Author: CoinGecko

Translated by: Blockchain in Plain Language

Bitcoin's fourth halving in 2024 marks the beginning of the fourth bull market in the cryptocurrency space, although not in the way many expected. The market momentum, coinciding with the 15th anniversary of Bitcoin's inception, has been significantly driven by changes in macroeconomic policy, including the approval of the U.S. spot ETF, central bank interest rate cuts, and Donald Trump's re-election. These changes have brought cryptocurrencies back into the mainstream spotlight following the FTX collapse, with ETFs providing new channels for capital inflow. Bitcoin reached an all-time high of $108,135 on December 17, propelling the total market capitalization of the cryptocurrency market to a new record of $3.91 trillion.

Our 2024 Annual Report on the Cryptocurrency Industry covers everything from the landscape of the crypto market to analyses of Bitcoin and Ethereum, delving into the decentralized finance (DeFi) and non-fungible token (NFT) ecosystems, and reviewing the performance of centralized exchanges (CEX) and decentralized exchanges (DEX).

We have summarized seven key highlights, and you can read the full 53-page report if needed:

1) In Q4 2024, the total market capitalization of the cryptocurrency market grew by 45.7%, closing at $3.91 trillion, a year-on-year increase of 97.7%.

2) Bitcoin increased its market dominance, currently accounting for 53.6% of the total cryptocurrency market capitalization.

3) Bitcoin outperformed major asset classes in both the entirety of 2024 and in Q4.

4) The market capitalization of AI agents grew by 322.2% in Q4 2024, rising from $4.8 billion to $15.4 billion.

5) In Q4 2024, the trading volume of the top ten Ethereum Layer 2 solutions increased by 48.3%, with Base accounting for 48.3% of the trading volume.

6) In Q4 2024, the spot trading volume of centralized exchanges reached $6.45 trillion, a quarter-on-quarter increase of 111.7%, setting a new historical record.

7) In Q4 2024, Solana surpassed Ethereum to become the dominant chain for DEX trading, accounting for over 30% of all DEX transactions.

1. In Q4 2024, the total market capitalization of the cryptocurrency market grew by 45.7%, closing at $3.91 trillion

In Q4 2024, the total market capitalization of the cryptocurrency market rose by 45.7% (or $1.07 trillion), ultimately closing at $3.40 trillion. Although the market lost some momentum in Q3, it rebounded in mid-Q4 after a brief period of bottom consolidation, particularly following Donald Trump's victory in the U.S. presidential election.

In 2024, the total market capitalization of the cryptocurrency market nearly doubled, growing by 97.7%. Its market cap reached an all-time high of $3.91 trillion in mid-December before retreating to $3.40 trillion. Meanwhile, the average trading volume in Q4 was $200.7 billion, an increase of 128.2% from $88 billion in Q3.

2. Bitcoin's market share is rising, currently accounting for 53.6% of the total cryptocurrency market capitalization

Bitcoin (BTC)'s market share continues to climb, albeit at a slower pace, growing by 0.9% in Q4 2024. In this quarter, XRP performed the best, with its market share rising to 3.5% (an increase of 2.0%). This allowed XRP to leap from 7th to 4th place, surpassing BNB and Solana (SOL).

Additionally, Dogecoin (DOGE) emerged as a new addition to the top 7 by market capitalization, replacing USDC. This marks the first time since April 2021 that USDC has failed to make the top 7. Meanwhile, Ethereum (ETH) continued to decline in Q4, with its market share dropping from 13.4% in Q3 to 11.8%, reaching its lowest level since April 2021.

3. Bitcoin outperformed major asset classes in 2024 overall and in Q4

Q4 2024 was a milestone quarter for Bitcoin (BTC) as it broke the $100,000 mark for the first time, reaching a peak price of $108,135 on December 9 before slightly retreating to close the year at $93,508. This signifies a +121.5% increase for Bitcoin year-to-date.

The rise of Bitcoin began from a low of $54,000 in Q3, but after Donald Trump's victory in the U.S. presidential election, the price saw another significant surge. This upward momentum was also supported by interest rate cuts from the U.S. Federal Reserve, with the market generally expecting monetary easing policies to continue into 2025.

Meanwhile, the average daily trading volume surged from $31.1 billion in Q3 to $62.6 billion in Q4, a quarter-on-quarter increase of +101.3%. On December 6, when Bitcoin surpassed $100,000, the spot trading volume exceeded $190 billion, setting a new annual high.

