Amid a Global Economic Slowdown and Geopolitical Risks, Cryptocurrencies Are Making a Comeback

Amid a global economic slowdown and geopolitical risks, cryptocurrencies are making a comeback, ranking among the world's top-performing assets in the first seven months of 2024 along with Nvidia, one of the "Magnificent 7" tech stocks on the US stock exchange.

Among cryptocurrencies, Binance Coin (BNB), which can be used to trade and pay fees on the Binance exchange, offered the highest return for 2024 of 89.6% as of July 22, followed by Bitcoin at 51.0% and Ethereum 47.5%.

Other top performers include the Nasdaq 100 index at 19.8%, gold 16.4%, MSCI World 14%, oil 13.4%, MSCI Asia 8.21%, MSCI Emerging Markets 6.80% and coal 5.68%.

This year cryptocurrencies received regulatory support, starting with the US Securities and Exchange Commission's (SEC) endorsement of the first spot Bitcoin exchange-traded fund (ETF) in January.

On May 24, the SEC approved the establishment of a spot Ethereum ETF (ETH ETF) and registered the trading of investment units on US stock exchanges, allowing institutional investors, a group with high purchasing power, to invest in this asset.

As a result, the market capitalisation of cryptocurrencies has increased to roughly US$2.5 trillion as of July 3, from around $1 trillion in mid-October last year.

Kavita Gupta, founder and partner at Delta Blockchain Fund, said the launch of spot ETH ETF could have major implications for other altcoins.

"The launch of the ETH ETF was a major development for the space and will kick-start the next altcoin rally, despite the Bitcoin dominance we have seen thus far," she said.

Cryptocurrency enthusiasts expect four more coins have the potential to be endorsed for spot ETFs, which could attract institutional investors to invest more in the crypto market in second half of the year.

BNB'S UTILITY

BNB, issued by the Binance exchange, was created in