Bitcoin rallied throughout the first weeks of 2023 to reclaim over 25 percent of its pre-2022 crypto winter value. Altcoins, such as Polygon (MATIC) and Solana (SOL), also showed signs of recovery, with SOL rising to 44 percent last month and Polygon going over 19 percent last week.
Last year was a challenging time for the cryptocurrency industry. According to CoinGecko’s 2022 Annual Crypto Industry Report, the market cap was over 64 percent lower than the previous year, with the market beginning to trade below the $1 trillion range in the second quarter of 2022.
#CoinGecko 2022 Annual Crypto Industry Report 📊
2022 was a tumultuous year for #crypto – NFTs and DeFi are among the hardest hit sectors, while stablecoins had a mixed performance.
Here are 8 key highlights you shouldn’t miss 👇 pic.twitter.com/w4n4BoSq7x
— CoinGecko (@coingecko) January 17, 2023
Reports have suggested the market may still feel the brunt of the crash throughout 2023. However, Bitcoin traded at $21,236 on Tuesday, a price not seen since last November when major crypto company FTX collapsed. The rise followed a Consumer Price Index (CPI) report that showed easing inflation pressures in December and slowed rate hikes.
Road to recovery
CoinGecko’s report showed the market’s trading volume diminishing in each quarter of 2022. The first half of the year began at around $100 billion before sinking to $90 billion in the third quarter, then $60 billion in the fourth.
CoinGecko described the diminishing volume as an indicator of investors’ withdrawal from the market, possibly exiting it via centralized exchange or CEX pathways.
“2023 may be too soon for a complete recovery, with the aftermath of 2022’s events still playing out,” CoinGecko COO and co-founder Bobby Ong said.
Although Bitcoin has risen significantly in the past month, it is still missing 68 percent of its November 2021 value. However, investors and industry executives are confident that Bitcoin will continue to rise and remain stable in the coming months.
“I think we’ll see less volatility in the Bitcoin price over the next months just because traders are likely scarred by the recent events of the FTX crash,” Komodo chief technology officer Kadan Standelmann said, as quoted by Insider.
As of January 18, 2023, Bitcoin is priced at $21,225.