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A disastrous year that saw few winners among a sea of ​​losers

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2022 was supposed to be the year crypto went mainstream, with a raft of traditional venture capital firms betting heavily on the ecosystem in 2021. However, with one disaster after another, 2022 turned out to be a disastrous year for the crypto ecosystem. emerging environmental. Turns out some of the biggest names touted as pivotal to the crypto ecosystem moving forward were the orchestrators of their worst year in recent memory.

Having said that, quite a few characters rose to the occasion. These winners prove that crypto is not just about a select few individuals and companies, but also about a vibrant ecosystem that can withstand major setbacks.

Let’s start with some of the biggest winners in the crypto ecosystem in 2022. The list includes anonymous individuals, companies, and groups working for the betterment of the industry.

winners

In a year that has seen the multi-billion dollar Terra ecosystem, FTX, and Three Arrows Capital collapse, it’s hard to pick the winners. However, cryptocurrencies have faced opponents before, and 2022 was no different. Many positives came during the year despite the collapse of several central entities.

Ledger and Trezor

When Satoshi Nakamoto created Bitcoin (BTC), the basic idea was to give people financial sovereignty that would make them less dependent on centralized intermediaries.

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With offers of lucrative interest rates on yielding products and derivatives trading services, most cryptocurrency users have preferred to hold their crypto assets on centralized exchanges. However, these lucrative offers become a nightmare when millions of customers lose their money in the aftermath of the central exchange market crash.

Amid the ruins of the FTX collapse, cryptocurrency investors have lost faith in centralized exchanges. Hardware wallet providers such as Ledger and Trezor have benefited from investors shifting their behavior towards self-booking.

By December, self-booking services and hardware wallets have become the preferred choice for many. After the collapse of FTX, Trezor saw a 300% increase in sales and revenue Ledger saw Larger sale day ever.

White hat hackers

The crypto ecosystem is relatively new, and many use cases such as decentralized finance DeFi is in early development. This makes it vulnerable to errors and exploits. According to DefiLlama, DeFi protocols have been exploited for approximately $5.93 billion in 2022.

Total hacked value (in USD) of DeFi protocols in 2022. Source: DefiLlama

However, the numbers would have been much higher had it not been for the white hat hackers. These white hats have returned millions of dollars in stolen funds and reported security flaws that could lead to more exploits. Security service provider Immunefi claims to have prevented the theft of $20 billion worth of crypto assets through its bug bounty program for white hat hackers.

While many projects tend to ignore the white hats, 2022 has shown that it is better to pay millions in bug bounties than lose billions in exploits.

Rope

Amidst the chaos of 2022, Tether (USDTThe stablecoin has made its way through the crash wreckage of both Terra and FTX.

USDT price and volume on a one-year chart. Source: CoinMarketCap

The centralized stablecoin has been at the forefront of pundits’ commentary for as long as it has been around. When the original Terra stablecoin was unpegged, there were rumors about Tether being exposed to the collapsing ecosystem.

However, USDT has managed to overcome fear, and throughout 2022, it has done so in a big way Reduce his volatile exposure. The company too She vowed to stop lending money from her reserves A complete end to all fear, uncertainty, doubt or FUD.

Related: Christmas dinner table: What do you tell your family about what happened in cryptocurrency this year?

Tether has become more transparent over time, with 82% of its reserves in liquid assets. was for the company Total assets $68.06 billion At the end of the third quarter, exceeding total liabilities of $67.8 billion.

losers

The crypto ecosystem has seen many losers in 2022, and Sam Bankman-Fried was the first to get a mention. The former CEO of cryptocurrency exchange FTX kicked off 2022 with a net worth of $20 billion. In less than a year, that net worth was gone and Bankman Fried is now bankrupt bail for allegedly stealing clients’ money and committing securities fraud. Terra Do Kwon Co-Founder, whose last known location was Serbiaalso makes the list.

TerraUSD

Algorithmic stablecoins have been a promising new concept during the bull market. The Terra ecosystem has risen to new heights based on this hype. However, the flawed design of TerraUSD (UST), now known as TerraClassicUSD (USTC), aided by Kwon’s reckless decision-making led to its eventual downfall. The failure of the original Terra stablecoins also tarnished the concept of algorithmic stablecoins, with Regulators warn they.

FTX, Sam Bankman-Fried, Tether

The reservoir collapse wiped out $40 billion in investor capital and caused a contagion that has killed nearly a half dozen other crypto companies with exposure to Terra. While many companies and individuals could qualify on the losers list, the Terra reservoir explosion was the catalyst that would lead to more unrest in 2022.

Alameda Research, FTX, and Central Exchanges

At the start of 2022, FTX was valued at $32 billion, while its sister company, Alameda Research, boasted a multi-billion dollar valuation. However, the Bank run in November On FTX quickly turned into bankruptcy. As more details emerge, it turns out that FTX and Alameda Research were not as independent as they claimed. Even FTX US, which was supposed to be a separate entity regulated by US law, was found to be involved in the complex saga.

FTX, Sam Bankman-Fried, Tether

According to the authorities, FTX and Alameda transferred funds to each other, and the two companies also engaged in misappropriation of customer funds. Alameda has used FTX funds to lend billions of dollars to other companies. On the other hand, FTX used non-existent internal projects with inflated valuations as collateral for large loans. Ponzi completely collapsed in November.

Related: The five biggest cryptocurrency winners (and losers) of 2022

The downfall of FTX and Alameda further contagious the crypto ecosystem and single-handedly erased trust in centralized exchanges and the broader crypto system practically overnight.

Cryptocurrency investors

Among all the chaos and crash that has befallen many leading cryptocurrency exchanges and venture capital firms, the biggest losers are cryptocurrency investors. If the bear market combustion wasn’t enough, Millions of cryptocurrency investors Those whose money was on FTX lost their savings overnight.

Terra was once a $40 billion ecosystem. Its parent token LUNA – now known as Terra Classic (LUNC) – was one of the top five cryptocurrencies by market cap. With millions of customers invested in the ecosystem, the crash reduced their investment to zero in a matter of hours. After the collapse of Terra, cryptocurrency investors lost their money to a series of centralized exchanges and betting platforms such as Celsius, BlockFi, and Hodlnaut. Cryptocurrency investors have also lost significantly in the non-perishable token market, with many popular pools dropping 70% in price. In general, cryptocurrency investors are among the biggest losers of the year.

FTX, Sam Bankman-Fried, Tether

2022 will be listed in the encryption history as a file The dreadful approached. Cryptocurrency investors will want to forget about the year and start over. Venture capital firms and investors in crypto projects are re-evaluating their investment strategies. After such a turbulent year for cryptocurrencies, the likely outcome will be an acceleration of regulations in the industry throughout the next year. This may restore some lost confidence in the industry.