2024 for Blockchain: Review

Crypto in the Year of 2024 - A Walk Through Fire


2024 was a year of transformative trials for the cryptocurrency world, (And I say that not so jokingly) 2024 most certainly was a year where the industry was truly forged in fire, mayhem, and accomplishments.

The lackluster dying landscape of Covid reflex shifted dramatically, with seismic events that sent shockwaves through the ecosystems of blockchain technology, stock markets and online banking systems. 

From the highly anticipated Bitcoin ETF approval to regulatory crackdowns, high-profile criminal prosecutions, and the transformation of industry titans, the year was nothing short of a rollercoaster ride. Yet, amidst the chaos, the underlying technology continued to mature, setting the stage for a potentially robust 2025.

Crypto 2024 in review

The Bitcoin ETF Boom

The year kicked off with a bang as the Securities and Exchange Commission (SEC) finally gave the green light to the first spot Bitcoin Exchange Traded Fund (ETF). This watershed moment, both long-awaited by the crypto community, and opposed by the same, opened the floodgates for institutional investors, injecting billions into the crypto market.

Pension funds, hedge funds, and asset management firms, previously hesitant, now had a regulated and familiar vehicle to gain exposure to Bitcoin. This influx of capital propelled Bitcoin's price to new all-time highs, crossing the $100,000 mark, as Wall Street embraced the digital gold narrative.

"The approval of a spot Bitcoin ETF is a landmark moment for the crypto industry," said Cathie Wood, CEO of Ark Invest, a prominent Bitcoin advocate. "It brings much-needed legitimacy and accessibility to the asset class, paving the way for wider adoption."

The ETF approval wasn't just about price; it was about perception. Bitcoin, once viewed as a fringe asset associated with illicit activities, was now being embraced by mainstream finance. This shift in perception had a ripple effect throughout the crypto ecosystem, boosting confidence and attracting new investors.

Regulatory Reckoning

However, the regulatory landscape remained turbulent. The SEC, under the leadership of Gary Gensler, intensified its scrutiny of the crypto industry. While the Bitcoin ETF was a major win, the SEC continued its pursuit of clarity and investor protection, often through enforcement actions. Many projects and exchanges found themselves navigating a complex web of regulations, facing fines and legal challenges.

The long-running legal battle between the SEC and Ripple Labs over the classification of XRP reached a head. After years of litigation, a federal judge ruled that XRP was not a security when sold on exchanges. This decision provided a glimmer of hope for the crypto industry, signaling a potential shift in the regulatory tide. It also ignited debates about the Howey Test, the legal framework used to determine whether an asset is a security, and its applicability to the decentralized nature of many cryptocurrencies.

"The court's decision on XRP is a significant victory for the crypto industry," commented Ripple CEO Brad Garlinghouse. "It provides much-needed clarity and sets a precedent for future regulatory actions."

The Ripple case became a rallying point for the crypto community, highlighting the need for clear and consistent regulations that foster innovation while protecting investors.

FTX Binance Debacle

FTX Fallout and the Fall of Sam Bankman-Fried

The collapse of FTX, one of the world's largest cryptocurrency exchanges, sent shockwaves through the industry. Its founder, Sam Bankman-Fried, once hailed as a visionary, faced multiple criminal charges, including fraud and money laundering. The FTX saga exposed the vulnerabilities of centralized exchanges and underscored the need for greater transparency and accountability in the crypto space.

While I debated on whether or not to even discuss this, the end result for FTX does stand as a reminder of where we've come from, a reminder perhaps to what depths and lengths the negative roots of the industry actually ran.

The fallout from FTX was widespread. Investors lost billions, trust in centralized platforms eroded, and the industry faced increased scrutiny from regulators and the media. The event triggered a wave of risk assessments and due diligence, with users demanding greater transparency and proof of reserves from exchanges.

While politicians on both sides of the fence of the FTX debacle pointed fingers and played sides, framing each party responsible and saying how ridiculous crypto is, to adopting it during an election cycle for votes, and cheering ETFs after swearing to dismantle blockchain. One could say FTX was an eye opening event, and the closure of the event during 2024 surely added a glaze to the donuts in our basket.

