurrency mining operations, derivatives markets, decentralized finance (DeFi) fields and real-world asset tokenization, etc.

The report provides a comprehensive overview of each segment, combining in-depth analysis, future forecasts and sentiment analysis to provide readers with an understanding of the current situation and expectations comprehensive summary.

The DeFi market grew strongly in January, but attacks offset some of the gains

In January, the decentralized finance (DeFi) space truly reflected the broader cryptocurrency market: volatility, excitement, and unpredictability. An unexpected security vulnerability affecting the Socket protocol resulted in the theft of $3.3 million worth of Ethereum.

Shortly after the incident, the Socket Protocol team quickly identified and fixed the vulnerability. Thanks to the combined efforts of various analytics firms, approximately 70% of the stolen funds were recovered within a week, providing significant assurance to affected stakeholders.

Although the total value locked (TVL) of DeFi projects and their token prices increased at the beginning of this month, they slowed down significantly in the second half of the year. However, Sui and PulseChain saw significant TVL growth, surging by 107% and 189% respectively. PulseChain’s significant growth in value can be attributed to the expansion of its native decentralized exchange PulseX, specifically the transfer of over 20 million Dai.

In less than a week, the stablecoin moved from Ethereum to PulseChain.

Meanwhile, Sui’s TVL growth has been linked to the growing popularity of two lending protocols, with Navi Protocol growing 162% and Scallop growing 229%. Scallop launched the second phase of its airdrop and rewards program on January 16, doubling the protocol’s TVL.

Regulatory challenges have led to a decline in leverage ratios and derivatives transactions are at risk

Looking at 2023, various There are large regulatory differences between countries and regions, coupled with strict regulatory measures, global retail derivatives trading is significantly restricted. Both centralized exchanges and DeFi projects have found themselves forced to cease operations entirely as it becomes increasingly difficult to obtain trading licenses for various products.

Major industry players including Crypto.com and Binance have been forced to cut operations, reduce service scope, reduce leverage, limit the types of products available and restrict certain access from some users. Despite these challenges, derivatives markets remain an important indicator of sentiment within the industry.