What Were the 5 Biggest Crypto Stories of 2023?

2023 was a defining chapter, rich with narratives of regulatory scrutiny, market dynamics, and legal battles. As the crypto industry grappled with these challenges, the finance industry experienced a shift and mainstream finance acknowledged, if not warmly embraced, crypto. From hacks to arrests and billion-dollar token burns, here are the five biggest crypto stories of 2023.

1. FTX Saga: SBF Convicted in Fraud Case

One of the biggest crypto stories of 2023 was the downfall of FTX CEO Sam Bankman-Fried (SBF), once hailed as the wunderkind of the crypto industry and a potential trillionaire. However, as the year progressed, SBF found himself awaiting sentencing after being found guilty of fraud and conspiracy concerning the misuse of customer funds at his exchange. 

The repercussions of this case extended beyond the courtroom, with many FTX customers left grappling with the aftermath. Despite FTX’s commitment to returning 90% of recovered assets to customers, the reality is that not all assets will be reclaimed. Moreover, the missed opportunity to capitalise on the crypto rally this year added insult to injury for depositors.

This saga wasn’t just one of the biggest crypto stories of 2023 but also a reminder of the vulnerability of centralised exchanges. It emphasised the loss of benefits when users don’t control their private keys. The question lingers is whether the broader crypto community will heed this cautionary tale and prioritise self-custody.

Related: FTX Sues Sam Bankman-Fried and Associates for $1 Billion

2. BlackRock Makes a Move for a Bitcoin ETF

The resurgence of Bitcoin’s price in 2023 was linked to the renewed interest in a spot Bitcoin ETF, marking one of the biggest crypto stories of 2023. The potential approval of such an ETF gained substantial traction with the entry of BlackRock, one of the world’s largest asset managers. 

BlackRock files for spot bitcoin ETF, with Coinbase as a crypto custodian https://t.co/8GZbDGEkPG

— CNBC (@CNBC) June 15, 2023

BlackRock’s effort into the spot BTC ETF arena was a game-changer, not only due to its sheer influence but also because it added a layer of credibility to the crypto market. This development set off a chain reaction, prompting other industry heavyweights like Fidelity to renew their efforts for their spot ETF offerings.

The approval of a spot BTC ETF is currently in the hands of the Securities and Exchange Commission (SEC). This approval holds the promise of being a historic event for the crypto industry and is among the most anticipated events among the biggest crypto stories of 2023. Experts anticipate it could inject billions of dollars into the BTC market over the next few years. As the crypto community anxiously awaits the SEC’s decision, particularly on Ark Invest’s ARK 21Shares BTC ETF, the potential regulatory green light looms large over the industry.

Also Read: SEC Engages in Intense Discussions with Grayscale and BlackRock Regarding Bitcoin ETFs

3. SEC Charges Binance, Coinbase, and Kraken

Regulatory storm clouds gathered as the SEC filed lawsuits against major crypto exchanges, including Binance, Coinbase, and Kraken. Coinbase, known for its claims of regulatory openness, found itself in a particularly noteworthy position as the SEC asserted that some of the assets listed on the exchange qualified as securities. This legal entanglement raised fundamental questions about what constitutes security in the crypto space and who can make such determinations.

Brian Armstrong, CEO of Coinbase, hinted at relocating the exchange if regulatory clarity did not materialise in the coming years. Federal officials, such as Commodity Futures Trading Commission Chair Rostin Behnam, echoed this sentiment, emphasising the urgent need for a clearer regulatory framework. These events mark significant chapters in the biggest crypto stories of 2023 as the industry continues to define crypto assets as securities or commodities.

4. DOJ Charges Binance and Founder Changpeng Zhao (CZ)

In one of the biggest crypto stories of 2023, Binance, the largest crypto exchange globally, pleaded guilty to money laundering charges, agreeing to a hefty $4.3 billion in fines and settlements. This turning point signalled the potential end of crypto’s “Wild West” days. The charges against Binance, which included allegations of supporting illicit activities, prompted a broader conversation about enforcing stricter compliance with Anti-Money Laundering (AML) regulations.

Treasury Secretary Janet Yellen’s scathing remarks highlighted the seriousness of the charges. It stated that Binance allowed “Illicit actors to transact freely, supporting activities from child sexual abuse to illegal narcotics to terrorism, across more than 100,000 transactions.” This plea deal served as a wake-up call for investors, urging them to reconsider areas where AML regulations, particularly concerning stablecoins, might witness heightened enforcement. This development marked one of the most significant events in the biggest crypto stories of 2023.

Also Read: Is Binance’s Founder Changpeng Zhao Big Enough to Survive a $4.3B Fine and Ousting?

5. Ripple and Grayscale Triumphs Against the SEC

One of the biggest crypto stories of 2023 occurred in July when Ripple achieved a significant legal victory over the SEC. The U.S. court affirmed that XRP tokens were not securities, challenging the SEC’s overarching claim that all cryptocurrencies fall under the securities category. This triumph dealt a blow to the SEC’s enforcement-centric approach, exposing the vulnerabilities in its regulatory strategy. However, the SEC’s challenges did not end there.

When Grayscale’s BTC ETF application faced rejection, the company responded with a lawsuit against the SEC. In August, another U.S. court rebuffed the SEC’s decision, citing “Arbitrary and capricious” rejection criteria and vacating the ruling. This outcome triggered a flurry of BTC ETF applications in the latter half of the year, resulting in a shift in the power dynamics between regulators and the crypto industry.

A Defining Chapter for Digital Assets

Reflecting on the biggest crypto stories of 2023, it becomes evident that this year has marked a defining chapter for digital assets. The world of crypto has been shaped by rules, market changes, and legal wins. As people deal with the complexities of this ever-evolving ecosystem system, the importance of balancing new ideas, rules, and fair markets is clearer than ever. The year 2023 won’t be remembered for its problems but as a moment that decides where cryptocurrencies are headed.

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