Bitcoin and liquid staking protocols lead crypto resurgence in Q1 2023
The cryptocurrency ecosystem has enjoyed a buoyant start to the year as Bitcoin (BTC) and decentralized finance (DeFi) protocols surge in market capitalization through the first quarter of 2023.
These are the key takeaways from the first quarterly Crypto Industry Report published by CoinGecko on April 18. BTC emerged as the best-performing asset of Q1 2023, with gains of 72.4%, outperforming the likes of the NASDAQ index and Gold which marked 15.7% and 8.4% gains, respectively.
The report highlights that all major asset classes saw gains through the first quarter of the year, barring crude oil, which dropped by 6.1%. This decline was attributed to United States inflation data which cited a reduction in oil demand and ill effects of the U.S. banking crisis.
The wider cryptocurrency markets have enjoyed a quarter of resurgence, with the overall market capitalization reaching $1.2 trillion at the end of Q1. CoinGecko highlights a 48.9%, $406 billion gain from the cryptocurrency market cap of $829 billion at the end of 2022.
The DeFi space was another standout performer, rising by $29.6 billion in value through the first quarter. The report cites the impressive performance of liquid staking governance tokens, which saw a 210% increase in market cap since the start of 2023.
Ethereum’s Shapella upgrade played a major role in driving the increase of capital flows into liquid staking pools, with the network’s upgrade finally unlocking ETH staking reward withdrawals. The report notes that liquid staking is now the third largest category in the DeFi sector.
Related: Ether hits 11-month high as post-Shapella withdrawals pass 1M ETH
While Bitcoin and DeFi have been major movers thus far this year, the top 15 stablecoins saw their
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