Investing.com -- The cryptocurrency market reached a record high of $3.91 trillion in December 2024, driven by optimism about regulations, institutional adoption, and Bitcoin's new all-time high of $108,000.
Factors that contributed to Bitcoin's rise included MicroStrategy’s inclusion in the Nasdaq 100 and continued Bitcoin acquisitions, according to Binance Research.
However, the market saw a sharp correction towards the end of December when the Federal Reserve scaled back its planned 2025 rate cuts from four to two, despite a modest 0.25% cut during the month.
This decision resulted in a market correction that erased over $0.5 trillion from the cryptocurrency market capitalization.
Despite the late December correction, Bitcoin ended the year with a 123.4% increase in its market cap, ranking it as the 7th largest global asset by market cap, ahead of Saudi Aramco (TADAWUL:2222) and Silver. Bitcoin's performance was one of the best among the top 10 global assets, second only to Nvidia (NASDAQ:NVDA).
Factors that contributed to this performance include spot ETF approvals, Bitcoin Halving, shifts in monetary policy, and expectations of a more supportive regulatory environment. If the growth continues into 2025, Bitcoin's position as a leading asset class could be further solidified.
Meanwhile, Ethena's USDe has seen a rapid increase in its market cap to around $5.9 billion, surpassing DAI to become the 3rd largest stablecoin by market capitalization. Factors behind this success include the high yield behind staked USDe and the addition of sUSDe as a collateral asset on Aave in November.
In December, decentralized spot and perpetuals volumes reached all-time highs of $326 billion and $356 billion, respectively. Decentralized perpetuals trading surged over 370% year-to-date, largely driven by Hyperliquid. Lending and liquid staking protocols also reached new TVL highs of $55 billion and $71 billion, respectively. The DeFi sector could see further growth with the incoming pro-crypto Trump administration.
AI Agents are becoming more prevalent in the crypto world, with top AI agent tokens now commanding multi-billion dollar valuations and around 100,000 daily impressions. The top platforms include Virtuals and ai16z, the team behind the Eliza framework to launch your own agent.
The most notable individual agent is aixbt, which provides daily market analysis on a range of crypto topics. While many agents focus on similar use cases, there is a growing number of entertainment agents, with trading-agents also being developed.
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