Despite an inequality year in the crypto markets, many market participants are unfazed by the long-term health of the industry and claim that legal frameworks in 2023 could restore confidence in the industry.
“Crypto will recover,” Katherine Dowling, general counsel member of Bitwise Asset Management, told TechCrunch. “It’s not the death of crypto.”
Given that many believe crypto is here to stay, it is worth looking into the future. Crypto locals certainly are – after the collapse of FTX, questions swirled about the future of crypto and what regulators would do next.
“There is no incentive for regulators to reduce their level of enforcement activity and recent events are likely to embolden them.” Mayer Brown’s Joe Castelluccio
But the disappointment with what FTX’s implosion represents is very hard to overstate, Yesha Yadav, professor of law and director of diversity, equity and community at Vanderbilt University, told TechCrunch. “The level of disillusionment, disappointment and feeling cheated by FTX is so profound because it was seen as one of the most compliance-minded institutions in the crypto-economy and the one that would lead regulatory efforts. “
Now, obviously, FTX is “the poster child for anything that could go wrong,” Yadav said. His fall forces regulators back to the drawing board. “They may have to do something different, bigger and tougher in response to what happened.”
But, what can we expect from regulators in 2023?
Regulators will finalize some of the proposals they presented, Alma Angotti, partner and global leader in legislative and regulatory risk at Guidehouse, told TechCrunch. “I think there’s a realization that the industry is too big to continue to ‘wait and see’.”