By; OLIVIA NNOROM
In the second quarter (Q2) of 2023, the Fear and Greed Index for cryptocurrencies increased from an initial level of around 30 in Q1 to 52 per cent, indicating an improved market sentiment.
This information was extracted from a report by CoinMarketCap, a digital asset price-tracking platform, which analysed market behaviour during this period.
The report highlighted several significant events, including the rise of Bitcoin ETFs triggered by BlackRock’s filing for a spot Bitcoin-Traded Fund. Various financial giants such as Ark Invest, Fidelity Digital, Valkyrie, VanEck, and 21 Shares also sought approval for similar Bitcoin ETFs from the US Securities and Exchange Commission.
The report also highlighted a surge in liquid staking derivatives (LSDs) due to the Ethereum Shapells upgrade in April, where LSD platforms secured over one-third of Ethereum’s total value staked.
Other notable events included the emergence of projects focused on on-chain trading of real-world assets, the introduction of Decentralised Physical Infrastructure solutions, increased usage of Zero-knowledge Sync solutions, and the inception of platforms enabling the restaking of staked ether.
However, the crypto market in second quarter lacked strong market narratives compared to the first quarter, which saw the doubling of Bitcoin’s price, the rise of layer-2 protocols, and a more active non-fungible token (NFT) market.
Although there was a growing trend in Memecoins and BRC-20 tokens, they did not generate the same level of excitement as in the previous quarter.
According to the report, the total market cap at the end of Q2 reached $1.17 trillion, representing a 48% year-on-year increase, but most of this growth occurred in Q1.
The report also noted a significant decline in the total spot trading volume of the top 20 crypto exchanges, which dropped by 19.5% from Q1 to 2023 Q2.
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