2023: Crypto Market Experiences Seismic Events, Regulatory Uncertainty, and Possible Ethereum Withdrawal Relief

Crypto market experienced a tumultuous year in 2022, and its reverberations will continue to be felt in 2023. in the wake of the collapse of crypto exchange ftx, other crypto firms were affected, leading to bankruptcies, frozen withdrawals, and exposure to millions of dollars in losses. the american government has yet to provide clear regulatory guidelines for crypto assets, protocols, and exchanges. democrats and republicans are narrowly split in control of congress, making it unlikely that sweeping crypto regulatory legislation will be passed.

Collapse of ftx happened in 2022, and its effects are being felt around the world. the digital commodities consumer protection act (dccpa) was all-but doomed after its most prominent supporter, sam bankman-fried, was disgraced. maxine waters (d-ca) and patrick mchenry (r-nc) have been working towards a stablecoin bill since facebook’s attempt to create its own stablecoin, libra. the securities exchange commission (sec) is releasing a suite of updates to the agency’s rules on security exchanges, which could have devastating consequences for defi if adopted in its current form.

Collapse of ftx happened due to a combination of factors. ethereum users may finally be able to withdraw their staked eth after the shanghai upgrade launches in march, and developers hope that the network’s cancun upgrade, which follows shanghai, will include proto-danksharding, a process which will make ethereum transactions faster and cheaper. marius van der wijden, a core ethereum developer, is “very confident” that proto-danksharding will be shipped by the end of 2023. the full impact of ftx’s $32 billion collapse is yet to be accounted for, and its myriad connections are yet to be divulged and processed. even if the sec manages to get a favourable ruling in the ripple case, the agency could still face a long legal battle in their efforts to shake up the crypto industry. it is unlikely that a crypto spring will take hold in 2023.


By Evey Lovelace

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