Bankless Mid-Year Review 2024: The Bull Market is Still On, Don't Get Easily Left Behind

Original Title: Crypto in 2024: Mid-Year Reflections

Author: Arjun Chand, Bankless

The rapid development of cryptocurrency technology is overwhelming.

The first half of 2024 is no exception, with new chains and applications emerging daily, and the crypto industry gradually gaining mainstream recognition in the financial sector.

In the frenzy of pump tweets and bull market price action, it's easy to lose sight of the bigger picture. So, let's narrow our focus and pay attention to the real signals amid the "noise."

TL;DR: Crypto is just getting started, don't get left behind.

In this article, we will review the key developments in the industry during the first half of 2024, exploring significant events and trends.

1. Cryptocurrency Has Become Mainstream

Remember when cryptocurrency was just a toy for cypherpunks? Those days are long gone.

In the first half of 2024, cryptocurrency made a strong entry into the mainstream.

The turning point was the long-awaited approval of the spot Bitcoin ETF in January. Suddenly, Wall Street had a convenient gateway into the cryptocurrency market, and they rushed in. Eleven ETFs were launched in a single day, setting record trading volumes.

Wall Street didn't stop at Bitcoin. The U.S. Securities and Exchange Commission (SEC) eventually approved key documents for eight Ethereum spot ETFs in May, further validating the entire crypto ecosystem and opening the door for broader institutional adoption.

It's not just about ETFs. Fortune 500 companies are also getting involved. A record number of companies are launching crypto projects, from consumer payments to tokenized treasury bills, and a dazzling array of other initiatives.

What’s the bottom line? Cryptocurrency is no longer a marginalized product. From Wall Street to Silicon Valley, it is favored by financial heavyweights. The future of finance is cryptocurrency, and everyone knows it.

Source: The State of Crypto: The Fortune 500 Moving Onchain

2. Accelerating Cryptocurrency Adoption

The pace of cryptocurrency adoption is remarkable. The number of active users on the blockchain has surged, with active addresses reaching an all-time high of 42.92 million in April.

Source: State of Crypto Index

This is not just a fleeting trend; it indicates that users can do meaningful things on-chain.

One factor may be the surge of different types of applications and services in the crypto ecosystem, from social finance applications like Farcaster, Friend.tech, and Fantasytop, to new chains and innovative DeFi primitives like restaking.

Another factor is the resurgence of DeFi. DeFi activity and interest have risen again, indicating that people's interest and activity on-chain have reignited, moving beyond mere speculation to perhaps real-world utility, such as stablecoins for payments and asset tokenization for government securities and other RWAs.

The momentum is clear: more and more people are joining the chain, and they are finding more reasons to stay.

3. Ethereum Remains Dominant, but Solana is Rising

Ethereum remains the dominant force in the cryptocurrency space. Over 60% of the total value locked in DeFi is on Ethereum, making the Ethereum ecosystem the foundation for countless applications and chains.

This dominance is not just about where the hot money flows; it also concerns technological advancements on the roadmap. Ethereum is scaling through L2s like Base, which have seen widespread adoption this year, and thanks to the recent Dencun upgrade, users are enjoying significantly lower gas fees.

However, cryptocurrency is now more than just Ethereum and its ecosystem. We now have ecosystems like Solana that are vying for market share.

Forget the hype for a moment; let's focus on the numbers.

Solana's daily active users are 2-3 times higher than the same period last year, nearing the peak of the 2021 frenzy. This user growth is not superficial; it is translating into actual usage—Solana's DEX trading volume has even surpassed Ethereum multiple times during this cycle, as it has become the go-to place for memecoin trading.

Moreover, Solana's innovation engine is thriving. Technological advancements like zk-compression and user-friendly features like Blinks are laying the groundwork for broader adoption, and we can see Solana's network effects taking root.

There is no doubt: Ethereum is not going away. Its mature network effects and large developer community ensure its continued significance in the cryptocurrency space.

But Solana's remarkable progress cannot be overlooked. Both ecosystems are thriving in their unique ways. This parallel adoption is a win for cryptocurrency users, as it accelerates innovation and propels the entire industry forward.

4. Moving Forward and Upward

Bitcoin reached an all-time high in March, briefly breaking the $70,000 mark. While this frenzy seemed to end quite suddenly, let's not be too disheartened; this bull market is far from over.

To be honest, the market is a bit crazy, isn't it? Stocks are hitting all-time highs, meme coins are soaring, and every celebrity is launching their own token. A reality check may have been overdue, and thus we experienced a significant drop in June. But the key point is: market sentiment may have dipped significantly, but the long-term outlook for cryptocurrency remains optimistic.

Market sentiment may be shifting, but don't overlook the bullish signals.

The long-awaited ETH ETF is on the horizon, the Federal Reserve is likely to lower interest rates, and with potential positive policy shifts, cryptocurrency is likely to continue to hold a place on the political stage during the U.S. elections.

This pullback may feel like an end, but in cryptocurrency, it often represents a buying opportunity. So, unless you are facing a margin call, hang in there and enjoy the ride.

Conclusion

So, was the development of cryptocurrency in the first half of 2024 smooth sailing? Not quite.

We have seen quite a bit of noise—regulatory FUD, narrative bubbles, meme coin frenzies, celebrity coins, volatile price movements, and disappointing airdrops.

But hey, that's cryptocurrency. Narrowing our focus, things look much brighter. Cryptocurrency adoption is accelerating, institutional interest is at an all-time high, and the regulatory environment is improving. All these signs indicate that the industry will continue to grow, as the fundamentals are strong and future catalysts are already starting to take effect.

The bull market must continue.