• The crypto market matured “dramatically” in 2024 with billions of dollars flowing into spot crypto ETFs and transaction volume spiking on blockchain networks, especially layer-2s.
• Bitcoin’s 3-month spot price volatility stood at less than 60%, down from a 2021 peak of nearly 130%.
• Stablecoins’ total market capitalization hit an all-time high of roughly $160 billion in Q3 2024 as market participants continued to utilize them for various use cases.
The cryptocurrency market has undergone significant growth and maturation in 2024, according to a new report by Coinbase and Glassnode. This is evidenced by increasing institutional investment, expanding on-chain activity, and the proliferation of layer-2 scaling solutions.
Inflows into Spot Crypto ETFs
Spot crypto exchange-traded funds (ETFs) launched in the United States in January 2024. These ETFs attracted approximately $5 billion into digital currencies like Bitcoin during Q3 2024. The runaway success of spot crypto ETFs shows the market has become more accessible to mainstream investors.
Stablecoins Gain Market Share
The total market capitalization of stablecoins hit an all-time high of around $160 billion in Q3 2024. Stablecoins and Bitcoin now make up a larger portion of the total crypto market cap. The increasing use of stablecoins for payments, trading, and other applications reflects crypto’s expanding role in finance.
Bitcoin Becomes Less Volatile
In 2024, Bitcoin’s 3-month spot price volatility dropped below 60%, down from a 2021 peak of nearly 130%. This shows Bitcoin is maturing as an asset class, attracting longer-term investors rather than short-term speculators. The inflows into spot Bitcoin ETFs likely contributed to the drop in volatility.
Ethereum Ecosystem Growth
The Ethereum network saw major growth in 2024, even as ETH underperformed Bitcoin in price. Daily active Ethereum addresses increased sharply, while transactions grew five-fold compared to early 2023. The proliferation of layer-2 scaling solutions, like Coinbase’s Base, catalyzed Ethereum’s growth.
ETH regained market share of fees among fee-earning blockchains, rebounding to 40% in late September from a low of 9% in August. This highlights Ethereum’s strength as the leading smart contract platform despite growing competition.
Conclusion
The crypto market has matured dramatically, showing its resilience and mainstream appeal. With increased institutional investment, expanding use cases, and new scaling solutions to meet demand, the market appears primed for sustainable long-term growth.
