Technology

Crypto 2022 Wrap-Up: What happened in Crypto in 2022?

The year 2022 was a long one for crypto traders, investors, and players, considering the ongoing worldwide recession which wrapped itself around the crypto market. But apparently, that wasn’t all that affected the cryptocurrency market this year, a number of events happened, which have changed the face of cryptocurrency, blockchain, and related technology and how we perceive it.

Here are some major crypto-related news of 2022

FTX files for bankruptcy

The collapse of FTX is the most recent and the biggest development in the crypto industry this year. The filing of bankruptcy by the world’s second-largest crypto exchange has left millions of its investors across the globe in debacle and confusion.

The crypto exchange company FTX was founded by Sam Bankman Fried in 2019, within a short span of time the exchange brought in investments from the players in Silicon Valley and Wall Street. FTX gained popularity rapidly and become a household name In the west, especially the in the United States.

FTX an exchange that was trading about $10 billion in a day in July of 2021, took a hit in 2022 when the recession got the better of all the risk assets, including crypto. This period led to news regarding FTX’s mismanagement of funds coming out. It was found that Sam Bankman Fried and his partners siphoned off public money invested through their exchange into another company founded by Sam Bankman, Alameda which itself was on the brink of bankruptcy. This was in violation of not just government rules but also FTX’s own guidelines.

What followed was a downpour of news regarding the constant mismanagement of FTX funds by its top-level management, accusations regarding nepotism, unprofessional organizational structure, and even allegations regarding corruption and involvement of government officials.

FTX operations broke down in the true sense after a tweet from its competitor Binance’s CEO Changpeng Zhao, information that Binance will be liquidating all its investments made in FTX. FTX filed for bankruptcy on 11th November and leading to CEO, Sam Bankman Fried’s arrest from the Bahamas on 12th of December.

FTX exchange has ceased to be operational and all its investors and users are currently dangling on the rails, in confusion, about if they’ll ever receive their money back.

BlockFI declares bankruptcy

FTX’s downfall led to a domino effect affecting the crypto market throughout the world, so much as to engulf several companies in its arc.

BlockFi, a crypto lender and deposit facilitator, who provided returns on dormant crypto tokens, claimed bankruptcy on the same day as FTX, i.e., 11th November, which was preceded by the blocking of deposit withdrawals and followed by letting go of several employees.

Crypto lender Celsius files for bankruptcy

Celsius, founded by Alex Mashinskey and Daniel Leon in 2017, projected itself as the replacement for banks in the future. It started its operation by acting as a lender to crypto organizations and was soon able to operate globally with four offices worldwide.

Celsius’s claims were that they would provide 17% returns on crypto deposits. Just like banks, they involved themselves in diversifying their portfolio with various investments and dealing using the money deposited by the general public. But their claim to difference was that they would provide a huge chunk of profit made from redirecting public deposits back to them.

On 1st July 2022, Celsius filed for bankruptcy. With over a $1.2 billion discrepancy in their balance sheet, Celsius had 1.4 million customers across the globe whose withdrawal privileges were frozen in the month of June. Celsius in the lieu of diversifying public deposits had given out loans to numerous crypto organizations, moreover, they invested their funds into bitcoin mining servers, creating unavailability of liquifiable funds, trickling down to a domino effect of the inability to pay back their depositors and investors, legal suits, closing of exchange and a subsequent collapse.

Filling of bankruptcy by Three Arrows Capital

Three Arrows Capital was a Singapore-based crypto hedge fund company founded in 2012. At its prime, it managed around $10 billion of its investors’ funds. The company filed for bankruptcy on the 1st of July, figures had been coming out regarding how much Three Arrows Capital Owed to its investors, in total it owed $3.5 billion to multiple lenders.

The founders of the Three Arrows Capital, following the suit, went into hiding and are untraceable.

Voyager digital files for bankruptcy

Voyager digital, a crypto exchange firm, was one of the firms that had lent money to Three Arrows Capital and weren’t paid it back.  The amount of settlement was supposed to be $370 million. Voyager Digital declared bankruptcy in July after freezing the withdrawal facility.

Voyager claimed that the major reason for their filing for bankruptcy was Three Arrows Capital’s non-payment of their credit amount.

Over $270 million lost in Crypto frauds in the UK

In the United Kingdom, according to a report by the Financial Times, within the time frame of October 2021 to September 2022, over $270 million were stolen from over 10,000 victims, indicating a 32% rise in crypto-related frauds in the country’s last year.

The mysterious death of 3 crypto giants

What seems to be apparently a grim development in the field of cryptocurrency is a chain of the demise of crypto giants and the subsequent theories that floated around in the market.

The string began with MakerDAO developer and crypto millionaire Nikolai Musheigan’s death, by drowning in Puerto Rico, hours before which he had predicted his own death under mysterious circumstances on Twitter.

Weeks later Amber group’s founder Tiantian Kullander’s sudden demise followed during his sleep. And in less than a month Vyacheslav Taran, the Russian billionaire with high influence in the crypto market passed away in a helicopter crash in Monaco.

Social media and stakeholders went to loggerheads and debates erupted over whether they were coincidences or part of a conspiracy and how these deaths would affect the market and its players.

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G20 intends to build global consensus on Cryptocurrency

In the ongoing finance and central banking meeting of G20, moves are being made to build an internationally relevant consensus and understanding regarding the potential and application of cryptocurrency and other crypto-based assets.

The statement was given by Ajay Seth, India’s federal economic affairs secretary, he also added that- “The regulation should flow from the policy view taken. In fact, one of the priorities which have been put on the table is to help countries build a consensus for a policy approach to the crypto assets”.

The downfall of TerraUSD and Terra

The tokens TerraUSD labeled as UST and Terra labeled as LUNA, were considered to be in the category of stablecoins, i.e., coins that were promising of maintaining at least $1 in price regardless of market fluctuations, with a possibility of high tide in their price. Both Terra and TerraUSD fell down to the amount of pennies towards the end of May. The projects that were riding on these cryptocurrencies also didn’t pan out s expected causing confusion and losses in and among the investors.

Polygon’s mainstreaming by the Indian government

Polygon (Matic) an Indian crypto company has grown and issued collaborations with the Indian government to work in various fields to increase the ease and efficiency of diplomacy and functioning.

Polygon tied up with the Indian state of Maharashtra and worked with the state government to issue caste certificates efficiently to over 65,000 people using their blockchain. This was an attempt made to ensure and apply better technical options under the nation’s Digital India project.

Polygon’s blockchain has also become a suggested feature by government and autonomous bodies like the Securities and Exchange Board of India (SEBI) and Telecom Regulatory Authority of India (TRAI), who have asked their depositors, partakers, and stakeholders to use polygon’s blockchain facility to ensure increased transparency and ease of functioning.

Utilization of a crypto blockchain by bodies of a national government with, talks within G20 moving towards building global consensus on Crypto, shows a possibility of future closing in where Crypto and its related assets and technology become a mainstream part of public life.

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