The first and second quarters of the year threw the crypto market against continuous downtrends, with cryptocurrency prices plunging and assets reading double negatives.
In the meantime, the US stock market slipped into a bear market, falling faster than most people anticipated. Although the S&P 500 stock market rose in January, the peak period was brief as it gradually declined.
CNBC stock market and business published a report in March detailing the percentage decline of stocks, stating it to be the worst period since the first quarter of 2020. By Q2, the MSCI ACWI index, which tracks stock prices from both emerging and developed markets, saw a fall of 21% from the November peak period.
Despite all odds, the crypto market slightly recovered during the third quarter (Q3). According to the Q3 report by CoinGecko, the total crypto market inched higher, rallying from a low of $875B to about $100B higher than at the end of Q2.
Bitcoin’s Performance in Q3
Bitcoin came out strong, even with the doubt-inducing turmoil of the third quarter. It outperformed other assets except for the US dollar index, which measures USD strength against the six most influential global currencies.
While the currency’s price dip was close to how much US equities fell, it ended with only a -1% change in price compared to the loss sustained by the equities market.
The DeFi Rebirth
The DeFi space saw a rebound of ~31%, with most projects within the sectors finding ways to halt losses. DEXs had a significant increase in market share, rising by 36.8% to $10.9B.
Stablecoin Remained Stagnant
The report by CoinGecko revealed that the top five stablecoins, Tether, USD Coin, Binance USD, DAI, and Frax, retained their position from Q2 in the exact format. While there were noticeable changes in their prices, more was needed to displace their jobs.
USD Outperformed Stocks and Other Crypto Assets
The US Dollar Index took the cake for asset classes, but Bitcoin’s dramatic rise couldn’t shake its stance. It also outperformed significant competitors, the EUR and GBP.
NFT Market Winter
The NFT industry wasn’t so fortunate, though, as it caught the chills of the winter breeze, losing around 77% in total trading volume. Reuters reported an NFT sales plunge in Q3, with a downtrend of 60% from Q2.
The market’s peak in the first quarter recorded $12.5 billion; however, it dropped sharply in Q2 to $8.4 billion and then $3.4 billion in Q3.
Out of the many marketplaces that boomed during NFT mooning, only MagicEden saw growth in September.
The Fall of The Crypto Market (Q1)
Due to macroeconomic factors, high-interest rates, and higher inflation, major exchanges witnessed a drastic decline in value.
Bitcoin took one of the biggest hits for cryptocurrencies, with over $119 billion wiped off its value in the first quarter of the year. The coin recorded a more than 48% decline, according to data from CoinDesk.
Coinbase was marking a 44% drop from the last quarter of 2021. According to its Q1 analysis, the crypto exchange’s net revenue was 1.2 billion, down by 56% compared to Q4 2021.
Ripple, another cryptocurrency, ranked high on worst-performing assets, declining about 77%. Notable mentions like VET Chain, NEO, and others, also took severe hits enough to cripple their platforms.
The Fall of The Crypto Market (Q2)
During Q2, Bitcoin’s price dropped 56.27% as the asset struggled to stay above $20,000. Some analysts called it “the worst in its history,” and the Terra Luna collapse contributed to the continued decline.
Along with Coinbase’s $1.1 billion loss and others like Immunefi hitting a $670 million deficit, the second quarter of the year didn’t smile on the crypto market either.
Prediction for Q4
Q3 is over, and Bitcoin investors are skeptical about the last quarter of the year. Altcoin holders are no different, as the price of Bitcoin inherently affects others.
Dailyfx– the portal for financial news, indicators, and analysis- forecasts put the currency in a good light. However, it highlights the risk of a market rebound due to deflation in the crypto space.
DecenTrader takes a bullish stance, arming Bitcoin with the potential to hit $85,000 as its next target.
Since Q4 is still ongoing, there might be hope for Bitcoin, other altcoins, and crypto exchanges to enter a bull market.