XGo’s 2022 Crypto Roundup: Four better or four worse
The beginning of 2022 saw both the crypto market cap and the non-fungible token (NFT) market reaching incredibly healthy status. Crypto reached a strong $2.5 trillion in value, and NFTs peaked after 2021’s exponential growth.
As in previous crypto bull markets, new projects gained significant attention, which drove aggressive speculative investment; the Terra ecosystem being a prime example. Moreover, both retail and venture capitalists were heavily investing in what was fast becoming an overcrowded space. All this activity was taking place against a backdrop of a wider macroeconomic environment that felt unendingly strong, and with easy access to borrowing at low rates, the resulting frenzy into the high yield offerings seemed sensible as a source of wealth generation.
In September, we witnessed the primary technological event of the year: The Ethereum Merge. The Ethereum blockchain successfully moved from its proof of work consensus layer to a proof of stake mechanism. With miners now unnecessary to validate the chain, its energy use has been slashed, and it now operates as a far greener chain.
Following The Merge, interest in Layer 1 (Cardano, Solana, Avalanche) chains also seemed to shift to Layer 2 (Arbiturm, Optimism) scaling solutions. Simultaneously, there has been a general race to the bottom for on-chain transaction fees, CEX trading fees, and, more recently, royalty fees for NFT trading platforms too.
A lot of global conflict throughout the year gave ample opportunity to showcase the strength of crypto's low-friction cross-border transfer of value. As the war began in Ukraine, the crypto community rallied to fund their support, with millions of dollars being raised and sent to support troops and their families.
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