Since the inception of the first cryptocurrency Bitcoin around 14 years ago, the question Is cryptocurrency going to die has surfaced numerous times. If we look at the history of cryptocurrency that found its genesis in the emergence of Bitcoin, it is pretty clear that every time the hype of cryptocurrency death has ended with crypto market rose to new highs. After a long stagnant and negative trend in the cryptocurrency market, people across social media have started to speculate if this is the end of cryptocurrency. And some even asked the question if crypto dying in 2023. The answer is clearly undoubtedly no. In this article, we will go through vital points that shows the strength and weakness of the crypto market and where it is heading this year.
Rapidly Evolving Crypto Ecosystem
The total crypto market cap that currently stands at over $1 trillion and already hit the $3 trillion market around a couple of years ago is not an easy target for governments or organizations that work on targeting its flaws and preventing its further development. There are around 22,423 cryptocurrencies and 537 crypto exchanges actively working as of now according to Coinmarketcap data. The total market cap of Bitcoin alone exceeds the market cap of leading global firms Walmart and Mastercard by a considerable margin.
The real money invested in the crypto market shows people believe in the technology behind this booming sector. Major tech giants such as Microsoft are already accepting payment in Bitcoin. Coca-Cola, Home Depot, and BMW have also included Bitcoin in their list of accepted payment methods.
Metaverse is another aspect of blockchain technology that is redefining the virtual reality. According to Emergence research report Metaverse Market Size will increase to $1.6 Trillion in 2030 and estimate to register a CAGR (Compound annual growth rate) of 43.3%.
This tremendous growth in the crypto projects thoroughly contradicts the claim is crypto dying in 2023. Instead, it forecasts the upcoming surge in crypto market in coming years.
Crypto projects that may change the world
XRP Planning to take over SWIFT
Ripple Labs’ native cryptocurrency XRP has emerged to be the cheapest and fastest way to transfer money across the world. This blockchain project has claimed to have the potential to disrupt the global payment system. While the traditional system takes a long time to process a cross-border transition with the involvement of many intermediatory and huge fees, XRP takes hardly 5 to 6 seconds to process payment from one place to anywhere in the world and that comes at a negligible fee. Ripple Labs has created Ripplenet, a framework designed to suit and cater to the needs of banking and financial institutions. It could be used to make a nearly real-time and cost-effective payment transfer across the globe. As per Ripple Labs, this groundbreaking technology can handle the requirement of a faster payment settlement system and save billions of dollars that are paid to intermediaries while making international payments through SWIFT.
Ethereum is a real gem of the crypto landscape
the top 2nd cryptocurrency Ethereum has completely changed the way blockchain technology could be utilized for real-world causes. There are massive projects that are built over Ethereum and offer solutions ranging from decentralized finance to creating a non-fungible token (NFT). Ethereum has recently adopted a consensus method that consumes ridiculously less energy than its predecessor. It shows that crypto projects are flexible and willing to update themselves for a better world.
Stablecoin, transcending the US dollar barrier
The major flaw with using cryptocurrencies as a payment method is the high volatility in their price. A Bitcoin transferred to a person may decrease or increase in value considerably within a day or a week. In contrast, a stablecoin as the name suggests does not have any changes in its value. Moreover, the fee charged for transactions in stablecoin is extremely low which makes it another lucrative method for making payments. Fund transfer in USD tether which is pegged in 1:1 with the US dollar, through the TRC 20 network only cost $1 despite the amount of fund being transferred. The revolutionary change unleased by stablecoins alone shows contrary to the assumption is crypto dying in 2023, it would be safe to say crypto is only going to position itself for a transformation in upcoming years.
The market cap of this crypto segment has witnessed remarkable growth in its market cap which indicates potential growth in its adoption as a preferred payment method over the US dollar.
Along with these prominent projects, there are many other wonderful blockchain-based initiatives that are outshining their traditional competitors.
Stories that maligned Crypto image
2022 could be considered the worst chapter in the history of Crypto. Terraform Labs LUNA cryptocurrency which was once worth more than $50 billion had fallen to the bottom. This tragic event has worked to trigger a chain of many other catastrophic events in the crypto market like the bankruptcy of 3 arrow capital, Celsius a crypto lender, etc. Furthermore, it has created a void in the crypto world that is yet to be filled completely.
FTX Falling to Pieces
Once a crypto empire, a lifesaver of crumbling crypto projects has fallen from grace at a time when no one had a clue about it. The collapse of FTX has raised many questions about the internal infrastructure of a crypto firm, awareness of financial and regulatory bodies on crypto companies, and most importantly the safety of users hard earned money. A whopping $3 billion in funds are still stuck at FTX, and there is no certainty about releasing the funds to stockholders anytime soon.
Billions of funds stolen
Hacks and rug pulls are rampant in the crypto ecosystem owning to many technological and human errors. Nevertheless, the year 2022 was the year with a staggering amount of funds ever hacked from many crypto firms. Metaverse and gaming firm Axie Infinity’s Ronin Bridge hack resulted in a loss of $625 million fund. Around $325 million was stolen from Wormhole Bridge through exploiting the technical loopholes by hackers. In a series of other such hacks, hackers targeted the technical fault in a crypto infrastructure and got away with more than $600 million fund.
Along with these major shortcomings, the sprouting of many hollow crypto projects only aimed to steal users’ funds such as the Squid game token, were the serious issues faced by the crypto. However, with increasing awareness, regulatory restrictions, and maturation of the crypto market, the year 2023 is only expected to weed out such phony projects.
Is Crypto destined for Extinction in 2023?
Although the crypto ecosystem is still fragile and requires enormous improvement in order to gain the trust of users. Areas that require major enhancement are fixing technical loopholes that make crypto heaven for hackers. A proper and unified regulatory framework is imperative to prevent any other instance of FTX. Furthermore, it will restore users’ faith in crypto and assure them about the safety of their funds. It is pretty far to bring and embed crypto trading and other such activities into the financial fabric of a country but a regulatory body to oversee the activities of crypto exchanges is the need of the hour. Going back to question is crypto dying in 2023, the answer seems pretty obvious despite many obstacles in the way ahead.
Considering the strength and drawbacks of the crypto ecosystem, it is not difficult to assume that crypto is not going anywhere but to bloom, flourish and continue its adoption around the globe. El Salvador government’s adoption of Bitcoin as legal tender and moves to bring a bond based on BTC shows the real potential of Bitcoin and cryptocurrencies.
A Digital Entrepreneur and Co-Founder at CoinFea.com. Pritam’s keen interest in Blockchain and Fintech lead him to establish an independent media publishing house CoinFea.
Pritam loves to generate new ideas and devise feasible solutions to broadly relevant problems.