Crypto Newsletter Jan '23
2023 Crypto Outlook, Bitcoin price action, Updates for Crypto Investing Club & Dubai
This newsletter covers current headlines within the crypto space, my opinion on them and projects & people I find interesting. Also included is information about important crypto community events both locally & globally.
Howdy crypto-heads, I hope your 2023 has been off to a great start! It’s a new year full of new possibilities and I’m finally allowing myself to hope the cleansing bear market fires have flushed the majority of bad actors off the crypto scene. Today’s post will cover the following 3 things:
Crypto Outlook for 2023
Bitcoin’s recent price pump
Denver Crypto Club investor’s & misc. updates
1. Look Out for Crypto in 2023
This image pretty much sums up crypto in 2022 - Millions of people hurt by greedy, overconfident, super high risk-taking projects and leaders (some of whom committed outright fraud). 2022 was a definite black eye on the entire crypto-sphere that is still causing fallout while regulators lick their chops and the global economy looks ready to tank. Ooof.
So is there any good news? Well, as consultants for Web3 startups, my business partner and I noticed an interesting theme in 2022 that continues to trend upwards and has me somehow still excited about this industry for 2023 and beyond.
Before we get to that however we should talk about what needs to happen first (in my opinion) so that we can put this bear market winter behind us. Namely - regulators will need to regulate.
Regulating Web3 is the ultimate Boomer nightmare
As someone who views privacy as a human right and most governments as dysfunctional (America’s for sure) it probably seems odd that I’m talking about regulation in a positive way.
My reasoning for this stance is all about mass adoption though, so allow me to explain a bit. Crypto has had an epic run up until this point, with more than a decade of proof that blockchain based cryptocurrency systems are viable and trustworthy. This new digital frontier has opened up life-changing opportunities for many people who otherwise may not have had them.
Along with the good stuff like wealth creation, preservation and data sovereignty we’ve also seen the bad stuff like scams, fraud and outright psychopathic behavior. Because of the balancing act that forms public opinion and the fact that lately the scales for crypto have been tipping to the “Bad” side, us crypto natives need to clean up our act a bit to get the mainstream folks back on our side.
Up until now the aging legislators and federal regulators have taken the approach to crypto regulation by waiting until something bad happens and swooping in with a bullhorn shouting, “I TOLD YOU SO” and carting off the most egregious offenders.
In my opinion this type of regulation needs to stop because not only does it fail to protect the people all the regulators & legislators are claiming to care about, but it stifles innovation by not allowing quality projects to build amazing things confidently.
Instead, these teams are paying insane attorney and advisor fee’s (tbf helping Willenrimer stay in business) just to take a small amount of risk off the table.
What we need in 2023 is regulation by guidance and preferably some open dialogue between established industry players/coalitions and the regulators/legislators in government.
This would allow the space to get cleaned up efficiently and protect the smaller fish while still allowing new projects or already established companies to explore the benefits of Web3 without risking the SEC or other regulatory hammer coming down.
Unfortunately many of the people in the positions of power that could effect this change are older and have to work harder to understand the nuance of the Web3/Blockchain/Cryptocurrency industry. The good news is they have lots of younger, smarter people on their staff and if they listen some real, beneficial change is possible.
Until the crypto industry is made safer I don’t see a clear path to “mass adoption” which is one of the main reasons I joined this space to begin with. Once we’ve got a good set of rules to play by I expect the next leg up for crypto to happen shortly thereafter.
A Positive Trend for Web3 business
So what about that trend the ChatGPT AI told me to tease y’all with earlier? Well, the short story is that throughout 2022 there was quite a lot happening behind the scenes when it came to established companies dipping their toes into Web3.
Especially noteworthy were the Web3 compliance and legal companies that saw strong interest in their services from medium to large businesses…you know, the ones that make up most of the economic activity on Earth. I see this trend as similar to building websites after the internet began taking hold - many forward looking companies created tech jobs that didn’t exist before and funded departments that incorporated this tech in order to benefit from all the innovation our early web had to offer.
