2022 – A Good Year for Bitcoin!

My very personal, opinionated and biased review of the year.

If you only look at the price chart, you might have the impression that 2022 was a bad year for Bitcoin. From around 50,000 USD it went down all the way to around 15,000 by December 2022. If you bought Bitcoin at its All-Time-High of 67,000 USD in November 2021, you might feel that you experienced a bloodbath.

But the same was true for people who invested at Bitcoin’s peaks of 30 USD in 2011 or 1000 USD in 2013. They had the impression that they bet on the wrong horse, as Bitcoin crashed heavily and took years to reach its latest peak again in both cases. Now these former top prices are super bargains. It is very likely that this pattern will repeat for the ones who bought Bitcoin in 2021. You just have to be patient and think long-term.

Bear markets are bad for people who only want to get rich quick, but good for the ones who want to build something substantial. It is understandable that many people jump on the Bitcoin bandwagon when the price skyrockets and the media report positively about it. However, the people who really matter are the ones who use Bitcoin to make the world a better place, regardless of its price (by the way, those are the ones that happen to get rich).

In a bear market, you can focus on building successful apps and companies without being bothered by people who only look for short term profits. You might find it harder to get funded by venture capitalists, but the ones who do will really believe in your project. You will also have less competition. Bear markets are good for buidlers, hodlers and other people who get their consonants mixed up.

Sam Bankman-Fried and Caroline Ellison of FTX / Alameda

Two events sent shockwaves through the Crypto universe this year: the collapse of Terra Luna and the collapse of FTX. Many people have lost money through these scams, and hopefully even more people have learned their lessons. Firstly: never invest in a “stablecoin” that is not collateralised by Bitcoin. Secondly, never leave your money on a centralised exchange (such as FTX, Binance or Kraken). Always remember the old Bitcoin mantra: Not your keys, not your coins!

The rise of Bitcoin-backed stablecoins like the Dollar-on-Chain and the fact that a lot of money has been pulled off exchanges show that people are finally learning, unfortunately the hard way. I see these events as bitterly needed purifications which will lead to a smarter behaviour of people and a more robust ecosystem.

In 2022, many things have happened that will make Bitcoin stronger in the long run. The Lightning Network is growing rapidly and will soon reach critical mass. The Lightning-based project Bitcoin Beach has produced spin-offs in Guatemala, Costa Rica, Brasil, South Africa, Vietnam and the Philippines (we will cover these Bitcoin Beach clones soon*). Following the example of El Salvador, more governments are opening up to Bitcoin, e.g. the ones of the Central African Republic or of the Portuguese island of Madeira.

Taro will enable stablecoin transactions on the Lightning Network. Rootstock, which enables smart contracts and DeFi based on Bitcoin, has re-branded and re-launched and is finally getting the attention it deserves. CoinJoin projects make Bitcoin transactions more private. Bitcoin conferences such as Labitconf in Buenos Aires or Bitcoin 22 in Miami set new attendance records. There are many good Bitcoin news if you follow the well informed media, not the mainstream press that wants you to believe that Bitcoin is dead.

Even some politicians seem to realise that Bitcoin is an opportunity rather than a threat. Republican congressman Tom Emmer said after the FTX desaster: “Take Sam Bankman-Fried’s con for what it is – a failure of centralisaton, business ethics and a crime, not a failure of technology. Crypto represents American Values the same way the Internet does. Decentralisation is the point.” (here is a video of his statement during the FTX hearing).

Congressman Tom Emmer (REP Minnesota)

Well put, Mr. Congressman! If these are American Values, I proudly self-identify as an American.

I am looking forward to an exciting 2023 which will still require some perseverance. The next bullrun will probably happen by the end of 2024, some months after the fourth Bitcoin halving, which is due for early 2024. Until then, use the time well to build and hold, or to use Bitcoin lingo, to buidl and hodl!

By Aaron Koenig

* If you happen to live in one of those places or you have visited them, feel free to report about your experience! Please join our Telegram group to suggest your article!