Bitcoin 2022 Annual Review: Market, On-chain Data and Application Development

In 2022, affected by the global liquidity tightening, Bitcoin ended the bull market of the previous two years and entered a volatile bear market. The coin price fell below $20,000, and leading institutions faced consecutive blowouts, severely impacting market confidence. This article reviews the important changes of Bitcoin in 2022 from aspects such as the trading market, on-chain fundamentals, chip structure, mining, and applications.

Trading Market

• The price of Bitcoin has fallen more than 65% throughout the year, showing a "stair-step" decline pattern.
• The exchange's Bitcoin supply has decreased by 533,700 coins, a decline of 20.20%.
• The market's estimated leverage ratio has fallen from a high of 40.47% to below 30%.
• The institutional holdings decreased mildly by 4.54%, and the off-exchange premium rate dropped to -44%.

on-chain fundamentals

• The average monthly active addresses are 27.82 million, a year-on-year decrease of 7.67%.
• Added 141 million addresses, a year-on-year decrease of 9.50%
• Total trading volume of 88.99 million times for the year, a year-on-year decrease of 4.13%
• Total transaction volume of 1.256 billion BTC, a year-on-year increase of 36.37%
• Cumulative transaction fees of 137 million USD, showing a downward trend.

Chip and Address Structure

• The average proportion of profitable chips is 60.50%, showing a downward trend throughout the year.
• The concentration of chips at "whale" addresses first increases and then decreases.
• The number of small addresses has grown significantly, with a notable increase in addresses holding less than 10 BTC.
• The proportion of chips held for 1-2 years has increased the most, reaching 20.37%.

Mining Status

• The overall network computing power has moderately increased by 11.21%, with an average of 218.5 EH/s per day.
• The unit hash rate revenue decreased from $0.25 to $0.06, a decline of 76%.
• The overall selling pressure from miners is relatively small, with an MPI average of -0.52.

Application Development

• The number of Lightning Network channels decreased by 18.53% to 67,700.
• The capacity of the Lightning Network increased by 46.19% to 4760 BTC
• The total amount of WBTC has decreased by 24.48% to 194,900 coins.

Overall, Bitcoin experienced significant market adjustments in 2022, but the on-chain fundamentals remained relatively stable. In the future, as the macro environment improves, Bitcoin is expected to re-enter an upward trajectory.