| Kraken Intelligence

Silver Lining

Hot on the heels of August, September 2022 also trended negatively for cryptoassets overall. Based on market capitalization, all sectors saw negative returns for the month, ranging from -14% to -1%.

Following the overall crypto market trend, NFT market activity also slowed in August. Average daily users and average daily transactions fell -5.7% and -3.1% MoM, respectively. NFT volume also decreased as average daily volume dropped -26.3%. DeFi assets saw mixed returns, ranging from -21% to +27%.

Are the markets poised for recovery in the coming weeks? Find out in our latest market recap and outlook report as the team explores what happened in September and what lies ahead.

The Merge

The Merge snagged the spotlight in September as Ethereum successfully transitioned from proof-of-work (PoW) to proof-of-stake (PoS). On Sept. 15, validators completely replaced ETH miners and annualized volatility spiked to 94% two days later.

Whale activity for ETH was higher than for BTC in September. The amount of ETH held by whales (those holding more than Ξ10,000) started the month at Ξ81.2M, before closing the month at Ξ81.5M. The amount of ETH held by whales dipped to Ξ80.9M on Sept. 14, the day before The Merge. The number of ETH whales started at 1,314 and closed at 1,293, decreasing over the course of the month.

TradFi continued to enter the field

While September has historically been a slower month, this year larger TradFi players were active. BlackRock made headlines by leveraging Kraken-owned CF Benchmarks, the leading crypto index provider. BlackRock, the world’s largest asset management firm, will use CF’s bitcoin index pricing product for its first crypto offering.

Meanwhile, blockchain oracle network Chainlink also collaborated with CF Benchmarks to launch the CF Bitcoin Interest Rate Curve (CF BIRC), which tracks bitcoin borrowing and lending. Chainlink also teamed with interbank messaging system SWIFT on a cross-chain interoperability protocol in an initial proof-of-concept.

BTC correlations for both risk-on and risk-off assets started to rise during the month. BTC remained positively correlated with the Nasdaq and the S&P 500 equity indices, as well as U.S. Treasurys and gold.

Ushering in a new era

The biggest event in the crypto space in September was the success of The Merge, ushering in a new era for Ethereum, one of the largest blockchain networks in the industry.

While the overall space saw negative performance trends in September, it still performed marginally better than August 2022. Despite the bear market and broader macroeconomic uncertainty, the industry has garnered significant interest among traditional institutions – a cause for long-term optimism in the crypto space.

Want to learn more about what went down and what’s ahead? Read the Kraken Intelligence report, Silver Lining, to understand what’s moving the crypto market.


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These materials are for general information purposes only and are not investment advice or a recommendation or solicitation to buy, sell or hold any cryptoasset or to engage in any specific trading strategy. Some crypto products and markets are unregulated, and you may not be protected by government compensation and/or regulatory protection schemes. The unpredictable nature of the cryptoasset markets can lead to loss of funds. Tax may be payable on any return and/or on any increase in the value of your cryptoassets and you should seek independent advice on your taxation position.