TL;DR
As 2022 draws to a close, we say goodbye to what will be remembered as a particularly challenging period for many participants in the crypto and blockchain sector. Crypto winter has arrived, but the change of seasons in trading markets has not slowed down the adoption and development of blockchain technology. There is no doubt that the industry has advanced since 2021, even if some prefer to focus on short-term dramas.
After a historic high, the cryptocurrency market entered 2022 struggling to maintain its level until the Terra blockchain crisis in May, which sent cryptocurrency prices crashing. The confidence level remained shaky as fallout from the crisis hit hedge fund Three Arrows Capital and cryptocurrency lending firm Celsius Network.
Then in November, Coindesk reported a liquidity crisis at FTX, triggering a liquidation that culminated in the company's bankruptcy amid reports of mismanagement of financial controls, suspicious loans and personal use of customer deposits by FTX executives . This time, the effect of the crisis brought down cryptocurrency credit companies BlockFi and Genesis Global Capital.
Context
In a period of 12 months, there was in fact a retreat from historical highs. That said, Chainalysis, however, noted in its 2022 Crypto Adoption Index blog post that it is āimportant to note that global adoption remains well above pre-2019 bull market levels.ā
The DeFi sector's TVL fell from nearly $190 billion to $39 billion, with the Terra collapse representing a drop of around $75 billion in a single event. However, much of this loss in value can be attributed to falling cryptocurrency prices, so perhaps DeFi will still return to the top when the market recovers.
NFT trading activity also slowed and volumes dropped to 2021 levels. The highs of April and May 2022 set a high standard and journalists were quick to highlight the stark contrast between those euphoric weeks and the "quiet" trading period at the end of the year. However, when it comes to NFTs, there are still important use cases and applications that have not been fully explored. If this materializes, the adoption of NFTs could continue to grow.
Strengths
Even during difficult times of the year, we had some positives. Ethereum has finally changed its validation mechanism from Proof of Work to Proof of Stake with the update known as āThe Mergeā. The transition went smoothly, ushering in a new era of greener transactions and bringing hope of lower network fees.
Although NFT trading activities have fluctuated, it appears that the adoption of NFTs continues to advance, especially in the social sphere. Twitter allowed users to upload NFTs to use as their profile picture. Facebook and Instagram have allowed users to post and share NFTs. Millions of Reddit users have signed up to use NFT wallets and created NFT avatars, while the social platform's NFT collections have become among the most popular collections to date.
At the regulatory level, the European Union approved the draft law regulating crypto assets (Markets in Crypto Assets Regulation), providing clarity for the regulation of cryptocurrencies in the EU. The law will only come into effect in 2024, however, it already provides guidance for centralized brokers regarding custody requirements, asset trading and risk assessment and communication to users. Regulation aimed at protecting investors' interests will result in a general benefit for the sector.
India has started trials in 4 cities for its retail-focused central bank digital currency (CBDC). The pilot program will expand to 9 more cities in the future. This will potentially improve the lives of more than 1 billion people, many of whom don't even have a bank account. This action brings the total number of countries that have launched a CBDC to 11. More than 100 countries are in the launch or development stage of their own CBDC.
The most important thing is that we still have teams forming, even with all the noise in the market. More layer-1 protocols have been released to create improved Web3 infrastructures. Promising new technologies, such as zero-knowledge proofs (zk), are progressing. This year, BNB Chain launched its zero-knowledge proofs scaling technology testnet, zkBNB, and several other zk-EVM projects are planned for launch next year. This will significantly improve scalability and interoperability between blockchains. Major technological advances often emerge during recessions. The expectation is that blockchain technology will continue to advance regardless of market sentiment.
Protect yourself with Binance Academy this crypto winter
What better time than winter to brush up on your blockchain knowledge? In November, we launched the first of our free crypto education courses, and to date, 200,000 people have invested in their personal growth and blockchain knowledge by completing a combined 8.3 years of blockchain course content (averaging 22 minutes per user).
In January, we will have over 120 minutes of self-directed learning videos for everyone to learn the basics of blockchain, Web3, and trading. Additionally, anyone with a Binance account can redeem a free NFT certificate by completing the entire 6-course series for beginners.
In 2022, we received 26 million unique visitor hits on our website and our videos on YouTube and Binance Live reached 25 million views. We've also expanded our knowledge base to nearly 1,000 articles and glossary entries. We distributed $7.3 million in rewards to over 6.5 million visitors through our Learn and Earn campaigns, where users learned more about how different blockchain projects work.
Binance Academy has built partnerships around the world and brought crypto and Web3 education to more than 75 universities in more than 20 countries around the world. More than 5,500 students and guests attended these educational events, and we received nearly a thousand requests, from more than 35 countries (and counting!), from people who are interested in becoming student ambassadors.
Our ambassador selection program, Student Ambassador, launched in Q4 2022 and represents investment in the next generation of blockchain industry leaders. Selected students will contribute and help organize crypto literacy and education activitiesĀ on their campuses. They will promote interactions and knowledge-sharing opportunities between blockchain communities and have access to Binance Academy networks - and perhaps even have internship opportunities!
We have also increased cross-nation cooperation, with countries like Kazakhstan, where we will provide materials and support for developing and running core educational programs on blockchain and compliance for universities across the country.
What's in store for 2023?
In the coming year, we look forward to bringing blockchain knowledge to more people. Our partnerships will continue to expand as we reach more schools, governments and institutions to offer in-person training, hackathons and workshops.
We have ongoing partnership proposals with some of the world's leading education providers to make certified education available to those wishing to pursue careers in the blockchain industry.
For those who just want to continue exploring this fascinating new technology, we will also be extending our free online course offering in 2023, with the aim of offering over 20 hours of educational videos, at intermediate and advanced levels, through our platform of Courses. We want to ensure that everyone has access to free education that will allow them to benefit from a decentralized future powered by blockchain technology.
Hereās to 2023 ā hang in there!
Conclusion
Looking ahead to 2022, it is clear that the blockchain ecosystem has experienced significant growth and development. Despite facing its setbacks, the crypto community has persisted and will eventually emerge stronger and more experienced. It can also be said that every market cycle eliminates participants who have unsustainable business models. Perhaps it is no different for the crypto industry.
So, while it is true that the crypto market has been more volatile lately, the continued proliferation of new crypto protocols and the growing adoption of existing protocols perhaps are reasons to remain optimistic about the sector's prospects. Either way, it's always interesting to engage in continuous, lifelong learning about the world and technologies around us (regardless of market conditions!). So keep learning about the rapidly evolving blockchain industry! We look forward to the coming years and can't wait to see what the next chapter has in store for this industry.
