1/ Having spent most of 2022 in stablecoins and on the sidelines, I think 2023 could be a very challenging but pivotal year for the future of crypto that will create a lot of opportunities. Here are some predictions / really important things I think to keep an eye on
2/ Genesis of DCG files for Chapter 11, leaving a huge loan for DCG to cover which will result in at least part of the GBTC trust being sold / unwound creating a lot of additional BTC selling pressure and lack of liquidity / credit.
3/ After many years of waiting victims of Mt Gox will finally receive ~140,000 BTC currently held by the trustee.
4/ After the recent victory against LBRY, the SEC will win in the case against Ripple (which will then be appealed). The outcome of this case will have enormous consequences for crypto in the US and if the SEC is victorious, expect to see a flurry of enforcement actions to follow
5/ with exchanges being forced to delist the vast majority of tokens to US citizens. (This will hit Coinbase particularly hard given their large user base in the US compared to elsewhere). Whilst I want Ripple to win (and everyone in crypto should), I just can't see them making
6/ such a radical ruling which would have knock-on effects for the $100 trillion securities market (if securities can just list crypto tokens with similar models and not have to face the strict compliance laws why wouldn't everyone just move to crypto and follow that model?)
7/ Especially given the timing as we enter a global recession. Faced with US citizens being unable to easily trade many cryptocurrencies due to being delisted from exchanges, we could see a large consolidation of alts into the few which have more regulatory clarity.
8/ This will also have consequences for DeFi and think we will see some permissioned DeFi next year as well as more controls being enforced - IP blacklists and potentially also KYC. DeFi will continue to struggle with high interest rates being offered elsewhere with lower risk.
9/ Faced with the additional compliance / regulatory risks and treasury funds running low, we will likely see many projects close down.
10/ Whilst at the same time regulatory clarity and familiarity with compliance opens the door for traditional finance players to become more prominent in this space which ultimately enables more integration with the traditional markets and sets foundation for wider adoption.
11/ Outside of the US, other places like the UK and Europe, crypto could prosper with more friendly regulation. We will see more testing / rollouts of CBDCs as well as bank issued stablecoins.
12/ Russia will either use Bitcoin or Ethereum for cross-border settlement. They will issue assets consisting of local currency as well as commodities likely on a private instance of Ethereum and interoperate and use public Ethereum for settlement.
13/ This will create further regulatory focus on crypto besides all the FTX fraud and everything else going on, as it's now being used to bypass sanctions and fund Russia's war against Ukraine (which will escalate further in 2023). Censorship resistance of crypto will be tested.
14/ Sam Trabucco and Nishad Singh will also be arrested for their roles in the FTX fraud. Sam Bankman Fried will plead guilty and potentially offer information that leads to further investigations in Binance and Tether in an attempt to reduce his sentence length.
15/ Within the turmoil above and as we enter global recession with stocks likely to fall on Q1 earnings I think price wise we have another leg down in the first half of 2023 but this creates some incredible buying opportunities for some assets for those with cash on the sidelines
16/ Another year where survival is the main goal, but depending on key decisions such as what happens with Genesis / DCG / Grayscale as well as the SEC vs Ripple case the outcome could be very different and in fact be very bullish rather than the some of the bearish takes above.
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