The stock market also performed strongly in Q4, with the Nasdaq index rising by +8.0% and the S&P 500 index increasing by +3.0%. At the same time, the U.S. Dollar Index (DXY) also performed well, rising by +7.0%, primarily driven by the depreciation of other major currencies. The Japanese Yen (JPY) had the worst performance in Q4, falling by -8.0%, nearly erasing the gains from the end of the Yen carry trade.

4. The market capitalization of AI agents grew by +322.2% in Q4 2024, rising from $4.8 billion to $15.5 billion

AI agents as a category rapidly emerged after the launch of GOAT on Solana in early October. Although the "Terminal of Truths" pioneered AI agent KOLs in the X prototype, this narrative trend has largely faded. However, the category saw astonishing market capitalization growth in Q4 2024, increasing by +322.2%, from $4.8 billion to $15.5 billion.

Currently, Solana and Base are the only blockchains with significant AI agents. By the end of 2024, the Base blockchain significantly captured market share from Solana and GOAT through projects like AIXBT and Virtuals Protocol (VIRTUAL). However, Solana has begun to reclaim some market share after launching GRIFFAIN and AI Rig Complex (ARC) at the end of December.

5. In Q4 2024, the trading volume of the top 10 Ethereum Layer 2 solutions grew by +48.3%, with Base accounting for 48.3% of the trading volume

Ethereum Layer 2 continued to grow in Q4 2024, with the top 10 Layer 2 solutions achieving an average daily trading volume of 15 million transactions. The growth in trading volume was primarily driven by Base, which had an average daily trading volume of 7.2 million transactions in Q4, up +78.7% from 4 million transactions in Q3. In contrast, the Ethereum mainnet processed an average daily trading volume of about 1.2 million transactions in Q4. Of the transactions in the top 10 Layer 2 solutions in Q4, 48.3% occurred on Base.

Meanwhile, Taiko became the second most active Layer 2, surpassing Arbitrum, with Taiko accounting for 20.6% of the trading volume in Q4, ahead of Arbitrum's 13.7%. Taiko's trading volume grew by +85.5%, while Arbitrum only grew by +14.0%. Taiko's significant growth can be attributed to the launch of several DeFi protocols on this relatively new chain.

6. In Q4 2024, the spot trading volume of centralized exchanges reached $6.45 trillion, a quarter-on-quarter increase of +111.7%, setting a new high

In Q4 2024, the top 10 centralized exchanges (CEX) achieved a spot trading volume of $6.5 trillion, a quarter-on-quarter increase of +111.7%.

This marks the first time quarterly trading volume has surpassed the $6 trillion mark. The total trading volume of the top 10 CEXs in 2024 was $17.4 trillion, compared to $7.2 trillion in 2023.

BN continued to maintain its dominance, ending December with a market share of 34.7% among the top 10 CEXs. Notably, BN's trading volume surpassed $1 trillion in December, marking the second time in 2024 that this milestone was reached.

Upbit was the fastest-growing CEX in Q4, with its trading volume increasing from $135.5 billion to $561.9 billion, a quarter-on-quarter growth of +314.8%. Following South Korea's announcement of a state of emergency on December 3, Upbit's trading volume surged. During this tumultuous period, the average daily trading volume reached approximately $21 billion, six times its average daily trading volume.

7. Solana surpassed Ethereum to become the dominant chain for DEX trading in Q4 2024, accounting for over 30% of all transactions

In Q4 2024, Solana became the dominant chain for decentralized exchange (DEX) trading, with its market share exceeding 30%. In Q4, Solana's trading volume reached $219.2 billion, a quarter-on-quarter increase of +152.0%. In comparison, Ethereum's trading volume was $184.3 billion, with its market share fluctuating between 25% and 28%. Nevertheless, Ethereum still led Solana on an annual basis, accounting for 33.5% of DEX trading volume, while Solana's market share was 25.2%.

Meanwhile, Base successfully surpassed Arbitrum in Q4, maintaining a leading position. Its market share exceeded 14% in Q4, while Arbitrum's market share remained between 10% and 11%. The Layer 2 solution supported by Coinbase reached a market share of 19.0% in December, a quarter-on-quarter increase of +206.5%. Base's trading volume was $116.7 billion, while Arbitrum's was $79.2 billion.

Tron was the fastest-growing chain among the top ten, with a quarter-on-quarter increase of +232.7%. Its trading volume rose from $2.9 billion in Q3 to $9.6 billion in Q4. By December 2024, Tron's market share was 2.1%, making it the sixth-largest chain.

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