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Review of the Cryptocurrency Industry 2022

  • 10 Jan, 2023
Review of the Cryptocurrency Industry 2022

2022 - the year of the bear for cryptocurrency. It wasn’t exactly the year we expected or wanted. However, in spite of the downturn, it was still a very eventful year for the cryptocurrency industry.

Unfortunately for the crypto community, there have still been negative lingering effects from the Covid-19 pandemic, combined with the numerous political issues that have affected the world this year, it has made it a make-or-break year for many of us with our funds.

Crypto Industry 2022 Stats, USA, and UK Updates

If we look purely at the statistical facts of how Bitcoin and Ethereum changed from 2021 to 2022 it does leave us feeling a little flat to see the drops of 65% for BTC and 67% for ETH. 

The year started fairly positively with Joe Biden, U.S. President, announcing a new legislation to appropriately monitor the development of digital assets responsibly. Given the collapse of Terra USD, this was a move that was needed by the US leader. 

Across the water to the UK, there was also some positive movement seen from the UK Government on cryptocurrency regulation and the potential for the adoption of stablecoins.

In April 2022, Rishi Sunak, Chancellor of the Exchequer at the time, now UK Prime Minister, said:

“It’s my ambition to make the UK a global hub for crypto asset technology, and the measures we’ve outlined today will help to ensure firms can invest, innovate and scale up in this country." GOV.UK

Could 2023 be the year we see the UK become more of a crypto hub in the world as Rishi said? You can read more about Rishi’s comments here.

Banks, Regulations and Crypto Mining Companies

The continual changes that banks are making across the world will continue to greatly affect the global cryptocurrency industry, in particular, last year the moves made by many Asian banks had negative implications for crypto. When it comes to banks and regulations we are simply playing a game of patience, waiting for them to put in place the appropriate regulations and procedures to become compatible with digital assets.

Back to some facts and figures again! Cryptocurrency mining individuals and companies worldwide struggled massively over 2022 through having to deal with a strong galeforce of pushbacks such as the economic and geopolitical factors, combine that with the inflation rates it is no surprise that this area of the cryptocurrency industry struggled so much. Even one of the top-performing crypto mining companies, CleanSpark, still lost a staggering 79% in 2022.

A positive pushback that we saw from this though was in the amount of fundraising that companies have achieved for their cryptocurrency ventures in 2022. With the continuance of adoption and awareness of crypto still spreading globally, many companies and individuals have continued to pump money into the research and development of these ventures due to their certainty and confidence in the cryptocurrency industry. With the figure being close to $30 billion fundraised it is a serious show of strength and resilience in the crypto community.

2022 crypto review

Ethereum 2.0 and the Collapse of FTX

September 2022 brought around the official Ethereum 2.0 upgrade which had been widely anticipated by those who back ether and the wider crypto community as a whole. The upgrade was set to improve the scalability, sustainability and security of Ethereum, all things greatly valued by the crypto community and the wider economy too. The main upgrade point was that Ethereum would switch from proof of work to proof of stake.

You can read more about the Ethereum 2.0 upgrade here.

In the closing months of the year, we saw one of the biggest hits to the industry with the collapse of FTX due to bankruptcy. This led to decentralised exchanges taking up a higher share of total crypto spot trading volume.

Strength of the Crypto Community

With the year rounding off with such a big blow to the industry it is no surprise that we continued to class it as being in a crypto winter, which arguably it still is into the new year as well.

However, in spite of a shaky 2022 for the cryptocurrency industry, the community that backs it remains strong. In spite of the volatility of this industry with events such as the collapse of LUNA and FTX, those that believe in crypto are continuing to work hard to make a change worldwide.

Communities that back the likes of Bitcoin, Ethereum and XRP do not appear to be shaken up at all by the crypto winter and continue to regularly trade or hold their assets with a belief that this year will be an improvement on the previous.

At the close of 2022, the number of known crypto owners surpassed 400 million, reaching 402 million. Depending on market conditions and external factors ahead of us in 2023, we can anticipate the number of global cryptocurrency owners has the potential to reach 600 – 800 million.

Closing Statements on the 2022 Crypto Review and 2023 Comments

Whilst we cannot predict the year ahead nor do we offer personal finance advice, we can say with certainty that 2023 will face many challenges off the back of 2022 from regulations, to confidence in crypto and further external factors.

But, with that said, the team at AutoCoinCars are already feeling very positive about the year ahead. With new partnered dealerships on board already to kick off the new year and a surge in sales for January, there is still plenty to be excited about this year for crypto!

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