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  • In this series of articles we will publish reviews of our research. Their full text can be found on Binance Research.

  • Today we're presenting a preview of a recent Binance Research report analyzing key developments in the cryptocurrency space over the past month.

  • May 2023 was an eventful year: we saw large-scale macroeconomic changes, the hype around meme coins, and the sharpest drop in the overall cryptocurrency market capitalization this year.

Binance Research offers industry analysis of the processes shaping the future of Web3. We bring current knowledge from the field of crypto research to our community. If you want to dive into this topic, check out the full reports on Binance Research.

In financial markets, knowledge is power. Previously, in-depth research on digital assets was only available to large companies and experienced financiers, but now everything has changed. Binance Research gives you access to the latest data and high-quality analytics of the cryptocurrency markets.

Today we will look at the main events in the Web3 space over the past month and talk about the current state of the crypto ecosystem. We will analyze the performance of cryptocurrencies, DeFi and NFTs, and also find out what to expect in June.

Cryptocurrency market indicators in May 2023

May macroeconomic events and news were reflected in the cryptocurrency market. For much of the month, financial markets were fraught with uncertainty over the US debt ceiling. Overall, the capitalization of the crypto market decreased by 6%—this is the most noticeable drop this year.

However, Asia has seen positive regulatory developments. Beijing released a document on the development of innovation and Web3, which can be seen as a sign of China's growing openness to blockchain technologies. In addition, the Hong Kong government has announced that it plans to allow retail trading of cryptocurrencies and will begin accepting applications from digital asset exchanges from June 1st.

Change in cryptocurrency market capitalization by month (%)

Jan

Feb

Mar

Apr

Maybe

June

July

Aug

You

Oct

But I

Dec

2023

30,4

3,4

9,3

3,2

–6,0

2022

–22,6

–0,3

25,3

–18,1

–25,2

–31,7

21,8

–11,4

–2,1

7,2

–18,0

–4,5

2021

33,9

39,6

31,1

11,4

–25,7

–5,9

12,5

25,2

–9,9

42,9

–1,0

–15,0

2020

35,4

–5,5

–27,7

38,8

10,0

–4,5

25,9

13,7

–7,6

14,6

37,5

39,7

2019

–11,6

12,3

11,1

17,1

55,5

30,8

–22,5

–6,5

–13,7

14,8

–14,7

–7,9

2018

–10,2

–9,0

–42,9

67,9

–26,2

–23,4

18,1

–22,9

–1,7

–8,4

–32,1

–5,5

Source: CoinMarketCap (May 31, 2023)

Monthly price dynamics of the 10 coins with the highest market capitalization

Source: CoinMarketCap (May 31, 2023)

This month, XRP showed the best results. Ripple is expanding its functionality: the project's authors have launched a new platform that allows central banks, governments and financial institutions to issue their own digital currencies.

DOGE and SHIB were the weakest among the top 10 coins. Despite the hype around meme coins, which has not subsided all month, the general decline in the market has not spared either DOGE or SHIB. Daily Dogecoin transaction volumes have reached all-time highs following the introduction of so-called DRC-20 tokens, but how sustainable this trend will be remains unclear.

Decentralized Finance (DeFi)

The total value locked (TVL) of decentralized finance (DeFi) fell 3.4% to $47.9 billion. At the same time, the TVL shares of the leading blockchains remained generally unchanged: Ethereum - 58.1%, Tron - 11.9% and BNB Chain - 9.3%.

TVL shares of leading blockchains

Source: DeFiLlama (May 31, 2023)

Against the backdrop of a general decrease in liquidity in the network, the share of TVL Ethereum fell slightly - to 27.9 billion US dollars. Fantom experienced the sharpest decline, losing more than a third of its TVL. This decline was accompanied by rumors and uncertainty surrounding Multichain, which accounts for 35% of Fantom's TVL.

Non-fungible tokens (NFTs)

Monthly NFT trading volume

Source: Cryptoslam (May 31, 2023)

NFT trading volume increased slightly in May, ending the month just above $740 million. The total number of buyers and sellers reached a record high for the year at 1.67 million, while the total number of transactions rose to 8.92 million.

The Nansen NFT-500 Index recorded an overall decline as a result of lower minimum prices for popular NFT collections. In May, holders actively disposed of major collections, including Doodles and Mutant Ape Yacht Club (MAYC). Another potential factor was the hype around meme coins, with traders selling NFTs to tap into the burgeoning new market.

Upcoming Events

Stay up to date with news from the Web3 world with Binance Research's roundup of what's important for the coming month. Check out upcoming blockchain events below. Check out upcoming blockchain events below.

Important Events in June 2023

Source: Binance Research

Largest token unlocks in dollar terms

Source: Twitter (@top7ico), TokenUnlocks, Binance Research

Binance Research

The Binance Research team offers objective, independent, and comprehensive analysis of the cryptocurrency world. Our experts publish in-depth content on topics related to Web3, the crypto ecosystem, blockchain, the latest market developments, and much more.

This article is just a snippet of the full report, which contains additional data and detailed analysis of the most important market indicators over the past month. It also takes a closer look at meme coins, BRC-20, Ethereum second layer (L2) fees, USDT, and LSDfi.

The full version of the report can be found here. More research on current events in the Web3 world is available in the analytics and analysis section of the Binance Research website.

Learn new things and expand your capabilities through exploration of the world of cryptocurrencies!

Additional Information

  • Binance Research: Top Trends in the Cryptocurrency World - May 2023

  • Binance Research: exploring the rise in popularity of BRC-20 tokens

  • Binance Research: Cryptocurrency Management for Organizations

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