Key takeaways:
- On the heels of Bitcoin and Ethereum all-time highs, the total cryptocurrency market capitalization surpassed $3 trillion for the first time ever on November 10.
- The number of BTC addresses with a non-zero balance, and the number of long-term BTC holders is at a record high, while ETH is slowly turning into a deflationary asset.
- Headlines in November were dominated by metaverse projects, which recorded incredible gains following Facebook’s Meta rebrand.
- 2 out of 5 biggest gainers in November from the Top 100 cryptos by market cap were blockchain gaming tokens.
- The market consolidation throughout the second half of the month brought the total cryptocurrency market cap nearly back down to November 1 values.
Total crypto market capitalization surpassed $3 trillion as BTC and ETH hit peak values
During generally bullish market conditions at the beginning of November, several major cryptocurrencies, including two with the largest market capitalization, Bitcoin (BTC) and Ethereum (ETH), climbed to their respective ATH prices. The surge in market capitalization of BTC and ETH contributed the lion’s share towards the combined value of all cryptocurrency assets in circulation exceeding $3 trillion for the first time ever. This remarkable milestone was surpassed on November 10, when BTC peaked at $68,770 and ETH at $4,867.
At the same time, Bitcoin blockchain recorded a record number of BTC addresses with a non-zero balance and a multi-year high number of active BTC addresses. Blockchain analytics company Glassnode also reported an increase in BTC long-term holders (LTHs) share, while the number of short-term holders (STHs) dropped to a multi-year low in November. Although around 85% of Bitcoin supply is in profit at current market rates, investors are hesitant to realize their profits.
On the other hand, ETH’s rally was also accelerated by the deflationary pressure brought to the network by the EIP-1599, which implemented a real-time gas fee burning mechanism in August 2021. The amount of ETH burned by this mechanism exceeded 1 million ETH tokens (worth $460 billion at current prices) on November 24.
While the rate of ETH burning is currently insufficient for it to be considered an inherently deflationary asset, this is projected to change in April 2022, when ETH burning will surpass ETH generation. This means that ETH’s circulating supply might be in decline from mid-2022 onwards. Partly due to these projections, ETH closed November with a price tag of $4,750, which marks the highest monthly close in its history.
Metaverse projects saw outstanding gains in November
After Facebook announced that the social networking conglomerate would rebrand to Meta to emphasize its commitment towards developing its metaverse, interesting trends were observed in the crypto markets.
Nearly every blockchain project dealing with metaverse or blockchain gaming soared. Still, GALA (GALA) and The Sandbox (SAND), with their +547% and +299% monthly gains, respectively, stood out as the most successful projects in the blockchain gaming sector and the broader cryptocurrency market. Decentraland’s MANA also recorded a rather impressive +69% gain in November. Thereby, this metaverse project overtook Axie Infinity (AXS) and became the biggest gaming token by market cap.
While the hype around metaverse projects can partly be attributed to Facebook’s rebrand, there is an additional bullish factor in play. Many blockchain gaming projects are also developing games that operate by the so-called Play to Earn (P2E) model, which allows players to earn money while playing their favorite game. This new monetization model could disrupt the broader gaming industry, which many investors are placing their bets on.
The second half of November was marked by market consolidation
While we spoke about explosive growth on cryptocurrency markets at the start of November, things started to go south in the second half of the month, which was marked by market consolidation that ultimately negated the early-November success. The total cryptocurrency market capitalization stood at $2.68 trillion on November 1, then climbed to an ATH value of $3.03 trillion on November 10, only to drop back down to $2.69 trillion on November 30 in a series of significant drops.
Nevertheless, some of the top 10 crypto assets managed to weather through the market rough patch and end the month with green numbers. These were Binance Coin (BNB), whose price increased by 22% throughout November, Solana (SOL) with a 12% monthly gain, and Ethereum with a 10% gain. Other assets, on the other hand, were hit hard. Cardano (ADA) suffered an 18% loss during November and became the worst-performing top-10 asset. ADA was closely followed by Polkadot (DOT) with a 13% loss. Ripple (XRP) suffered a 7% loss, and even Bitcoin ended the month at a price 6% lower than the one at the beginning of November.
