This time last year, like many others, I made a few predictions about what would happen in 2022 with Bitcoin and crypto. I believe in holding myself accountable, and there was a lot that I didn’t see coming like token and exchange collapses, but let’s see how many targets I hit:
1. MicroStrategy will continue to buy as much Bitcoin as they can
Prediction: The conviction about Bitcoin with MicroStrategy is strong, and their policy since the middle of 2020 has been to buy Bitcoin with their cash reserves, which I expect them to continue to do. At certain points, they have raised debt to buy more, and we could see a repeat of that in 2022 too. Even holidays don’t put them off, they announced another purchase worth $94M on New Years Eve.
Result: Bullseye. Microstrategy continued to add Bitcoin to their balance sheet throughout 2022, and are now holding 132,500 Bitcoin in total. They sold a little too, for tax purposes, but ended up buying more immediately after the sale to replace it. The conviction remains and will likely continue into 2023.
2. Meta starts a multiple crypto balance sheet strategy
Prediction: Facebook have gone Meta, and cryptos are the currencies of the metaverse. Therefore, if Meta are going to continue to launch features that facilitate payments with crypto, like they’re doing with WhatsApp, and build other metaverse products, then I think they’re going to have to hold those assets on their balance sheet.
Result: Off target. Meta abandoned the development of their own cryptocurrency Diem and the project lead, David Marcus, left to start his own company focussed on building products on top of Bitcoin and the Lightening Network instead. There are reports of Meta potentially launching crypto wallets in 2023, and we’ll just have to wait and see what they come up with. It’s taken them a year to add legs to Metaverse avatars though, so don’t hold your breath.
3. Another country will adopt Bitcoin as legal tender
Prediction: El Salvador was first but at least 1 other country will make Bitcoin legal tender this year. I’ll even go as far to say a G20 nation will adopt it. Maybe not through formal government recognition but perhaps forced by the needs of their own citizens. Just check out the recent inflation numbers in Turkey. The fixed supply and decentralised properties of Bitcoin are looking fairly good to them right now.
Result: Off target. I could claim this one, after the Central African Republic made Bitcoin legal tender, although I’m going to mark myself down because I called for a larger economic power to do so. I still believe these are the first dominoes and others will follow. Adoption is growing worldwide, especially where local currencies are failing, so perhaps it’s more of a bottom-up adoption process than a top-down one, which is understandable. Governments aren’t going to give up control of currencies easily.
4. Another country will try to ban Bitcoin and crypto
Prediction: By contrast, there will be another country that tries to ban Bitcoin and all crypto activities, like how China cracked down in 2021. As above, it could be a G20 nation and if I was to pick one it would be India, as they’ve not always been favourable towards it.
Result: Bullseye Thailand banned crypto as a means of payment but not for trading. 9 countries have outright bans in place, none of which are the big G20 nations, although there are restrictions in authoritarian countries like China and Russia.
5. Another nation will launch its own CBDC
Prediction: Sticking with the topic of how nations will act, China has already released its own Central Bank Digital Currency (CBDC) and another country will likely do the same. The European central bank has been talking about developing one, the UK is in consultation about it, but India again have been the most vocal. Most government issued currency is already digital, so you must ask what’s the point of a CBDC? Full surveillance and control over how you use it, that’s what, so then ask if that’s a world you want to live in?
Result: Off target. While other CBDCs haven’t been launched yet, governments around the world are laying the groundwork for them. 2023 looks set to be a pivotal year when it comes to their development and potential launch, which in my opinion, would be terrible for humanity and freedoms. Although some believe if they were introduced, the benefits of a system like Bitcoin become more obvious.
6. Cash App will integrate the Lightening Network
Prediction: Jack Dorsey left Twitter at the end of 2021 to focus his time as CEO of Square, now rebranded to Block. I expect Block’s product Cash App will be the first major payments app to integrate the properties of Lightening, which will make buying goods and services with Bitcoin as simple and fast as any currency we have today.
Result: Bullseye. This one went through in early Jan, then crypto exchange Kraken quickly joined them. The Lightening Network continues to grow, with more businesses being built on top of it. I expect to see this continue into 2023.
7. A phone company will integrate a crypto hardware wallet in their products
Prediction: Currently, you must use separate devices to store your crypto off the exchanges. However, with an integration direct into your phone, you can control the keys to your crypto on one device. Samsung has already announced an integration of NFTs into TVs in 2022, and phones could quickly follow.
Result: Miss. Way off on this one, but phone companies are secretive, and we’ll only know for sure when one is announced and available. However, well-known companies have submitted patents for hardware wallets and even though this is no guarantee of a product, it could happen anytime.
8. The most expensive NFT in the world will be sold
Prediction: The most expensive single NFT sold to date was a piece called Everydays by the artist Beeple, which sold for $69 Million. I’m not counting cryptopunk 9998 due to the buyer also potentially being the seller. I don’t think we’re at peak hype for NFTs yet, so one could sell for more than that at some stage in 2022.
Result: Miss. I thought we still had some hype to go, but I was wrong on this one and the NFT bust has happened in staggering style, as the market has been flooded with “rare” digital assets with little to no utility. I still believe there is something in the NFT idea, but JPEGs worth more than houses isn’t it.
9. Exchanges will consolidate
Prediction: By some counts, there are over 500 crypto exchanges, all in a fight for new users in a growing market. As the industry matures and growth from new registrations dries up, these companies will look to start acquiring each other or merging in order to grow. There could also be some pressure on exchanges to consolidate if a big sell off is seen in 2022, and they’re not able to return the crypto they say they hold for their customers, when it’s demanded.
Result: Off Target. The state of some of the crypto exchanges was so bad, even in some cases run as fraudulent enterprises, that the remaining exchanges weren’t willing to take on their liabilities to acquire users. Instead, it was better for them to see the competition burn. The clearest example being Binance and FTX, where it all played out on Twitter between the CEOs. Madness. The lesson is not to hold your assets on exchanges.
10. More FUD
Prediction: More legacy financial institutions and poorly informed political leaders, will criticise Bitcoin and crypto, spreading FUD (fear, uncertainty, and doubt) without fully understanding it and using poorly researched information. However, there is a growing army of political leaders, particularly in the US, that are very well informed and progressive when it comes to future regulation, so I do have some hope too. There will be some ridiculous soundbites though about crypto for criminals and it being bad for the environment.
Result: Bullseye. Not a hard one to get right this. The Fear, Uncertainty and Doubt just keeps coming. There is so much education that still needs to be done in this space, especially to regulators, with the main thing to know that Bitcoin and Crypto are not the same. The rubbish is getting cleaned out though and my hope for 2023 is that it all finally gets cleaned up and that what is left will be valuable to society.
Peace, love and Bitcoin,
Rob