What’s on the Agenda for Crypto in 2023?

This article was co-written by Charles Ellingsen, Founder and CEO of Unity Network.

Crypto in 2023 will have to recover from the many dramatic moments that highlighted crypto in 2022. While times were tough, the lessons we take from those 365 days can be long lasting if we play our cards right.

What propelled the industry, albeit harsh, was greed. And we have seen it before. Think back to the 1980s, which was known as the ‘Decade of Greed.’

“Greed is good,” according to the infamous Gordon Gekko. But is it?

Greed incites people to have more of everything – wealth, influence and status – and they seek to accomplish it within a very short period of time. People aren’t inherently all good, which means that not all greed is good. Access to wealth can corrupt even people with good intentions – as we have seen.

Without a regulatory framework, greedy people have an easier time ‘getting their shot’ so to say. One lesson we’ve learned is that the crypto space needs to grow up and mature. If we want to be beneficial to all mankind, we don’t want to think about a new Lamborghini or Bugatti as the incentive to make a use case work. We need to create a true safe space and good working alternatives to normal banks and centralized brokerages, among other things.

Crypto in 2023 and the shape the future for the industry

The failures the industry saw in 2022 are shaping both the retail and institutional adoption of cryptocurrencies in the future. There is no doubt retail investment trust has been shaken.

We saw some of the largest names go down in flames.

Celsius, a one-time force to be reckoned with that promised a new way of banking and a staple on most conference agendas, became insolvent and eventually filed for bankruptcy earlier in 2022. Their woes continue as they are currently being sued by New York’s Attorney General for misleading investors.

We then experienced the TerraUSD (UST) collapse, the 3AC failure, and, of course, we closed out the year with some fireworks – Sam Bankman-Fried’s FTX collapse.

The latter unearthed a Ponzi scheme for the ages, which will continue to have repercussions on other industry players for some time.

While institutional adoption is slowly continuing, it will do so with way more vigilance than before the FTX and 3AC debacles sullied public opinion. Moreover, an economic downturn, high inflation and recession fears have investors running scared and worried about when the next shoe will drop. 

But the technology works

When something in the digital ecosystem goes awry, blockchain technology, Web3 and crypto are often painted as criminal, dangerous and high risk.

These calamities are nearly always a result of a few centralized players with illicit intents. What the media doesn’t always  point out, in these instances, is that these events are caused by people and not by technology. It simply does not reflect the actions of a decentralized ecosystem.

The transparency of the blockchains digital ledger enables anyone to review transactions, making it harder for criminals and people with illicit intent to cover their tracks.

Case in point is the fact FTX was found out much faster than Bernie Madoff. The latter’s fraudulent investment scheme went on for much longer. While both are an abomination to the people they served and the industry they were respectively a part of, SBF did not enjoy decades of pillaging before he was exposed as a fraud.

Forbes recently published an article about a Mexican drug gang who tried to launder money over the Binance crypto exchange – and was stopped in his tracks. This is an excellent example of how the transparency of crypto actually repels criminals with illicit intents.

We anticipate more positive news like this coming to light this year.

Bottom line: it comes down to regulation

No matter how many solid use cases there are and no matter how many pundits give their seal of approval to the industry, here’s the bottom line: global regulations in cryptocurrencies need to continue.

In certain areas, regulatory proposals are looking good. This is especially true in Europe with the new MiCA regulations, as well as some countries in South America that have successfully implemented regulations, allowing for earlier adoption. Brazil is leading the way.

The US, on the other hand, has a long way to go. Yet, the industry needs the US for global adoption.

The SEC and US government must step their game up to avoid falling behind other parts of the world in this regard, especially if they want to be a crypto-friendly country. Business and political leaders do recognize that, regardless of the current “winter” conditions, digital assets as a whole are not going anywhere.