Memecoin activity up as Bitcoin-S&P 500 correlation hits new high: Binance Research

The cryptocurrency marketcap rose 2.8% in October 2024, according to Binance Research, largely attributed to inflows into Bitcoin spot ETFs and favorable U.S. job data. 

While the market is closely watching for regulatory changes after the U.S. presidential election, it faces challenges, including geopolitical tensions like the Israel-Iran conflict and allegations against Tether .

According to Binance Research, Bitcoin’s correlation with the S&P 500 is approaching record levels as investors are increasingly treating the primary cryptocurrency as both a risk-on asset and a hedge against economic uncertainties. Historically, Bitcoin’s relationship with equities has been weak, with only temporary spikes due to liquidity adjustments or interest rate shifts. 

Other highlights show that out of the top 15 revenue-generating chains and applications, 13 are applications, indicating that much of the industry’s revenue is driven by specific applications rather than the blockchain networks themselves. 

Binance Research suggests that Solana has become the primary blockchain for new token launches, fueled by the launchpad platform pump.fun, which lowered entry barriers for token creation. The trend, however, sparked a wave of speculative trading, with Solana handling 90.6% of all token launches in the week leading up to October 21. 

October saw a rise in memecoin activity, with four of the top five performing tokens being memecoins. Memecoin trading volume has also climbed, hitting around 12% of the top 50 altcoins’ market cap on average—and even breaking past 20% on some days. Since February, daily trading for memecoins hovered around $5 billion.

“Dogecoin topped the list, jumping 33.1% following a reference to the "Department of Government Efficiency" (D.O.G.E) by Elon Musk at a rally,” said Binance Research analysts. “Solana saw a 9.7% increase, spurred by high trading volumes in memecoins and growth in decentralized finance (DeFi) on the Solana network.”

Meanwhile, Toncoin fell by 16.9% amid concerns over privacy following Telegram's policy changes and CEO Pavel Durov's legal challenges. Ripple’s XRP also dropped 20.4% amid its ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC). 

“Tron also recorded gains, up 7.5%, while Binance Coin declined by 2.9% following the exchange’s announcement of a November deadline for the BNB Beacon Chain upgrade. Ethereum (ETH) fell 3.7%, as concerns over high fees and the rise of independent appchains affected investor sentiment,” the report said.

According to the Binance calculations, DeFi’s Total Value Locked (TVL) saw a small bump of 1.0%, riding the wave of October’s on-chain momentum. 

Binance analysts point to growing interest from both institutions and regular users, especially for Solana, which hit $7.6 billion in DeFi TVL. Liquid staking protocols like Jito, Marinade, and Sanctum grabbed a big share of this inflow, while projects like Jupiter and Raydium added essential liquidity to match rising on-chain activity. 

Source: Investing.com