As an investor, you want to ride the crypto wave with style and finesse. Our report isn't just about information; it's your treasure map to navigate the crypto seas. So, grab your shades because we're about to make your crypto investments cool, calculated, and oh-so-profitable.

Whether you're a beginner or a seasoned investor, CharlieDeFi Research can help you navigate the ever-changing world of crypto.

July-Aug 2023 Crypto Market

Navigating the Calm and the Storm

In July 2023, crypto enthusiasts were left intrigued and inquisitive. While some might describe it as a time of subdued anticipation, we view it as a noteworthy episode in the ongoing crypto narrative that was far from uneventful.

Following a robust performance in the initial months of 2023, bitcoin (BTC) and other prominent cryptocurrencies embarked on the latter half of the year with underwhelming results, despite a favorable legal verdict in July related to the ongoing legal dispute involving XRP creator Ripple and the U.S. Securities and Exchange Commission (SEC).

In July, the CEO of OpenAI, the company behind ChatGPT, introduced Worldcoin (WLD), a contentious new cryptocurrency that utilizes iris scans to verify users' identities. Simultaneously, the House Financial Services Committee progressed with new cryptocurrency legislation, which has the potential to provide clarity on the regulatory landscape for digital assets in the United States.

Now, let's dive into the numbers. In July, the cryptocurrency market set a leisurely pace, akin to an experienced marathon runner taking a moment to catch their breath. The total market capitalization saw a modest increase of 1.0%, making it the most conservative monthly shift we've observed this year.

While the first half of the year saw global crypto ownership reach the significant milestone of 516 million users, the second half of the year was characterized by excitement. Notable events included the XRP vs. SEC ruling, which favored Ripple's assertion that XRP should not be classified as a security, and the remarkable surge of Moons (MOON), the native token of Reddit's r/CryptoCurrency community, during July 2023.

As of July 16 2023

XRP stood out as the top performer, experiencing a substantial 47.4% price increase following a favorable outcome in the SEC v. Ripple lawsuit. This positive development had its own “ripple effect” on the wider altcoin market, leading to price boosts for other tokens like SOL and MATIC.

Moreover, the rebranding of Twitter to "X" had an impact on the meme cryptocurrency DOGE, which saw a notable price surge, possibly because of its perceived connection with Elon Musk, the owner of "X."

As of July 16, 2023

The following series of events commenced with the launch of WLD, a project spearheaded by Sam Altman, co-founder of OpenAI, the parent company for ChatGPT. Worldcoin's primary objective is to introduce a groundbreaking method for distinguishing between humans and Artificial Intelligence (AI) in the digital domain. However, the project faced significant criticism, mainly due to its use of biometric data, specifically eye scans, as a means of identity verification.

As of July 31, 2023

Another significant DeFi breach sent shockwaves through the industry, resulting in the theft of 389 million USD. This incident marked the largest loss in 2023 and pushed total DeFi losses to an astonishing 77 billion USD overall.

According to data from De.Fi's Rekt Database, these losses can be attributed to hacks and exploits. Ethereum emerged as the most targeted platform, experiencing losses of 350 million USD spread across 36 separate incidents. On the other hand, Multichain suffered the most substantial single-case loss, totalling 231 million USD, which was attributed to an access control exploit, as indicated by De.Fi's analysis.

As of Aug 4, 2023

As of Aug 4, 2023

Access control mishaps proved to be the culprits behind three major cases, causing a jaw-dropping loss of 287 million USD overall. Rugpulls, while reigning as the most frequent type of attack with 38 documented cases, have yielded comparatively lesser damages - a total of 36 million USD. Meanwhile, re-entrancy attacks, although less common with only six instances, have still inflicted substantial losses of 58 million USD.

As for the various targets of these crypto attacks, tokens bore the brunt of the onslaught, enduring 39 attacks and enduring losses totalling 35.9 million USD. Borrowing and lending protocols, on the other hand, were besieged only once, resulting in a loss of 3.4 million USD. The bridge category, unfortunately, took the hardest hit, reporting a staggering loss of 241 million USD from two separate incidents.

At the top of the exploit leaderboard, the Multichain vulnerability has seized the throne, boasting a colossal loss of 231.1 million USD, which can be primarily attributed to access control lapses.

As per data from the Rekt Database, the July efforts to reclaim funds from recent exploits yielded a disappointingly meager result. A mere 7 million USD was successfully retrieved, maintaining the regrettable pattern of persistently low recovery rates in recent times.

In fact, July stands out as the pinnacle of DeFi losses for 2023, with the total losses for the year now nearing a staggering 1 billion USD. The gap between July and the next highest month, which was March, is significant, with July reporting losses exceeding that month by a substantial 73 million USD.

Bitcoin enthusiasts encounter a setback as the monthly Stochastic indicator takes a downward turn

By the close of August, BTC displayed a signal of being overbought as indicated by its monthly stochastic, a sign that has previously coincided with market peaks.

Katie Stockton, the founder and managing partner of Fairlead Strategies, conveyed in a client note that at the end of August, BTC indeed confirmed an overbought downturn in its monthly stochastic, marking a setback for the cryptocurrency. This downturn hints at a potentially protracted process of establishing a foundation, particularly considering the challenge posed by the monthly cloud model, which adds resistance (around 31.9K USD) compared with the weekly cloud model.

This relates to bitcoin's recurrent struggle to breach the "cloud resistance" barrier at 31,900 USD over recent months and indicates the likelihood of a prolonged bottoming or stabilization process. This can be seen as a step back on the path to a more extensive long-term turnaround, as outlined by Stockton.

As of the latest update, BTC is currently being traded at a rate of 25,700 USD. Katie Stockton has indicated that there is a near-term support level at 25,200 USD, while the pivotal resistance point stands at the 50-day simple moving average of 28,200 USD.

It's important to keep a close eye on these price levels as they can provide valuable insights into BTC’s immediate trajectory.

Traders and enthusiasts alike are eagerly monitoring these support and resistance zones to gauge market sentiment and potential future movements.

Conclusion

In the realm of cryptocurrency & DeFi, the journey is never devoid of twists and turns, and July and August of 2023 have proven to be no exception. As we reflect on this period, it is evident that the crypto world remains a dynamic and ever-evolving landscape, filled with both challenges and opportunities.

We've witnessed the rise of XRP, the controversial launch of WLD, and the ongoing regulatory discussions in the United States. These events have illuminated the crypto space's complexity and potential. However, they have also underlined the need for careful navigation, as exemplified by the significant DeFi losses and Bitcoin's struggle to overcome key resistance levels.

As researchers in the crypto field, we at CharlieDeFi maintain an unwavering commitment to providing you with informed insights and analysis. We understand that in the world of crypto, knowledge is power, and our aim is to empower you, whether you're a seasoned investor or just starting your journey.

While there may be challenges along the way, remember that every wave in the crypto ocean offers an opportunity to surf toward a brighter future. Stay informed, stay vigilant, and stay confident in your ability to navigate the crypto landscape with style, finesse and profitability.