What Happened in Crypto in 2023?
Throughout 2023, cryptocurrency remained a prominent subject, fueled by the introduction of innovations, fluctuations in crypto prices, and various intriguing subtleties.
The past year witnessed significant and captivating developments, encompassing technological advancements and the implementation of crypto regulations. These aspects, in turn, left a lasting impact on the assets and potential investment strategies of users.
The entirety of the 2023 crypto market was steeped in the narrative of 2022, a year dominated by bearish activity. However, by the year's end, the market rebounded, witnessing a substantial increase in asset prices. Concurrently, the United States' primary regulatory body, the SEC, issued pivotal signals regarding the regulation of the crypto industry. Many crypto enthusiasts now eagerly await the release of ETFs.
As noted earlier, the previous year grappled with the lingering effects of 2022, yet Bitcoin emerged triumphant, rewarding its owners. The asset regained its upward trajectory, experiencing a surge of approximately $20,000 in value during the final three months of the year.
Bitcoin and 2023
Despite the challenging macroeconomic conditions prevailing throughout the year, the collective market capitalization of cryptocurrencies demonstrated resilience, surpassing the $1.4 trillion mark, with the eminent cryptocurrency, Bitcoin, playing a pivotal role.
For instance, in the initial month of 2023, Bitcoin's value surged by nearly 50%, catapulting from $16,600 to $24,000. This remarkable performance led the renowned investment firm Goldman Sachs to acclaim Bitcoin as the standout investment asset for January 2023.
Furthermore, the impending release of the Bitcoin ETF is anticipated to significantly contribute to the market capitalization rebound. This development, eagerly awaited by numerous crypto enthusiasts, attracted the attention of the world's largest investment company, BlackRock, managing assets worth $9.4 trillion. Their interest generated heightened customer expectations and positive market signals.
Interestingly, Bitcoin's upward momentum provided fresh incentives for both the cryptocurrency and its holders, fostering increased acquisition and retention of digital assets.
Artificial Intelligence (AI) and 2023
Moreover, the year 2023 marked a significant milestone in artificial intelligence development. Notably, the introduction of the renowned AI product, ChatGPT, gained prominence. Following OpenAI's initiatives, industry giants like Google and Meta expressed keen interest, initiating the development of their AI models.
Beyond the launch of ChatGPT, a pivotal advancement involved transitioning from GPT-3 to GPT-4, enhancing the product's sophistication, intelligence, and personalization. This iteration of artificial intelligence now boasts DALL·E 3 support, enabling the creation of visual images based on dictated text.
The continuous evolution of artificial intelligence has led crypto experts to anticipate the emergence of numerous new industries and opportunities in the future, notably in NFT development and the crypto & Play-to-Earn gaming sectors.
The fervor surrounding artificial intelligence has translated into remarkable growth for AI tokens throughout 2023. The total market capitalization of AI tokens surged from $8 billion to an impressive $28 billion during this period of ongoing development and innovation.
Memes, Meme Coins and 2023
The year 2023 marked a pivotal moment for meme-based cryptocurrencies and their holders, emerging as the primary beneficiaries of the overall growth observed last year.
Driven by various factors, the awareness surrounding cryptocurrencies, particularly Meme Coins, witnessed a significant surge in 2023. This heightened interest translated into increased buying activity, consequently propelling the prices of these cryptos to unprecedented levels.
Illustratively, the Shiba Inu Meme Coin concluded the year with positive growth, boasting a notable increase of 2.35% throughout 2023 and nearing a market capitalization of $5 billion. Dogecoin, too, kept pace, delivering a satisfying 18.78% growth, while the standout performer among meme coins in terms of year-to-date percentage growth was the renowned Pepe (PEPE). Remarkably, Pepe experienced an extraordinary surge of 456%, culminating in a total market capitalization of $444 million.
Ripple vs. SEC
The year 2023 held significant implications for Ripple and the broader spectrum of altcoins. Throughout the year, the ongoing litigation between Ripple and the SEC took center stage in discussions, as did the overarching theme of crypto regulations.
The crypto market witnessed considerable turbulence following the SEC's 2020 lawsuit against Ripple and its founder, Chris Larsen. However, pivotal developments in the case unfolded in 2023.
The SEC asserted that Ripple qualified as a traditional investment asset, thereby necessitating adherence to existing legislation. Such a classification would inherently place all altcoins in a similar regulatory category, sparking concerns about an impending wave of regulations.
Nevertheless, Ripple secured victories on several crucial fronts. It was officially recognized as a cryptocurrency eligible for trading on crypto exchanges, sidestepping additional regulatory burdens. Furthermore, the market's response signaled a reaffirmation of cryptocurrency as a genuinely decentralized asset. This not only bolstered Ripple's standing but also spurred a collective uptick in prices for altcoins across the board.
FTX, Binance and CZ
Despite the positive signals, 2023 witnessed some upheavals within the crypto community.
In 2022, Sam Bankman-Fried, the founder of FTX, was recognized as the most influential person of the year. However, precisely one year later, on November 3, 2023, a court found him guilty of seven counts of misappropriation of assets.
