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This Was the Year 2023 in Crypto – Part One: The First Half
In the first part of this two-part series, we’ll have a look at what mattered in crypto from January to June in 2023, including Bitcoin performance, regulatory developments and impact and other crypto developments.
January 2023
Bitcoin started the year around USD $16,500 (AUD $24,142) and quickly rose above USD $22,800 (AUD $33,361) by the end of the month, representing a significant recovery from the lows following the FTX collapse in late 2022. The month marked the second-best performance of Bitcoin in the past ten years, with almost 40% in returns, compared to an average of 3.6% for January.
The headlines were dominated by regulatory news and the industry was reeling from the FTX fallout and several bankruptcies.
February 2023
Price-wise, Bitcoin saw a stable month, opening at USD $23,130 (AUD $33,842) and closing at USD $23,521 (AUD $34,414).
Headlines were once again dominated by regulatory events with the Australian Government releasing its consultation paper called “Token Mapping.”
Token mapping is the process of identifying the key activities and functions of products in the crypto ecosystem and mapping them against existing regulatory frameworks.
Australian Government the Treasury
Additionally, the Australian Securities and Investment Commission (ASIC) started investigating Binance Australia after it admitted to have misclassified some retail investors as wholesale clients.
March 2023
March emerged as the third-best month for Bitcoin this year, with gains of almost 23%, closing at USD $28,032 (AUD $41,029).
The month also saw the United States Securities and Exchange Commission (SEC) charge trading platform Beaxy for operating an “unregistered exchange, broker and clearing agency.” A theme which would continue throughout the rest of 2023.
Meanwhile, reports came to light that Australians lost hundreds of millions in do-it-yourself (DIY) superannuation funds, and Nvidia claimed that crypto doesn’t “bring anything useful for society.”
All this crypto stuff […] they bought a lot of stuff, and then eventually it collapsed, because it doesn’t bring anything useful for society. I never believed that [crypto] is something that will do something good for humanity.
Michael Kagan, Chief Technology Officer Nvidia April 2023
April, like February, was a rather stable month for the number one crypto, with the price of BTC going up 2.81% from USD $28,473 (AUD $41,646) to USD $29,245 (AUD $42,776) by the end of April.
The news in April ranged from calls for a ban on crypto, accusations that crime is “not a bug, but a feature” of crypto, to statements such as that of Investor Chamath Palihapitiya who said “Crypto Is Dead In America.” In Australia, regulator ASIC cancelled the derivative licence of Binance after months of investigations.
Despite the encouraging performance of Bitcoin thus far, BTC is still down 60% from its all-time high in late 2021.
In other news venture funding for crypto-related startups plunged by 80%, hitting the lowest level in two years.
May 2023
In May, Bitcoin experienced its largest correction in the first half of 2023, starting at USD $29,227 (AUD $42,724) and ending with an almost 7% loss at USD $27,700 (AUD $40,491).
The month was also a disappointing one for Australians, with payment service Cuscal disabling its customers from depositing money on Binance. May saw the first global attempt at regulation with international securities watchdog IOSCO releasing its policy recommendations. Reuters reported the standards would aim to cover “dealing with conflicts of interest, market manipulation, cross-border regulatory cooperation, custody of crypto-assets, operational risks, and treatment of retail customers.” Meanwhile the European Union adopted anti-money laundering rules which would make crypto transfers traceable.
Today’s decision is bad news for those who have misused crypto-assets for their illegal activities, to circumvent EU sanctions or to finance terrorism and war. Doing so will no longer be possible in Europe without exposure – it is an important step forward in the fight against money laundering.
Elisabeth Svantesson, Minister for Finance of Sweden June 2023
In June Solana (SOL) dropped to new lows, falling below USD $15 (AUD $22) on June 15 – little did investors know what a great “buy the dip moment” this would be in hindsight. Bitcoin however, had another stellar month, rallying 11%, its best result in the first half of 2023. BTC started June at USD $27,218 (AUD $39,771) and ended it at USD $30,441 (AUD $44,481).
For Australians, things turned sour as the largest bank, Commonwealth Bank, started blocking customer transfers to “certain” exchanges. Only days earlier the US SEC brought charges against Coinbase and Binance in the United States.
June also saw some of the lowest volumes on centralised exchanges hitting new all-time lows amid the gloomy regulatory environment. As Ripple began to see progress in its lawsuit with the SEC, Binance was also preparing to counter the regulator’s charges in late June.
Crypto lawyer MetaLawMan highlighted the significance of the lawsuit for the sector in a post viewed over 750,000 times.
Read part two on Tuesday, January 2, 2024.
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
