In 2023, Bitcoin and Ethereum exhibited contrasting market performances. Bitcoin had a strong year, starting at $16K and reaching $44K. Ethereum, however, had a choppy and somewhat lackluster up chart, influenced by factors such as its outperformance in 2022 and the preference for low market cap stacks. Layer two solutions saw significant growth, with a three billion dollar deposit and a seven-fold increase in usage. Phishing scams emerged as a major issue, with over $1 billion stolen. Solana's DEX volume surpassed Ethereum's, due to its low fees and high volume. Arbitrum, a layer two solution, also contributed to the fractured Ethereum narrative. Inscriptions, arbitrary data written to a single Satoshi blockchain, have caused debates about spam and been used for NFTs. Coinbase has clashed with the SEC over crypto securities regulation and launched a Super PAC to support crypto-friendly candidates. Elizabeth Warren criticized the crypto industry, notably Coinbase, alleging its connection to terrorism and influence on policy decisions. Eigenlayer, liquid restaking tokens, zkSync, and the hyperchain are new developments improving the Ethereum ecosystem. Celestia emerges as a potential cost-effective option for non-Ethereum DA layers. Solana phones saw an airdrop-driven surge in demand after initially struggling to gain traction. Crypto's legal landscape evolved, with the first conviction of a DeFi hacker showcasing the growing legal implications in the crypto space.
Takeaways
• Bitcoin had a strong year in 2023, while Ethereum faced challenges despite impressive growth in layer two solutions.
• Phishing attacks became a major concern in the crypto space, posing a significant threat to individual investors.
• Solana's DEX volume surpassing Ethereum's highlights the fractured Ethereum ecosystem and the rise of alternative layer twos.
• Inscriptions have caused debates about spam and resource use on several chains, triggering stress tests and contrasting perspectives on their legitimacy.
• Coinbase's legal battles with the SEC over crypto securities regulation and the expansion of crypto-friendly political influence underline ongoing regulatory hurdles.
• Elizabeth Warren's criticism of the crypto industry, particularly Coinbase, highlighted tensions between traditional finance and decentralized systems.
• Recent developments in the Ethereum ecosystem aim to enhance scalability and user experience.
• Celestia presents cost-saving opportunities for layer twos, while Solana's phone faced challenges before a surge in demand due to an airdrop.
• The legal complexities surrounding cryptocurrencies continue to evolve, with cases such as Three Arrows Capital and the first DeFi hacker conviction showcasing the growing legal considerations in the crypto space.
