Graphical Representations by Kaiko, Highlighting the Top Ten of the Year 2024
In 2024, the crypto market experienced a significant rally, a phenomenon analysed in detail by Kaiko in ten key charts. The launch of Bitcoin-ETFs and the fourth halving of Bitcoin mining rewards were key catalysts, strengthening the market and neutralising negative effects through price increases and an increase in participants.
One of the main factors contributing to the rally was the massive inflows into spot Bitcoin ETFs. Over an unspecified billion dollars flowed into these ETFs in their first year, propelling Bitcoin prices past $100,000 and providing substantial liquidity to the market.
Weak monetary policies globally also played a role. Periods of loose or weak monetary policy in countries like Argentina, Turkey, and Lebanon triggered greater grassroots crypto adoption as local currencies weakened, driving demand for Bitcoin and stablecoins. Kaiko documented surges in crypto activity versus local currencies during these episodes, signaling crypto as a hedge against inflation and currency devaluation.
The softer U.S. dollar and expectations of Fed rate cuts also boosted the crypto market. Bitcoin’s rally traced a broader risk-on environment coupled with expectations of a Federal Reserve easing cycle, with a softer USD boosting dollar-quoted crypto flows and enhancing market momentum in early-mid 2025.
Ethereum and DeFi growth were additional factors. ETH broke its 2021 all-time highs, supported by strong spot demand and a growing ecosystem, further fueling the broader market rally.
Structural developments and institutional flows also played a significant role. XRP's increasing independence from Bitcoin’s price swings, driven by eased regulatory risk and expanded adoption of Ripple’s cross-border payment technology (ODL) in new banking corridors, demonstrates positive institutional momentum in altcoins.
Market liquidity resilience was another key factor. Despite large-scale Bitcoin sales in certain quarters, trade volumes and price levels remained robust, signalling sustained market confidence and liquidity.
The Ethereum-ETF gained popularity slowly, also due to bets on the closure of the discount in the Grayscale product. GBTC from Grayscale, as the only previous mechanism for investing in digital gold, offered non-competitive conditions for buying/redemption of shares.
Throughout 2024, the ETH/BTC price decreased, reaching a minimum since March 2021 (0.033). The transfer of funds to Solana and the hype around memecoins in the fourth quarter contributed to this decrease. Additional pressure came from the absence of staking in the launched ETFs.
The implementation of MiCA led to mass delistings of stablecoins from CEX that did not meet regulatory requirements. By November 2024, MiCA-compliant stablecoins such as EURC (Circle), EURCV (Societe Generale), and EURI (Banking Circle) held a record market share of 91%.
Bitcoin surpassed $80,000 on November 11 and set a new all-time high above $108,000 in December. An additional factor was Donald Trump's victory in the U.S. presidential election, which renewed interest in Dogecoin. Later in the year, it was revealed that the Department of Governmental Effectiveness (DOGE) would be launched, with billionaire Elon Musk and former presidential candidate Vivek Ramaswamy at the helm.
These combined factors, reflected in Kaiko’s charts, illustrate a complex interplay of macroeconomic conditions, institutional adoption, product launches (like ETFs), and market sentiment driving the 2024 crypto rally. Kaiko called Ethereum "one of the main winners" of the U.S. elections. Experts expect clarification of the asset's status from the SEC and the inclusion of staking in ETFs. The AUM of IShares Bitcoin Trust ETF (IBIT) from BlackRock exceeded $50 billion since the approval of BTC-ETF in January. From late November, an 18-day inflow wave formed, during which investors poured $2.45 billion into tools. The catalyst for the rally in this market segment was the launch of the Pump.fun platform on the Solana blockchain. The market neutralized the negative effects through price increases and an increase in participants. Kaiko called Ethereum "one of the main winners" of the U.S. elections. Experts expect clarification of the asset's status from the SEC and the inclusion of staking in ETFs. The AUM of IShares Bitcoin Trust ETF (IBIT) from BlackRock exceeded $50 billion since the approval of BTC-ETF in January. From late November, an 18-day inflow wave formed, during which investors poured $2.45 billion into tools. The transfer of funds to Solana and the hype around memecoins in the fourth quarter contributed to the decrease in ETH/BTC price. Additional pressure came from the absence of staking in the launched ETFs. It was later revealed that the Department of Governmental Effectiveness (DOGE) would be launched, with billionaire Elon Musk and former presidential candidate Vivek Ramaswamy at the helm. Kaiko marked the filling of the "Alameda gap" - a drop in market depth within 1% of the average price on U.S. platforms following the collapse of FTX and market maker Alameda Research. Just before the miner reward was halved (April 19), the average transaction fee in the bitcoin blockchain peaked at a record $146. From January, MicroStrategy acquired more than 249,850 BTC, accelerating purchases after the U.S. elections and nearly doubling its bitcoin balance in the last month. The company issued convertible bonds, raising concerns about its financial stability.
Investing in Bitcoin became increasingly popular due to the launch of Bitcoin-ETFs, which witnessed massive inflows in the first year, propelling Bitcoin prices past $100,000. The finance sector's role in this rally was further accentuated by weak monetary policies globally, particularly in countries like Argentina, Turkey, and Lebanon, where grassroots crypto adoption surged alongside local currency weakness, driving demand for Bitcoin and stablecoins.