The crypto community also mourned the loss of another prominent figure, Changpeng Zhao, widely known as CZ, the creator of Binance. He faced charges related to unlicensed transactions, constituting a serious violation of American banking regulations. CZ's trial is slated for February 2024. These developments underscored the challenges and legal complexities faced by influential figures within the crypto industry.
What important events occurred during each month of 2023?
January – Crypto Market Capitalization skyrocketed!
January of the previous year proved to be a pivotal moment for the crypto industry, with the total market capitalization of the cryptocurrency market soaring to an unprecedented $1 trillion in the initial month of the year.
February – SEC and Staking
In February, the SEC intervened in Kraken's staking system, imposing a substantial fine of $30 million on the company.
March – The very first steps of Bitcoin Ordinals
Efforts commenced on transactions involving the smallest unit of Bitcoin, the satoshi. This initiative involved uploading diverse and unique information in the form of images, audio files, and videos.
April – The rise of PEPE
PEPE, a notable representative of meme coins, experienced an astounding 1000-fold increase in its price within a single month.
May – New Era for Meme Coins
Following PEPE's surge in April, the momentum continued with other meme coins, defining a period marked by the widespread growth of these digital assets (Meme Coins).
In a matter of just a few days in May, meme cryptocurrencies like Bob, Ladys, and Miladay witnessed an impressive twentyfold increase in value.
June – Crypto Regulations
June 2023 witnessed the activation of the SEC and the implementation of new regulations, leading to significant repercussions for major crypto exchanges, including Coinbase, which faced heightened restrictions.
Simultaneously, MasterCard demonstrated a keen interest in the blockchain industry and crypto adaptation during this period.
July - Artificial Intelligence and Cryptocurrency
In July, the introduction of WorldCoin came to light, a venture announced by the CEO of OpenAI, Sam Altman. The objective of WorldCoin is to establish a universal cryptocurrency for the world, marking a significant intersection of the paths of artificial intelligence and cryptocurrencies.
August – PayPal and Cryptocurrency
August 2023 marked a historic moment as one of the world's largest payment system companies, PayPal, expressed interest in crypto transactions and ventured into the creation of its own stable cryptocurrency.
October – downfall of FTX
The most crucial event in October was the unfolding developments surrounding the CEO of FTX, as Sam Bankman was initially accused of money laundering and fraud. FTX became the epicenter of challenges for some of the largest crypto exchanges in 2023.
November – Binance Problem
As mentioned earlier, October proved challenging for the CEO of FTX. In November 2023, the focus shifted to the next major exchange, Binance, and its founder CZ.
Binance faced significant regulatory issues, culminating in the payment of a substantial $4.3 billion in fines for existing violations. Furthermore, the founder, CZ, had to personally settle a $50 million fine amid these challenges.
December – Rise in prices
The final month of 2023 marked the early onset of the upcoming Bull Market, instilling hope for crypto investors akin to a visit from Santa Claus.
In December, Bitcoin initiated its most rapid ascent, signaling a robust recovery in its price. The crypto industry concluded the last days of 2023 on a positive note, setting an optimistic tone for the future.
10 Things We Expect in Crypto in 2024
Indeed, 2023 proved to be a turbulent year for the entire crypto world. However, the rising prices of cryptocurrencies signaled a positive end to the year.
As 2024 unfolds, positive signals continue to accompany many cryptocurrencies. Anticipation is building for various products, planned upgrades, and halving events, further fueling the optimism within the crypto community.
Expectation 1 – Bitcoin will hit $80,000.
Throughout 2023, Bitcoin demonstrated remarkable growth, surpassing all other assets and stocks with an impressive 128% increase.
For comparison, the S&P 500 exhibited a 21% increase, and the price of gold saw a 12% rise.
Many investors are optimistic about the continuation of this trend into 2024, predicting the potential for a new record and an all-time high. Speculations suggest that the price of Bitcoin could surpass the $80,000 mark.
Two key events are often cited as driving factors for this anticipated surge—the introduction of a Bitcoin ETF expected in the first half of 2024, likely to have a significant positive impact on the cryptocurrency's price, and the Bitcoin halving scheduled for April. Historical patterns indicate that the price of Bitcoin has tended to increase after each halving event.
Expectation 2 – Bitcoin ETF
Numerous analysts and reputable publications are forecasting the availability of Bitcoin ETFs in the first half of 2024.
For instance, Bloomberg's ETFs analyst anticipates the product's introduction within the initial three months of 2024.
Various sources project that Bitcoin ETFs could secure 1% of the current ETF market share. This estimate translates into an approximate $72 billion influx into the crypto industry over the next five years, reflecting the potential impact and growing interest in cryptocurrency investment products.
Expectation 3 – Bitcoin Halving
Similar to 2023, the focal point in 2024 is expected to revolve around Bitcoin, with particular attention directed towards the upcoming Bitcoin halving event in April.
