The year 2023 has proven to be an exceptional period for digital assets, highlighted by a remarkable 172% increase in Bitcoin’s market capitalization, as reported by the on-chain analysis firm Glassnode.
Notably, other digital assets have also experienced robust growth throughout the year. Ethereum and the broader altcoin ecosystem, for instance, have witnessed a substantial 90% increase in their market caps, according to the same report.
The market has surpassed various critical technical and on-chain pricing models, and the rally since late October has been the driving force behind most of these gains.
Moreover, digital assets have shown a significant outperformance compared to traditional assets such as Equities, Bonds, and Precious Metals throughout the entire year.
In the context of Bitcoin, the most substantial correction in 2023 closed just 20% below the local high. This suggests that favorable buy-side support and a balanced supply and demand dynamic have characterized the market throughout the year.
Until October, Bitcoin transaction volumes exhibited a relatively static trend, indicating a phase shift in the market. Notably, exchange inflow and outflow volumes for both BTC and ETH have been on the rise throughout the year, indicating an expansion in interest in spot trading.
The year witnessed new all-time highs in Bitcoin transaction counts, primarily attributed to the increasing prevalence of Ordinals and Inscriptions.
Additionally, long-term holders currently possess nearly an all-time high percentage of the bitcoin supply. Furthermore, a significant majority of coins are presently held in a profitable position, whether through changing hands or as a result of prices surpassing the cost basis. This points to a landscape where a substantial portion of investors is experiencing gains.
