Chainalysis: crypto investors saw over $37 billion in gains in 2023
Data confirms that cryptocurrency investors recorded an impressive $37.6 billion in gains in 2023 despite the lackluster market performance, offsetting some of the losses incurred during the 2022 bear market.
According to a Chainalysis report shared with crypto.news, investors garnered substantial profits in ten out of the 12 months of 2023, with only August and September experiencing losses.
The downturn in August 2023, marked by Bitcoin’s (BTC) largest monthly loss of 11.28%, led to the broader crypto market’s slump, with Bitcoin plummeting to the $25,000 range and dragging down other assets. This turn of events catalyzed the losses in August.
The panic threw investors off, leading to selloffs, as most sought to hedge against any further declines. Those who demonstrated resilience succumbed to the selling pressure in September 2023, when BTC slumped below $25,000.
Data from Chainalysis indicates that investors lost $1.5 billion in August and $1.4 billion in September 2023. However, these losses were eclipsed by the gains witnessed in other months, especially in Q4 2023, when the pre-bull run phase began.
Bitcoin recorded three consecutive green monthly candles from October to December 2023, surging by 45% to close the year above the $42,000 level. This upward trend had a ripple effect across the market, allowing investors to engage in profit-taking trades.
Interestingly, about $19.5 billion, representing over 51% of the total profits in 2023, were generated in the fourth quarter of the year alone, with December witnessing the single largest monthly gains at $8.5 billion.
The total $37.6 billion gains pale in comparison to the profit of $159.7 billion witnessed in the 2021 bull run, when most assets recorded new all-time high prices. However, Chainalysis confirmed that the overall market growth in 2023 mirrored the pace recorded in 2021.
The analytics firm suggested that the disparity in gains between both years could stem from the fact that investors predominantly favored HODLing their assets in 2023, as they anticipated further price surges, given that the bull run had not yet materialized.
Investors lost $127 billion in 2022
In contrast to the profit-making years of 2021 and 2023, investors faced significant challenges in 2022 due to the bear market. The year was marred by several crises, such as the Terra and FTX implosions, which sparked widespread panic and substantial selloffs. Investors lost $127 billion in 2022.
While the gains in 2023 do not fully offset this figure, the ongoing bull run holds the potential for significant contributions. In terms of gains by country, Chainalysis found that U.S. investors reaped the highest profits, totaling $9.6 billion, with the U.K. following closely at $1.39 billion.
