Will the crypto market continue the rise of 2023 in 2024? On-chain data tells you the answer.

Let's take a look at the report card

The cryptocurrency market exploded in 2023. The CMI index (excluding stablecoins) rose by 123% over the year, with the total market capitalization soaring from nearly $1.2 trillion to $2.4 trillion—a 99.2% increase. BTC surged by 79.85%, ETH increased by 40.45%, far outpacing the S&P 500 (16.88%) and the Nasdaq 100 (54.56%).

The question is: Can this market trend last until 2024?

5 Truths Behind the Price Increase in 2023

1. Bitcoin Halving Expectations (April 2024)

The BTC algorithm automatically halves the miner rewards every 210,000 blocks (approximately every 4 years). The historical pattern is very clear:

• 950% increase 6 months after the first halving, 8342% increase 12 months later
• After the second halving, the price rose by 38% in 6 months and by 286% in 12 months.
• After the third halving (May 2020), it rose by 83% in 6 months and by 562% in 12 months.

Scarcity Drives Price - This is the logic that BTC holders have long bet on.

2. Spot ETF is imminent

Institutions like BlackRock and Grayscale are all waiting for the SEC to approve a spot Bitcoin ETF. This is no small matter:

• The existing ETFs are futures-based, and institutions do not need to buy actual coins.
• Once the new spot ETF is approved, institutions must purchase a large amount of BTC as the underlying asset.
• This is like giving the market a shot of adrenaline.

BlackRock manages assets worth $9.42 trillion, and the scale of funds it can mobilize is terrifying.

3. The Water Splashing from the AI Craze

ChatGPT ignites an AI investment frenzy, and Nvidia's stock price soars. The crypto sphere has jumped on the bandwagon—AI concept coins and tokens for AI + on-chain applications have also surged. These projects' Tokens are not only transaction mediums but also represent the right to use services.

4. Market sentiment has completely reversed

On-chain data is clear at a glance:

• The total market capitalization steadily increased from 1.2 trillion to 2.4 trillion.
• Huge trading volume: Average daily transaction volume of 1.4 trillion USD over 6 months, far exceeding the historical average of 790 billion USD.
• Such an increase cannot occur without a significant influx of real money.

Yes, the market has shifted from “The crypto world is about to die” to “FOMO is about to take off.”

5. Futures Position Surge

BTC futures open interest soared to 17,321 contracts starting in August, while ETH futures reached 6,114 contracts. This indicates that new capital continues to flow in, either from new players entering the market or from old players increasing their positions.

Futures activity and spot prices usually move in the same direction — this is a signal that institutions are positioning themselves in advance.

Three Scenarios for 2024

Script A: Soft Landing (Most Optimistic)

Inflation continues to decline → The Federal Reserve pauses interest rate hikes or even cuts rates → Liquidity is released → Both tech stocks and crypto assets rise. However, BTC may be overshadowed by relatively high-growth tech stocks.

Judgment: Positive for cryptocurrency, but not the strongest

Script B: Inflation Rebound (Most Exciting)

Rising prices → Central bank raises interest rates again → Both stocks and bonds are hit → Investors turn to anti-inflation assets. At this time, BTC's fixed supply becomes a selling point, similar to gold properties. This may trigger a large influx of institutional investors.

Judgment: BTC is the strongest stimulant

Script C: Stagflation (Worst Case)

Economic recession but inflation persists → Central banks are in a dilemma → Whether to raise interest rates or inject liquidity is a trap → High interest rates suppress growth stocks and crypto assets. Unless inflation continues, investors will have no choice but to flee to BTC for safety.

Judgment: Most cryptocurrencies are bearish, BTC may resist the decline

Should I invest?

Speaking the Truth: The return rate in 2023 has crushed the stock market, but past performance ≠ future expectations.

The rational approach is:

1. Allocate a portion for long-term holding of BTC and ETH (driven by halving + ETF)
2. Take small trial and error AI concept coins and small market cap projects (with the potential for 10X, 50X, or even 100X)
3. If you understand trading, use leveraged CFDs for short-term fluctuations, but do so at your own risk.
4. Do not go all in, diversify risks.

Bottom line: Don't play without a methodology. Use the DACS classification method (filter by computation/currency/DeFi/cultural entertainment/smart contracts/digitalization/stablecoins) to benchmark projects across four dimensions: fundamentals, token supply, technological accumulation, and market sentiment.

The key variables for 2024 are still macro and policy. However, from on-chain data, the intention of institutions to go long is already very clear.