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Full-Year Review 2022 & Themes for 2023

Binance Research (JieXuan Chua, CFA, Shivam Sharma, Stefan Piech)


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  • Overall, 2022 served as a wake-up call and juxtaposed the highs of 2021. Nonetheless, volatility is part and parcel of market cycles. This is not something new for the crypto industry, and we remain cautiously optimistic looking into 2023.

  • L1s had an eventful year. Ethereum transitioned to Proof-of-Stake, BNB Chain and Polygon gained market share in the vacuum left by Terra’s collapse, and new L1s such as Aptos and Sui made their first forays into the market.

  • L2s had a breakout year with strong inflows across 2022. TVL rose 119% (denominated in ETH) across 2022. While USD-denominated TVL was down around 28%, this is significantly lower than the ~76% USD-denominated drawdown in the whole DeFi market and is arguably largely a factor of dropping crypto prices.

  • The DeFi sector experienced a sharp drop in TVL following exogenous market events and a challenging macro environment. TVL stands at around US$40B, or close to 25% of what it was at the start of 2022. More and more users have engaged in the “flight to quality”.

  • NFTs recorded US$21.9B in sales in 2022, an increase of 10.6% YoY. This is primarily contributed by strong sales in the first half of 2022. However, the NFT market witnessed a relatively quiet second half as overall sentiment turned negative and traders exited the market following a series of market events.

  • The number of blockchain gaming projects has continued to rise but there are signs of slowing growth. Hype behind X-to-Earn games also fizzled out as user growth slowed down and the spotlight was cast on the quality of gameplay, as well as the tokenomics of X-to-Earn games. Interest in the metaverse has also waned.

  • Numerous market events across 2022 have fuelled the policy debate. While regulation brings much-wanted clarity, it is essential to make informed decisions.

  • 2022 marked a year of record-breaking VC investment and fundraising activities. It had been a front-loaded year with funds raising high amounts of capital that they’re now looking to deploy. Over H2 2022, deal flow had generally decreased.

  • Finally, we wrapped up the report with a summary of key themes in 2023 amongst the different sectors in crypto. Read on to find out what we have to say.

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About Binance Research: Binance Research is the research arm of Binance, the world's leading cryptocurrency exchange. The team is committed to delivering objective, independent, and comprehensive analysis and aims to be the thought leader in the crypto space. Our analysts publish insightful thought pieces regularly on topics related but not limited to, the crypto ecosystem, blockchain technologies, and the latest market themes.

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