Bitcoin, stablecoins and DeFi: 2020’s top-performing crypto assets

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Bitcoin (BTC) has had a stellar 2020, but how are other top crypto assets doing? Let’s take a look at how some of the leading cryptocurrencies by market cap did this.

Bitcoin

First, Bitcoin has seen massive gains since January 1, when its price rose from $ 7,195 to $ 28,422.

In 12 months, Bitcoin’s price rose 290%, outperforming all major stock indices and most stocks except for a few, including Tesla (TSLA).

The main catalysts behind Bitcoin’s rally were the surge in institutional demand, favorable financial conditions as a result of central banks’ liquidity injections, and the decline in the US dollar.

BTC / USD monthly chart (Coinbase). Source: TradingView.com

The combination of the three macro factors got Bitcoin going in October. When major institutional platforms like CME and Grayscale saw sharp spikes in volume and inflows, the rally of Bitcoin accelerated.

ether

The price for Ether (ETH) developed strongly in 2020 despite the recent stagnating phase compared to Bitcoin.

Ether price started at $ 128 on major exchanges in 2020, and at its peak on December 30th, ETH hit $ 748.

The main driver of the November Ether rally was the release of Eth2. After reaching a deposit threshold of over 400,000 ETH, Eth2 began.

Eth2 is a major network upgrade for Ethereum as it scales the blockchain exponentially over time. Without Eth2, Ethereum can process less than 20 transactions per second. With Eth2, that number increases to potentially thousands of transactions per second.

Old school altcoins

In year-to-date performance, most old-school altcoins (those from 2017 and earlier), including XRP, Cadano (ADA), and Stellar (XLM), lagged behind Bitcoin pr.

Of the original altcoins, XRP did particularly well in November when Bitcoin rose to its all-time high.

XRP started the year at $ 0.1923 and rose to $ 0.9210, showing a four-fold increase in about 11 months. However, when BTC surged above $ 20,000, altcoins were hit, causing the XRP to drop to $ 0.52. Following the SEC lawsuit against Ripple, XRP continued to fall, dropping to just $ 0.17.

Smart contract logs

Polkadot, Chainlink, EOS and Tezos have also rallied since the start of the year. The four smart contract-related cryptocurrencies each saw significant catalysts for short-term rallies as BTC surged to $ 20,000.

Bitcoin weekly chart against Chainlink, Polkadot, EOS and Tezos. Source: TradingView.com

For example, Chainlink benefited from the explosive growth of the decentralized finance area (DeFi). Chainlink is an oracle-focused blockchain network and the goal of an oracle is to relay data to DeFi protocols.

When the total value locked in DeFi reached $ 16 billion, Chainlink and many other tokens linked to DeFi rebounded.

Despite various catalysts, Polkadot, EOS, Tezos and Chainlink have lagged behind Bitcoin in year-to-date gains. The main reason for the subdued price movement was Bitcoin’s meteoric rally to $ 20,000, which caused altcoins to retreat.

Specialized tokens like Wrapped Bitcoin, USDC, and Tether also saw significant market capitalization growth. These tokens are primarily used in DeFi protocols, and the rapid increase in user activity made every token endemic to the DeFi ecosystem.

Tether just passed a market cap of $ 20 billion!

This fantastic milestone is further confirmation that Tether maintains its # 1 spot as the most liquid, stable and trusted currency! pic.twitter.com/sorWjzChIo

– Tether (@Tether_to) December 18, 2020

Especially at Tether, the market capitalization rose rapidly in the fourth quarter of 2020. As Cointelegraph reported, Tether, the most widely used stable coin in the cryptocurrency market, was valued at over $ 20 billion.