Key Trends And Highlights of 2020
The total market cap for all cryptocurrencies increased by more than 3.3x in 2020 alone, expanding the crypto market dramatically.
The number of institutional clients on Binance grew by 46% since the end of 2019. Institutions are entering the crypto space at an historic rate.
Total trading volumes across Binance reached $3 trillion USDT, our highest yet.
DeFi innovations like liquidity mining, yield farming, and crypto lending provided new ways of earning passive income, with Binance Savings attracting the most users out of all financial management products on Binance.
In 2020, worldwide markets faced unprecedented volatility, while the economic recovery in many countries has been K-shaped, delivering a financial blow to already-vulnerable communities. With traditional financial systems under stress, retail users and institutions turned to cryptocurrencies en masse, driving the crypto markets to new heights.
Expanding Crypto Market Cap Signals Influx In Capital And Interest
This year alone, the total market cap of all cryptocurrencies grew rapidly, from approximately $193B on January 1, 2020 to $641B at the time of writing. Much of this year’s market cap expansion can be attributed to Bitcoin, as traders rushed to buy Bitcoin as a hedge against inflation. Bitcoin repeatedly broke new all-time highs in late November and December, while users turned away from gold in large numbers, prompting many to consider whether Bitcoin is a better store of value and inflation hedge.
Bitcoin Is Still On Top, But Altcoins Take A Step Forward
As of December 21, 2020:
Bitcoin (BTC) makes up 66% of the total market cap of all cryptocurrencies
Ether (ETH) follows at 11%, while XRP falls to 4%
Though Bitcoin (BTC) remains king, Ether (ETH) also posted impressive growth in 2020, thanks in part to the rise in DeFi and the proliferation of popular decentralized apps (DApps) built to run on the Ethereum network
Mainstream Institutions Are Getting Into Crypto—With Mass Adoption To Follow?
The influx of capital into crypto markets comes during a time of economic tumult, and marks an important shift in the public’s perception of cryptocurrencies: rather than being seen as a speculative asset for those looking for eye-popping returns, cryptocurrencies now maintain a much broader appeal.
As activity in the crypto markets concentrated around cryptocurrency exchanges, Binance experienced record-high traffic volumes throughout the year.
Total Trading Volume*: Over 3.0 trillion USDT
All-Time High Trading Volume* (24-Hour): Over 52.6 billion USDT
* across Spot, Futures, Options, Margin, and Leveraged Tokens
Asia continues to be a dominant crypto market, consistently posting the highest trading volumes, with Europe following closely behind. With high awareness and adoption rates among the general public, it’s clear why Asia maintains a large share of global crypto trading volumes.
Amidst A Booming Crypto Market, Crypto-Derivatives Gain Steam
Already the largest spot exchange for three years running, Binance has also become the mainstay for crypto derivatives. As with traditional finance, crypto futures and options help provide the necessary hedging as the market grows. Binance Futures, which launched last September, has quickly become a leading crypto derivatives exchange with deep liquidity for fast transactions with minimal slippage.
Top futures trading pairs (by volume) in 2020 include:
For users looking for an easy way to access leverage, Binance also offers leveraged tokens: tokenized versions of leveraged futures positions that give users exposure to leveraged gains while minimizing the risk of liquidation.
Most traded leveraged tokens by volume on Binance:
When it comes to both spot and futures markets, Bitcoin (BTC/USDT) was the trading pair on everybody’s watchlist (Bitcoin was also the most viewed page on Binance this year), with BTC/USDT trades accounting for more than 25% of total spot trading volume on Binance in 2020.
The most popular cryptocurrency trading pairs on Binance spot markets (by volume) include:
Similarly, the top 3 most popular cryptocurrencies to hold on Binance (based on USDT equivalent in spot wallets) were:
BNB’s popularity on Binance can be attributed to the fact that users save 25% on trading fees when they hold BNB. Furthermore, users can earn high yields on their BNB assets via BNB vault.
For traders looking to place large orders, Binance’s over-the-counter (OTC) trading services provide access to deeper liquidity with quick price quotes and fast settlement. The most traded tokens on OTC include:
Traders looking to bypass transaction fees entirely turned to Binance’s peer-to-peer (P2P) trading feature to buy and sell crypto. P2P remains a popular option for those looking to send and receive low cost, cross-border remittances, particularly in these regions that topped the list based on P2P trading activity:
Finally, those looking to buy crypto via our fiat gateways, users in select regions can simply link a credit/debit card or bank account to pay with cash. The top regions for buying and selling crypto using fiat currencies were:
The UK and Europe
Russia and CIS
Crypto Lending Products Provide New Income Opportunities for Crypto Owners
The financial management products that make crypto ownership more rewarding, ranked by user count, include:
Liquid Swap — which debuted only a few months earlier, in September
Cryptocurrency lending is one of the crypto industry’s fastest growing segments, and has proven to be a hit with crypto owners looking for an additional source of income. Anyone with eligible crypto assets can “subscribe” their assets in exchange for a fixed interest rate.
Crypto loans often carry attractive, double digit interest rates, far higher than those seen on traditional loans. The market for crypto loans has increased steadily throughout the year, and poses an intriguing alternative to traditional banking.
The top 5 most popular tokens for crypto loans by total trades were:
Crypto Mining During The Year Of The Bitcoin Halving
In May, the third Bitcoin halving occurred, cutting the rewards for Bitcoin miners in half and reducing the rate of new Bitcoin entering circulation. Binance Pool, established this April, steadily acquired market share, and now ranks #3 amongst global mining pools.
Binance Smart Chain (BSC) Bridges the Gap Between CeFi and DeFi
Binance Smart Chain debuted in September of this year, and marked Binance’s biggest step yet into the world of DeFi. Binance Smart Chain introduced BNB Staking, as well as cross-chain and EVM compatibility to users within the Binance ecosystem.
Today, there are over 60 projects running on Binance Smart Chain, with PancakeSwap being the most popular automated market maker (AMM) and yield farm. To encourage development on the new blockchain platform, we also announced a $100M Accelerator Fund to support emerging DeFi projects.
Blockchain And Crypto Topics You Couldn’t Get Enough Of
Cryptocurrency adoption has undoubtedly risen over the past year, but crypto literacy and education remains a formidable barrier to mass adoption. Binance Academy reached an all-time high readership of 4.7 million in 2020, and provides free learning resources on blockchain and crypto, with explainers and guides that are suitable for crypto newbies and enthusiasts alike.
During the pandemic, the idea of generating passive income was on many people’s minds. It’s no surprise then, that this year’s most read articles were on the topic of DeFi and yield farming:
Binance Research, the home to institutional grade analysis and insights on topics spanning blockchain, economics, and finance, is a go-to destination for those looking for unbiased and in-depth information. Their project report on Bitcoin was viewed more times than any other research piece this year.
Finally, the most watched YouTube video was CZ’s fireside chat with Michael Saylor, the CEO of MicroStrategy, who famously pivoted to Bitcoin after global markets plunged in March of this year.
A Breakthrough Year for Crypto
This has been one of the most important years on record for the blockchain and crypto landscape. Strong interest in crypto from everyday users and institutions alike have resulted in an influx of attention and capital, despite the global pandemic.
With crypto adoption picking up speed, Bitcoin’s price repeatedly broke all-time highs, becoming one of the best performing assets of the year. At the same time, crypto and DeFi infrastructure continues to mature at a rapid pace, while the booming market for stablecoins and DeFi borrowing and lending protocols have sparked new avenues for growth. After a tough year for many, the future of crypto is one of the rare bright spots that give us hope in the coming year.