Although David Marcus is the head of a company specializing in Bitcoin, he doesn’t think the Crypto Winter will be over anytime soon.
Marcus was previously the CEO of PayPal and the head of the cryptocurrency business at Facebook (now Meta). The Los Angeles-based startup Lightspark he currently manages leverages his capabilities in Bitcoin to create payment infrastructure.
A blog published by Marcus on December 30, 2022 on Medium, predicting the performance of the cryptocurrency industry in 2023. Cryptocurrency investors hoping for a turnaround in 2023 may be disappointed by his forecast.
The Cryptocurrency Industry Exposes Its ‘Ugly Side’
First, Marcus looked back to 2022, mentioning the bankruptcy of FTX. FTX, a $32 billion cryptocurrency trading platform, once billed itself as an industry leader and hired athletes such as Tom Brady and other celebrities to its platform. FTX’s bankruptcy in November 2022 has shaken confidence in the cryptocurrency industry, making calls for greater regulation of the industry increasingly fierce.
The founder of FTX, Sam Bankman-Fried, was charged by the US government with eight criminal charges, including wire fraud, money laundering, and conspiracy to commit fraud. He is expected to face a lengthy prison sentence.
Marcus wrote: “The past year has been more challenging for the cryptocurrency industry. We have seen the ugly side exposed by greedy Wall Street in earlier years repeated. Bankruptcies, and most egregiously that of FTX, have added an unnecessary dose of drama to the year.”
The bankruptcy of FTX has added to the already bleak cryptocurrency winter. Since the beginning of 2022, the prices of the two leading cryptocurrencies, Bitcoin and Ethereum, have fallen by more than 60%, and the shares of the cryptocurrency trading platform Coinbase have fallen by about 85%.
Crypto recovery will take years
But Marcus sees little relief in the future.
He wrote: “The ‘crypto winter’ won’t end until 2023 or even 2024. It will take two years for the market to recover from wanton abuse by the black sheep, and responsible regulation by governments.”
Coinbase CEO Brian Armstrong also mentioned the black sheep of the industry earlier in December 2022. “The industry as a whole has to come to terms with the fact that I think our industry attracts a lot of scammers,” he told attendees at the Crypto Founders Summit.
With regard to cryptocurrency regulation, Senator Sherrod Brown, chairman of the U.S. Senate Banking Committee, said a few weeks ago: “Cryptocurrencies cannot be exempted from regulation just because they look glamorous … anything that is similar in form and behavior to securities, commodities, or banking products. Any product should be regulated and supervised by responsible government departments that serve consumers.”
Marcus noted that consumer trust “will take many years to rebuild, but I believe that in the long run, this will prove to be an industry reset that will benefit legitimate industry players.”
He also said: “In the cryptocurrency industry, years of greed will subside and real-world applications will become mainstream. Gone are the days when you can create a token out of thin air and make millions of dollars. Music It has stopped. We will get back to normal, we must create real value and solve real problems.” (Fortune Chinese Network)
Translator: Liu Jinlong
Reviewer: Wang Hao
David Marcus may lead a Bitcoin-focused company, but he doesn’t see the Crypto Winter ending anytime soon.
Marcus was CEO of PayPal and also ran crypto efforts at Facebook (now Meta). He currently leads Lightspark, a Los Angeles startup creating payment infrastructure by building upon Bitcoin’s capabilities.
In a blog post published on December 30 on Medium, Marcus predicted among other things how the crypto sector will fare in 2023. Crypto speculators hoping for a turnaround next year will be disappointed by his outlook.
Crypto “ugliness” on display
First, Marcus looked back on 2022, noting the FTX bankruptcy. The $32 billion cryptocurrency exchange had established itself as a leader in the field, having enlisted star athletes like Tom Brady and other celebrities to bolster its image. Its monthly collapse in last The crypto sector and spurred calls for tighter regulation.
FTX founder Sam Bankman-Fried has been charged by US authorities with eight criminal violations—ranging from wire fraud to money laundering to conspiracy to commit fraud—and is expected to serve a lengthy prison sentence.
“For crypto, it was an even more challenging year,” wrote Marcus. “We saw all the ugliness of the earlier years of Wall Street’s greed repeat itself with the rapid house-of-cards style collapse of many firms, the most egregious and shocking one being FTX capping the year with an additional and very unnecessary dose of drama.”
The FTX collapse added to an already miserable Crypto Winter. Year-to-date, Bitcoin and Ethereum, the two leading cryptocurrencies, are down over 60 percent, and shares of crypto exchange Coinbase have fallen by about 85 percent.
Crypto recovery will take years
But Marcus sees little relief ahead.
“We won’t exit this ‘crypto winter’ in 2023, and probably not in 2024 either,” he wrote. “It’ll take a couple of years for the market to recover from the abuse of unscrupulous players, and for responsible regulation to come through.”
Coinbase CEO Brian Armstrong also noted the industry’s bad actors earlier December 2022, telling attendees at a crypto founder’s summit: “We have to kind of come to terms as an industry with the fact that, I think our industry is attracting a disproportionate share of f and scammers.”
As for crypto regulations, Senator Sherrod Brown, chair of the Senate banking committee, said a few weeks ago that “crypto doesn’t get a free pass because it’s bright and shiny…Things that look and behave like securities, commodities, or banking products need to be regulated and supervised by the responsible agencies who serve consumers.”
Marcus noted that consumer trust will “take a few years to rebuild, but ultimately I believe this will prove to be a beneficial reset for legitimate industry players over the long run.”
He added, “In crypto, years of greed will make room for real-world applications. The years of creating a token out of thin air and making millions are over. The music has stopped. We’re back to our regular programming of having to create real value and solving real world problems.”
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