The cryptocurrency market has witnessed a significant shift in Q4, marking an end to a period of stagnation. Mid-October sparked this change with rumors about a Bitcoin ETF, which sent BTC to heights unseen since May 2022. Consequently, November saw a rise in trade volumes, breaking the annual average. This surge indicates a strong, potentially sustainable rally, as Kaiko’s Q4 Market Report highlighted.

Moreover, per the report, the altcoin sector thrived in this climate. By December, the improved macro environment led traders to riskier assets, pushing altcoin trade volumes to over $130 billion. Notably, Korean exchanges played a key role in this surge. Despite Binance’s reduced influence in 2023, offshore markets like Bybit and OKX drove altcoin volumes.

However, the overall market faced challenges following FTX’s collapse. Both volumes and order book depths have declined across assets and exchanges. Yet, the prospect of a spot ETF approval brings hope for liquidity recovery, with potential impacts on both trading and market-making activities.

Additionally, market depth analysis reveals less volatility compared to trade volume. This volatility suggests steady market-making activity, with no new entrants or exits. An ETF could positively influence volume and depth, potentially reshaping the market structure.

November’s end resolved Binance’s legal issues with a $4.3 billion settlement with the U.S. Justice Department. Despite causing a volume dip, this closure allowed Binance to continue operating with restrictions. Consequently, Binance’s market share decline opened opportunities for other offshore platforms like Bybit and OKX, with notable market share gains.

Significantly, SOL emerged as a remarkable success story, outperforming BTC and ETH in trade volumes on several exchanges. Coinbase and Kraken, among others, recorded days where SOL’s volume surpassed these significant cryptos. Per the latest data, SOL is valued at $98.56. Yet, liquidity hasn’t matched these price and volume increases, as evidenced on December 26, with price decoupling incidents on tokens like MINA and STX.

Besides these market movements, DeFi has also seen changes. Decentralized exchanges (DEXs) experienced an uptick in activity, albeit slightly slower than centralized exchanges (CEXs). DEX monthly trade volume rose to $29 billion in November, recovering from a multi-year low in September. However, it still lags far behind the all-time high of over $124 billion in May 2021, as highlighted in the Kaiko report.

Hence, the crypto market has experienced a notable turnaround in recent months. This surge has affected various market aspects, from ETF speculation to altcoin rallies and DeFi activities. The industry remains dynamic, with evolving trends and opportunities keeping market participants on their toes.