review for the third quarter of 2021

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The cryptocurrency market is rapidly recovering from the downturn that occurred in the second quarter of 2021. Overview of the main event of the third quarter – in Bloomchain’s quarterly research.

You can read or download the Bloomchain study “Cryptocurrency Markets in the Third Quarter 2021” by following the link

Market capitalization

After a failed second quarter, the cryptocurrency market has returned to the green zone. During the period July to September 2021, its capitalization grew by almost 50% and amounted to $1.9 trillion. At the same time, growth since the beginning of the calendar year was 145%.

Bitcoin’s capitalization during the reporting period increased from $649.5 billion to $813.5 billion, but the share of the world’s largest cryptocurrency in the market continues to decline. During the reporting period, there was a decrease from 46% to 42%.

The second place is held by Ethereum, its share has grown from 16.2% to 18.6%, the third is the Cardano token, which has surpassed Tether. The top 5 cryptocurrencies in terms of capitalization leave the cryptocurrency “meme” Dogecoin, where it was taken by XRP.

Source: Bloomchain Research

The most successful month of the quarter was August, as a result of which the ten largest cryptocurrencies in the world showed growth. Their aggregate capitalization increased by three quarters during the month. In September, six out of ten coins lost their value at once. Tether, Solana, USD Coin and Polkadot were in the green in terms of capitalization at the end of the first month of fall.

stablecoin

Four stablecoins continue to be in the top 30 cryptocurrencies by capitalization – Tether, USD Coin, Binance USD, Dai. The former surpasses the rest in terms of transaction volume and average number of active addresses.

At the end of the third quarter of 2021, the share of USDT supply in Ethereum in the total capitalization of the four stablecoins was 41%, which is 6 pp higher than Coinbase’s share of stablecoins.

The supply of major stablecoins at the end of the quarter, share of their total capitalization. Source: Bloomchain Research

Read also: lies, big lies and mooring

Profitability

When choosing a buy and hold strategy, the five largest cryptocurrencies can bring profits to investors. At the end of the quarter, the purchase of Cardano can provide maximum profitability – every $100 invested in this token will generate another $50.

In general, at the end of the third quarter of 2021, the average ROI for the top 5 cryptocurrencies is around 30%. This is 53 things at once. less than in the same period before. Back then, ROI was driven by the growth of Dogecoin.

Source: Bloomchain Research

Bitcoin: spreads and correlation with other assets

By the end of the first half of the year, the difference between the maximum and minimum bitcoin prices ($64,863 and $28,723), respectively, exceeded $35K and became the historical maximum. For comparison: at the end of 2020, it was more than $25 thousand.

Source: Bloomchain Research

The correlation between bitcoin overnight returns and traditional assets (including gold, oil and US stocks) is significantly lower than the correlation between asset prices for the quarter. This shows a weak linear relationship between fluctuations in major cryptocurrencies and classic benchmarks.

You can read more about the relationship between these indicators in our research.

Source: Bloomchain Research

Miner’s income

The average daily earnings of miners on the bitcoin network in the third quarter of 2021 more than doubled, exceeding $45 million. At the same time, their share of commission income remained at the level of the first two quarters, accounting for 11% of the total remuneration.

Despite the tightening regulations of the cryptocurrency industry in China, more than 60% of the hashrate on the bitcoin network still belongs to mining companies with Chinese roots. The largest share belongs to AntPool – 17%, in second and third place are F2Pool and Poolin.

Source: Bloomchain Research

Read also: Mining: China will stop mining bitcoin, that’s good

The average commission per transaction on the bitcoin network in the third quarter of 2021 fell sharply – instantly by 80%, from $ 17.5 to $ 3. On the Ethereum network, on the contrary, it grew by 20%, amounting to almost $ 18.

Source: Bloomchain Research

Read also: Ethereum Generous Commissions – Bug or Scam?

Crypto wallet

At the end of the quarter, the average monthly number of active wallets where the supply of bitcoin money is stored increased from 854 to 894K, 72%.

Source: Bloomchain Research

Between July and September, the number of largest BTC wallets owned by cryptocurrency exchanges fell from 18 to 16. Seven of them are owned by Okex, two by Binance and Bitfinex, one by Bittrex, Huobi, CoinCheck, BITMEX and Poloniex.

The biggest wallet is still owned by Binance. At the time of publication of the material, its balance was $15.5 billion.

DeFi Market

At the end of September 2021, the volume of funds blocked in decentralized financial markets (DeFi) in services based on Ethereum amounted to $78.75 billion, which is almost double the previous quarter. In Binance Smart Chain (BSC) based services, it also grew, but only 9%, to $21.944 billion.

One of the largest categories of decentralized finance is loans. In DeFi services based on Ethereum, they account for 53% of the total market volume, in services based on BSC – 23%.

Read also: Credit Bubbles and Multiple Profits – What’s Happening in the DeFi Market

Source: Bloomchain Research

NFT

The market for NFTs (non-fungible tokens) continues to grow: from July to September, their trading volume exceeded $ 6 billion, which is 15 times more than in the previous quarter.

Source: Bloomchain Research

Read also: how the NFT market works

Collections and art, as well as games, remain the largest segment of NFT. The largest share of projects in the market – the OpenSea market – in the third quarter of 2021 is 97%.

You can read or download the Bloomchain study “Cryptocurrency Markets in the Third Quarter 2021” by following the link

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