After a fantastic performance throughout 2020, the world’s leading cryptocurrencies continued with explosive returns in 2021, bringing the market capitalisation to a new record. According to TradingPlatforms.com, the total value of all cryptocurrencies reached 2.43 trillion in the first week of May this year.
2020 was a fantastic year for all digital currencies. The total capitalisation of cryptocurrencies in the market increased by about 300% year on year, to $758 billion in 2020, as investors flocked to cryptocurrencies due to the financial uncertainty caused by the pandemic. The $758 billion cryptocurrency capitalisation in 2020 was even higher than the capitalisation of 2017, which is considered the start year for Bitcoin and other digital currencies.
The capitalisation record, however, is being broken as so far in 2021 there has been an even more impressive increase, with many of the most important cryptocurrencies reaching the highest of all time.
Bitcoin, the largest digital currency, accounts for 45% of cryptocurrency capitalisation worldwide. CoinMarketCap data show that its price has risen more than 100% this year alone, helping its market capitalisation reach $1.1 trillion last week. Compared to $178 billion in 2020, this represents a huge increase of 515% in one year.
Nevertheless, the latest boost in cryptocurrency capitalisation has also been driven by the impressive growth of Ethereum. In 2020, the cumulative value of all Ethereum currencies was $23.4 billion. In the last twelve months, this number has increased by 1.656%, a growth rate three times that of Bitcoin. In 2021 alone, Ethereum’s capitalisation increased by almost 400%, from $82.8 billion in January to $411.1 billion last week.
In addition to increasing its market capitalisation, Ethereum has also seen a significant increase in day-to-day transactions worldwide. Over the past three months, daily trading has hovered around 1.1 million and then reached an all-time high of 1.53 million last week, up 135% year-on-year. Statistics also show that Ethereum’s daily trading volume more than doubled last year, from $16.7 billion to $38.7 billion.
In addition to the price rally in Bitcoin and Ethereum, which fuelled the global growth of the cryptocurrency market, other top digital currencies have also risen in recent years.
In May 2020, the combined value of all currencies with the Binance Coin index reached $2.6 billion. Since then, this number has increased by 3.642% on an annual basis, to almost $97.3 billion, pushing the cryptocurrency in third place in terms of capitalisation worldwide.
However, the fourth most valuable cryptocurrency in the world, Dogecoin, has experienced even more impressive, five-digit growth in the last year. The meme-inspired digital currency reached $322.6 million in market capitalisation in 2020. Since then, Dogecoin’s market capitalisation has increased by 30.400%, to $91.6 billion last week.