Cryptocurrencies witnessed a significant recovery in 2023 following the challenging 'crypto winter' of 2022, which was marked by widespread sell-offs, layoffs, contagion concerns, and frauds globally. 2023 also saw India implementing a 30% tax on crypto profits and a 1% tax deduction at source (TDS) on all transactions
In 2023, Bitcoin - the most popular and expensive crypto rebounded from a low of almost $16,000 hitting a high of $44,500, although it failed to reach its all-time high of $68,990.
Ethereum, the second most traded crypto, also made a strong comeback to $2,400 from a low of $1,151.
The biggest surge was seen in Solana that jumped to nearly $80 from a low of $8. Solana also is way off its all-time high of $259.
Cardano, Polygon, Dogecoin, Avalanche were among other popular cryptos that made a strong comeback in 2023.
The UK Financial Conduct Authority estimated that there were nearly 20,000 different cryptocurrencies by the start of 2023, although many of them were no longer traded and would never grow to a significant size.
By November 2023, it was estimated that around 8,800 cryptocurrencies were in existence. The top few gainers saw 80% to 500% return during the year.
Even as 2023 had its fair share of negative developments such as the fall of FTX and Binance, the global markets held and grew their presence.
As per an analysis in September 2023, India despite its regulatory and tax environment, has emerged as one of the top crypto markets by volume.
Total India trade volumes in the last year until October 2023 was around $34 billion. Of this, India's offshore trading volume is $32 billion. So nearly 93% of total India volume is from offshore exchanges, which do not have registered offices in India or comply with local regulations from July 2022 to October 2023.
An estimated 5.2 million Indian users have moved to offshore platforms since the introduction of TDS.
Now, as 2024 approaches, investors are wondering if these cryptos can build on the gains from the previous year.
So the things to watch out for are if the spot Bitcoin ETF gets approval in this coming year. Also, the Bitcoin halving is expected to happen in April 2024. Ethereum updates are also keenly awaited and so are the rate cuts from global central banks.
But the volatility and uncertainty persists with Wall Street banks and brokerages projecting Bitcoin prices in 2024 at anywhere between $30,000 and $1,25,000.
(Edited by : Shweta Mungre)
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