During this anticipated halving, the reward allocated to miners for mining and verifying Bitcoin transactions will be halved. Presently standing at 6.25 BTC, the reward is poised to reduce to 3.125 BTC after the scheduled halving in 2024. This event is closely monitored by the crypto community as it historically impacts the dynamics of the Bitcoin market and influences investor sentiments.
Expectation 4 – The Rise of the Stable Cryptocurrencies
Stable cryptocurrencies have been steadily gaining popularity, and 2023 was no exception. Over the past four years, their total market capitalization has surged to $137 billion.
In the last year, the popularity of transfers involving stable cryptocurrencies has witnessed significant growth. Within the crypto community, there is an optimistic expectation that this trend will persist, with an anticipation that more individuals will opt for stable crypto for payments, potentially surpassing the usage of traditional Visa services.
Expectation 5 – J.P. Morgan and Tokenization
As of 2023, assets totaling $5.5 billion, including stocks, securities, real estate, and more, have been tokenized and integrated into the blockchain.
The Global Financial Markets Association (GFMA) projects that by 2030, a staggering $16 trillion worth of assets will undergo tokenization and be incorporated into the blockchain.
This emerging trend has caught the attention of J.P. Morgan, the world's largest bank, which has demonstrated a serious interest in blockchain technology. Recently, J.P. Morgan conducted tests on tokenization using the Avalanche blockchain. Crypto enthusiasts are closely monitoring J.P. Morgan's initiatives, with expectations that 2024 might indeed become the year of widespread asset tokenization.
Expectation 6 – Ethereum income will double.
Blockchain technologies akin to Ethereum serve as conduits for the circulation of fiat currencies. While cryptocurrencies are distinct from national currencies, various applications and services within the Ethereum network enable users to make payments using fiat currencies.
In 2023, consumers paid $2.3 billion in fees for utilizing these services. Given the rapid adoption of cryptocurrencies, particularly with Ethereum emerging as the fastest-growing crypto asset in this domain, there is an expectation that the revenue generated by the Ethereum network could potentially double, reaching around $5 billion. This underscores the increasing integration of blockchain technologies into mainstream financial transactions.
Expectation 7 – NFT is on the rise?
As of 2023, Taylor Swift holds the title of the most famous musician globally, with her albums amassing an impressive 26 billion listens on Spotify alone.
In addition to her musical success, Taylor Swift is renowned for her positive attitude towards technology and her openness to innovation. Following in the footsteps of artists like Snoop Dogg and Eminem, Taylor Swift is now venturing into the world of NFT (Non-Fungible Token) technologies.
In collaboration with Spotify, she is testing a new token-dependent service. This innovative platform allows users to access specific music only if they own the corresponding NFT associated with the content.
The involvement of the world's most popular and listened-to singer in the NFT industry is expected to bring about a significant revitalization of the NFT field, showcasing the growing intersection between the music industry and blockchain-based technologies.
Expectation 8 - Artificial intelligence and Cryptocurrency
Indeed, we find ourselves in an era marked by remarkable technological advancements, with artificial intelligence playing a pivotal role. In 2023, ChatGPT has emerged as the fastest-growing platform, amassing 5 million users, and highlighting the widespread popularity of AI.
This surge in AI usage sets the stage for intriguing possibilities at the intersection of artificial intelligence and cryptocurrencies. The rise of AI "agents" is a notable trend, representing technology imbued with artificial intelligence that can execute tasks throughout the day, functioning as a personal assistant.
The true potential of these AI agents will materialize when they can go beyond merely searching for information and actively execute actions. For instance, not just finding a flight ticket but having the capability to purchase it. This is where cryptocurrencies come into play, offering a more seamless integration with AI compared to traditional fiat currencies. The synergy between artificial intelligence and cryptocurrencies holds the promise of unlocking new and efficient ways for technology to interact with and manipulate digital assets.
Expectation 9 – Crypto Staking and Betting
Placing bets on various events has been a longstanding human practice, and with the advent of cryptocurrency, the industry has undergone further sophistication. Crypto platforms now allow individuals to wager on a diverse range of events, from political outcomes like the next U.S. president to environmental factors like the pace of global warming or even the launch of a Bitcoin ETF on a specific date, such as January 15, 2024.
Cryptocurrency platforms leverage smart contracts and similar technologies to enhance the betting experience, introducing more flexibility and efficiency into the process. The decentralized and boundary-less nature of crypto assets makes them ideal for facilitating these bets.
This trend extends to sports betting as well, where cryptocurrencies are making significant inroads. The integration of cryptocurrencies into the sports betting industry opens up new opportunities for millions of people, contributing to the overall growth and adoption of cryptocurrencies. The marriage of crypto and betting not only reflects the technological advancements but also the evolving dynamics of traditional practices in the digital age.
Expectation 10 – Fee fall Ethereum will drop down
As we've mentioned several times, many people are waiting for the Bitcoin ETF for various reasons, but the most important event will be EIP-4844, which will mean the upgrade of Ethereum, which will lead to record low transaction fees for Ethereum transactions.
Currently, the transaction fee for Ethereum is around $0.14, and after the update, this number is expected to be $0.001.