2023 Recap

Before we discuss 2023, let's first look back on 2022. As most of us know, 2022 was an absolutely brutal year for cryptocurrency investors. The market peaked around November 2021, and from there through the end of 2022 it was basically nothing but a downward trajectory. Looking at Bitcoin as an example, in mid-November of 2021 BTC peaked around $64,158. At the end of the 2022 BTC had cratered to to $16,548. The story was similar with other large market-cap cryptos such as ETH, SOL, and LTC. There were a variety of things that caused what became a 13 month bear run, some of which include:

• The spectacular collapse of LUNA, a roughly $60B eco-system that went to zero.

• The implosion of FTX, and resulting fallout that also caused other companies to fail, as FTX owed them substantial amounts of money (BlockFi, Genesis, and others).

• "Cheap" money dried up, as interest rates began to rise and there was no more COVID/economic relief money available.

• The failure of crypto lender Celsius Network, who filed for Chapter 11 bankruptcy in July 2022.

• "Average" investors started losing interest in crypto and NFTs. When prices were rising everyone was discussing crypto as the currency of the future. When prices started dropping, people shifted their attention elsewhere.

For investors who hung on through the challenging times of 2022, the new year brought better news. While there were still some instances of bad news, such as Binance being fined a whopping $4B, and Changpeng Zhao (CZ) stepping down as CEO, there have been positive developments as well, such as:

• XRP (Ripple) winning their court case against the SEC.

• "Bad actors" such as Bankman-Fried, being flushed out of the crypto ecosystem, and receiving harsh punishment for his crimes.

• Strong year-to-date performance for a variety of cryptocurrencies (see table below for examples):

What I would like to see in 2024 is more clarity from the SEC on their position regarding crypto. It seems that they have been slow to set guidelines, and have instead just focused on slapping various companies with large fines. I have included a link below to an article by CoinDesk, where one critic was quoted as saying "Gary Gensler is a politician masquerading as a regulator".

https://www.coindesk.com/consensus-magazine/2023/11/29/a-politician-masquerading-as-a-regulator-3-takeaways-from-fortunes-gary-gensler-profile/