The latest data shows that although CRYPTOCURRENCIES witnessed a massive market crash experienced in the second quarter of 2022, digital assets made a relative recovery in the third quarter amid current market conditions, according to the Q3 report released by data platform CoinGecko.

According to CoinGecko, the report highlighted that such recovery is manifested based on the fact that the cryptocurrency market increased its market capitalization from a low of $903 billion in July to reach $1.2 trillion in August.

While Bitcoin struggled in Q3, it managed to outperform other commodities like gold, oil, and other traditional assets, except for the US Dollar Index (DXY), which tracks the value of the dollar against major currencies. However, from a year-to-date (YTD) perspective, Bitcoin still saw the largest loss of -58% compared to all other asset classes. In other words, the cryptocurrency has plunged more than 58% year-to-date and is now hovering around $19,113.66 per coin, according to data from CoinGecko. Bitcoin continues to trade mostly at the same pace as US stocks, but has largely rallied compared to the stock market in the third quarter.

DeFi rebound

Data from CoinGecko also revealed that the decentralized finance (DeFi) market rallied 31% in Q3, from $54.66 billion on July 1 to $63.02 billion on August 23, 2022. It is not news that the DeFi space has has faced it with difficulty, as data showed that the DeFi ecosystem lost 68.13%, representing $155.79 billion in Total Value Locked (TVL) in Q2 2022.

The rally can be attributed to the slow but steady recovery of the crypto market, which is led by Ether, the native token of the Ethereum blockchain. Even though Ether (ETH) has plunged 33% to $1,330 since its quarterly high in mid-August, it is still up 26% compared to Q2. The Ethereum blockchain accounts for $35.44 billion, or 56.24% of the TVL seen in the crypto space today.

In addition to DEXs (decentralized exchanges) maintaining their status as the largest component of DeFi, they saw a significant increase in market share, rising 36.8% to $10.9 billion, according to the data. This has been driven by the increase in trading volume, primarily driven by the Merge narrative, and with the continued popularity of the liquid betting sector. In Q3, the liquid betting landscape nearly tripled its market cap to $1.54 billion, with Lido, the market cap leader in that category, up 264% to $1.60 in that period.

NFT Winter

According to data from CoinGecko, non-fungible token (NFT) sales fell significantly in Q3 as crypto investors struggle with the ongoing “crypto winter” and demands for highly speculative digital assets show little sign of returning. The NFT market witnessed a heavy blow in the last quarter as it saw a -77% drop in total trading volume across the top 5 NFT markets, OpenSea, Magic Eden, LooksRare, X2Y2 and CryptoPunks.

MagicEden was the only NFT market to see growth in September, doubling its volume and MoM dominance, while the rest of its competitors continued to fall. With its recent expansion into the Ethereum blockchain and the launch of its headline-grabbing y00ts NFT collections, MagicEden gained significant dominance (from 9% to 22%) in Q3. The Solana-based NFT market appears to be eating up OpenSea’s market share, which now stands at 60% from 90% in Q3. But it remains to be seen if MagicEden can keep up the momentum.

Stablecoin Movements

Finally, in the last quarter, the market valuation of the stablecoin economy fell 3%, from $156.7 billion to $152 billion. The top 5 stablecoins are Tether (USDT), USD Coin (USDC), Binance USD (BUSD), Dai (DAI) and Frax (FRAX) as they have continued to hold their positions, with no new entrants or changes to their order.

However, the data showed interesting moves in market capitalization within the top 5, with USDC falling 16% or $9 billion after sanctions were imposed by the US Office of Foreign Assets Control (OFAC). to Tornado Cash. BUSD market capitalization grew the most, rising 18% or $3 billion due to USDC inflows, triggered by Binance’s announcement of automatic BUSD conversion. USDT also witnessed a slight rise, possibly having absorbed some of the USDC selloffs.

As of September, USDT topped $68 billion, USDC fell to $49.39 billion, while Binance USD (BUSD) increased its market cap to $21.63 billion.

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