Messari’s report on Bitcoin, Ethereum and crypto

Messari’s Q2 2023 report on the state of Bitcoin, Ethereum and the crypto market was published yesterday.

The PDF is a whopping 68 pages long, and was compiled by Senior Research Analyst Mihai Grigore, along with Stephen Basile, Editorial Coordinator, and Peter Horton, Research Analyst. 

The report aggregates market data and key performance indicators from over 30 crypto projects followed by Messari, and also includes Bitcoin and Ethereum as a comparison. 

Bitcoin and Ethereum in Messari’s crypto report

With regard to Bitcoin in particular, an analysis was made of Stacks, a layer-2 based on Bitcoin that enables the creation of smart contracts. 

Stacks’ market capitalization has increased by 53.3% since the beginning of the year, mainly due to the success of Ordinals and other Bitcoin assets.

Its TVL hit an annual high at $36.0 million, although the Nakamoto version is still under development.

sBTC is also still under development, hoping to provide access to a huge amount of liquidity in BTC through a bridge.

During the quarter, due to a bug, Stacking was disabled for two cycles. 

Ethereum (ETH)

As far as Ethereum is concerned, the report highlights the growth of ETH’s dominance from 17.4% at the beginning of the year to 18% at the end of June.

In addition, it points out that there was also an increase in usage and burns during the quarter, resulting in higher deflation.

Layer-2 solutions also continued to grow, but growth was limited by rising gas costs.

Market performance

Compared to twelve months ago, among the cryptocurrencies analysed in this report, Ethereum stands out, with an unparalleled +80%. 

In second place, in terms of price performance compared to June 2022, is Stacks (+69%) followed by Bitcoin (+53%). 

It is worth noting that the majority of the others show losses between June 2022 and June 2023, with Pocket Network recording a whooping -72%. 

Losses of over 60% were also reported for Boba Network and The Sandbox, and over 50% for Near, Apecoin, and 1inch, 

Among the main altcoins, the negative performances of Cardano (-37%), and Solana (-44%) stand out, followed by -26% for Polkadot. Avalanche, Filecoin and Hedera also did poorly. 

BNB saved itself with +9%, while Tron did better with +17%. 

XRP (+42%) and Polygon (+37%) did well. 

A completely different story applies to the performance of the second quarter alone, i.e. the comparison between prices on 30 June 2023 and those on 31 March of the same year. 

The strongest of the crypto assets analyzed was Tron, with +16%, followed by Bitcoin (+7%) and Ethereum (+6%). 

Practically all the others suffered, with losses of over 40% for Polygon, Apecoin, 1inch and Boba Network. 

Solana stopped at -11%, with XRP at -12%. BNB, on the other hand, lost 24% of its market value in the quarter. 

In other words, it was not a good quarter for the crypto markets. However, it should not be forgotten that July was a much more positive month, thanks in particular to XRP’s victory over the SEC. 

Trading volumes on Bitcoin, Ethereum and crypto according to Messari’s report

By contrast, trading volumes were all down compared to both June 2022 and March 2023. 

The only exceptions were Stacks (+312% compared to June 2022) and Venus (+390% compared to March 2023). 

This should come as no surprise, both because during 2022 the hype of 2021 completely wore off, causing 2023 to begin with almost no hype, and because even during the first six months of 2023 the hype actually continued to wane. 

Curiously, Bitcoin’s trading volumes fell more compared to March 2023 (-53%) than to June 2022 (-48%), while for Ethereum it was the opposite: only -24% compared to March, but -57% compared to last year. 

Among the major altcoins, all of them have recorded a larger drop in volume since June 2022 than since March 2023, so Bitcoin in this respect is a real exception. 

On the other hand, the first quarter of 2023 saw a real dominance of Bitcoin on the crypto markets, whereas in June 2022 all cryptocurrencies suffered from the collapse of Celsius. 

However, this only reiterates that Bitcoin is different from all other cryptocurrencies, and that in the long run it tends to lose less when prices fall.