Court documents revealed that Bankman-Fried had used customer funds to cover losses at his trading firm, Alameda Research, and to fund a lavish lifestyle. Internal communications and financial records painted a picture of reckless risk-taking and blatant disregard for regulatory compliance.

In the end, Sam Bankman-Fried was found guilty on multiple counts and sentenced to a significant prison term, a landmark case that set a precedent for holding crypto executives accountable for their actions. The court's decision sent a clear message that fraudulent activities within the crypto space would not be tolerated. The FTX debacle served as a stark reminder of the importance of ethical leadership and responsible practices within the industry.

Binance Under Fire: CZ's Reign of Deceit

While Binance initially benefited from the downfall of FTX, the exchange and its CEO, Changpeng Zhao (CZ), soon found themselves embroiled in their own legal troubles. Binance was accused of operating an unregistered securities exchange, facilitating money laundering, and deliberately evading regulations. CZ himself faced scrutiny for his alleged role in these activities, with accusations of orchestrating a complex web of shell companies to obfuscate Binance's true ownership and operations.

Investigations revealed a pattern of deliberate non-compliance, with Binance allegedly ignoring KYC/AML regulations and facilitating transactions for sanctioned entities. Leaked internal communications and whistleblower testimonies painted a picture of a company prioritizing profit over regulatory compliance.

In 2024, Binance and CZ reached a settlement with the SEC, agreeing to pay a substantial fine and implement stricter compliance measures. CZ also stepped down as CEO of Binance, a move widely seen as an attempt to distance himself from the company's legal woes. However, critics argued that the settlement was a mere slap on the wrist and that CZ should face further legal repercussions for his alleged misconduct.

"CZ's actions demonstrate a blatant disregard for the law and a willingness to exploit regulatory loopholes for personal gain," stated a legal analyst following the settlement. "His resignation as CEO is a hollow gesture that does little to address the systemic issues within Binance."

The Rise of Alternative Chains

While Bitcoin and Ethereum continued to dominate the market, alternative chains like Solana, Avalanche, and Polygon gained significant traction. These Layer-1 blockchains offered faster transaction speeds and lower fees, attracting developers and users alike. The rise of decentralized finance (DeFi) and non-fungible tokens (NFTs) further fueled the growth of these alternative ecosystems.

Solana, with its high throughput and low latency, emerged as a hub for NFT projects and DeFi applications. Avalanche, known for its sub-second finality and interoperability features, attracted a growing ecosystem of decentralized applications. Polygon, a Layer-2 scaling solution for Ethereum, continued to onboard millions of users, offering a more affordable and efficient platform for DeFi and NFTs. While FTM, XRP, SUI, SEI, and BASE ecosystems continue to thrive and grow regularly, Ethereum became stagnant. Chain analysts seeing even Binance chain inflows dying dramatically are watching Solana become the new breeding ground for new token launches, versus Ethereum.

The growth of these alternative chains showcased the diversity and innovation within the blockchain space. It also highlighted the increasing demand for scalable and interoperable solutions to support the growing number of users and applications. While Ethereum struggled, many chains doubled in value.

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Looking Ahead to 2025: A Year of Resilience and Growth

Despite the challenges and setbacks, the crypto industry demonstrated remarkable resilience in 2024. The underlying technology continued to evolve, with innovations in scalability, security, and interoperability. The emergence of new use cases, such as decentralized identity and supply chain management, further expanded the potential of blockchain technology.

As we enter 2025, the crypto landscape is poised for continued growth and maturation. The regulatory environment remains a key factor, but the industry is actively engaging with policymakers to shape a more favorable framework. The adoption of cryptocurrencies by institutional investors and mainstream companies is expected to accelerate, driving further innovation and investment.

The scars of 2024, though deep, have served to strengthen the crypto ecosystem. The lessons learned from regulatory challenges, exchange collapses, and market volatility have paved the way for a more resilient and responsible industry.

We can anticipate 2025 to be a year of rebuilding and renewed confidence. With a clearer regulatory landscape, increased institutional adoption, and continued technological advancements, the crypto industry is well-positioned for a period of sustained growth and innovation. The year 2024 may have been a walk through fire, but it has forged a stronger and more resilient crypto ecosystem, ready to embrace the opportunities that lie ahead.

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