The previous year, 2022, was marked by many events that made it special. It is increasingly believed that this year may be considered one of the most depressing in history, but is it really so?
In this article, we’re going to go back in time and look at the highlights that affected the crypto community in 2022.
Persisting Binance
At the top of our list of positive events was the cryptocurrency exchange, which has proven to be the most successful and largest trading platform worldwide – Binance.
Over the years, the Binance team has worked tirelessly to expand its reach and establish a presence in almost every market in the world, including the United States, where Binance US was founded.
According to analysts, over the past year, Binance has facilitated digital asset trading for a staggering $22 trillion. This achievement is outstanding and sets Binance apart from its competitors.
The Collapse of FTX
The bankruptcy of FTX is probably one of those events of the past year that hardly anyone has not heard about. Almost at one point, one of the largest cryptocurrency exchanges ceased to exist.
All thanks to CoinDesk, which published a leaked document on November 2. The document revealed that Alameda Research, a hedge fund led by Samuel Bankman-Fried, was holding an abnormally large amount of FTT tokens.
As a result, the exchange’s collateral fell from $60bn to $9bn in a few months. It also affected BlockFi with $250 million loan from FTX, leading to bankruptcy. Overall, this fall caused the crypto industry to lose $9 billion in total.
CoinShares Resurfacing
CoinShares is one of the largest cryptocurrency investment companies in the European area, managing billions of dollars’ worth of cryptocurrencies. The company’s clients include mostly the elite of society, who have great opportunities for investing in digital currency at their disposal.
Today, CoinShares has several offices located in cities such as Jersey City, New York, London, Stockholm, and Paris. Despite the cryptocurrency industry’s downturn, CoinShares’ assets increased considerably, reaching $26 million by the end of the last year, which was a pleasant surprise for both the management and the community.
The Crash of Terra-LUNA
The Terra network started with a head start but ended with a dramatic drop. In April of the same year, the algorithmic stablecoin had a market cap of utmost $18.7 billion before it plummeted in May. The all-time high of $119.18 dropped to as low as $0.10 on May 19. Terra remains among the coins with the highest market value rising to $41 billion.
Terra created USTC, a fiat stablecoin reliant on algorithmic mechanisms. Users can mint USTC tokens by burning the same amount of LUNA tokens or vice versa. What made USTC attractive is the support of Anchor Protocol on Terra which disseminated 20% of the income for the token. This also made LUNA more appealing to the industry.
It did not last long, though. When Terra Development Company sold $450 USTC, it collapsed. As a result, LUNA’s value went down due to the eagerness of USTC holders for redemptions.
Ethereum Merge
The merge of Ethereum brought hope for investors, miners, and everyone involved. This means that the Ethereum blockchain’s consensus mechanism converted to Proof of Stake (PoS) from Proof of Work (PoW).
Ethereum publicized its plan by the end of January 2022 that it will no longer use Ethereum 1.0 and 2.0 (ETH1 and ETH2). Instead, it will be replaced with new terms “execution layer” and “consensus layer.” This merge is the biggest technical upgrade recorded beyond EIP-1559.
Positive results were expected and experienced. Besides the skyrocketing of the token’s price (ETH), it also boosted the ecosystem project tokens.
However, since the successful upgrade on September 15, the supply increased, adding 1,305.24 ETH. The next month, ETH experienced broke its stable record, entering a monthly deflation.
The Sprint of StepN
StepN is one of the most famous chain GameFi in 2022. This game is founded on the Solana chain, allowing users to earn while walking, jogging, running, and sprinting–branded as the “Mover To Earn” game.
The project has won awards which made them appealing to users and investors. In April, the game’s market value went beyond $1 billion. According to 2022 records, there are 1 million users, resulting in $122.5 million in profits quarterly.
The turning point, however, is the retirement of Chinese users. Since then, the game and the GMT token was stuck in a bear market. The GMT token dropped to 91% from its highest record. Nonetheless, StepN remains one of the most popular GameFi/Web3 applications in 2022, which influenced other apps to flourish.
Conclusion
The past year has proven to be a crucial test for the cryptocurrency market, putting its stability and resilience in question. Although there have been many notable events such as the Ripple-SEC case, the fall of Terra Stablecoin and the crypto winter, we have highlighted only the most significant.
One of the main conclusions of 2022 was the risk of using leverage in trade, which can lead to significant losses when the market changes. Nevertheless, the year also demonstrated that the crypto industry offers various advanced financial technologies and investment opportunities attractive to various investors.
Looking ahead, we hope for a positive year full of favorable surprises and joyful news, and we are optimistic about the potential of the cryptocurrency market in 2023.