The new type of technology worked needed to know how to code and how to make use of internet protocols and in the early days there was a huge shortage of qualified, experience people.
I see the exact thing happening today with the continued scarcity of quality, experienced smart contract and blockchain tech related developers. While I hope to alleviate this problem somewhat (Our Web3 coding bootcamp is in the works) the demand for these type of coders is still greatly outpacing supply as more and more Web3 builders continue to ship product.
With strong interest in the compliance and legal arenas coupled with growing demand for the people actually building Web3, 2023 seems poised to be a banner year when it comes to business adoption.
I would caution to take this outlook with a grain of salt though…many of these companies are preparing to enter only if the market conditions are right. I interpret this to mean that regulators need to make it safe for them and without that happening 2023 could easily be another “Year of the bears” for all of us - but I’m hopeful that it won’t!
2. Bitcoin on the rise, but will it last?
Lately the price of our favorite ‘corn has shot up to above $23,000 USD per Bitcoin from an extended sideways low near $16k. While some are already declaring the crypto winter to be over, I’m not so sure, and looking at the Bitcoin chart from the spring/summer of 2019 I wonder if history won’t repeat itself or at least rhyme a bit.
This chart above, which shows April 2019 to March 2020 came right after more than a year of bear action that started in early 2018. The price made an epic run-up during the spring but fizzled out and slowly descended for almost 3 quarters before heavily crashing back to where it started.
While I must admit that the Covid induced stock market crash likely played a role in the March 2020 price action for Bitcoin, it also seems plausible to me that before the next bull market can begin we need to have our final market capitulation. Observing how quick people have been to say the bull run is “on” right now makes me think that there are still some hopes to crush and leveraged longs to feed off for the more sophisticated and well funded market makers.
Regardless of if I’m right or not, if we keep heading up $45-48k will be a very significant overhead resistance. And if we crash again I expect $19-20k to be a possible landing zone. Good luck out there!
3. Updates for Denver Crypto Club & others
If you haven’t signed up for EthDenver yet I highly encourage you to check it out! This year should be totally different, with larger venues that I’m hopeful will get rid of the 3 hour lines from ‘22 (even though I met some awesome people while waiting in the cold).
Dubai market expanding
If you’ve been observing crypto twitter lately you may have seen some interesting headlines coming from middle eastern countries like the UAE and Saudi Arabia. Both of these countries have some very senior governmental officials touting the benefits of smart cities and leveraging blockchain technology to build the future of urban infrastructure and finance.
Coupled with the amount of capital that these locations possess, the support of the authorities means significant investment has already started flowing into these areas.
While some of the initiatives are a little dystopian, like NEOM’s The Line, there still seems to be a genuine interest from the MENA area to incorporate Web3 into their
dreams for the future. Personally I am more drawn to Dubai than the other areas I’ve noticed emerging onto the scene, but this probably has something to do with picking up some new clients from here and the easier access foreigners have to this diverse, international city. As a lone bright spot in this crypto bear market I was inspired enough to create a new podcast with my business partner Csill called the Dubai Blockchain Village.
Our purpose with this production is to, “inform founders, investors and government who are building the best Web3 projects in the international hub of smart Dubai…” and I sincerely hope you check it out if it’s something you’re interested in.
Denver Crypto Investor’s Club
Our final year of the club is here! With the Denver Crypto Club ending before December 2023 I’m ready to see what new projects and exciting insights we can come up with to continue beating our benchmark, Bitcoin.
For those of you who are already members or who’d like to check it out here are the details for January’s meeting:
VIRTUAL ONLY - January 26th, Thursday, 7pm-8:30pm Mountain Time
Join using this zoom link: https://us02web.zoom.us/j/82954333022?pwd=hyx2iD1JRSPqtRmBK5mfNOtWEbY0Yg.1
That’s it for this edition, stay happy and healthy and I’ll catch you soon!
Much Love,
~Matt