Opinion | Cryptocurrency’s torrid year: growing regulation is a bright spot amid FTX scandal and price collapse

Cryptocurrency markets have been through a lot this year – the ugly, the bad, but also the good. Prices have plummeted from the all-time highs of late 2021 and the FTX scandal closed out the last quarter of the year. But the other side of the coin is that cryptocurrency use is growing, such as in gaming, and regulatory momentum continues to build.

First, the ugly. There is nothing pretty about recent steep falls in cryptocurrency prices after the sustained rally that started in late 2019. Volatility has long been a feature of cryptocurrency markets but even bitcoin, the market proxy, is at levels not seen since 2020. Still, while this may have wiped out gains, it does not appear to have wiped out the optimism generated last year.

And then there is the collapse of the FTX cryptocurrency exchange. For its absence of corporate controls and lack of governance, FTX adds to a list of bad examples that stretch from Enron to WorldCom.

But a major force for good was the progress made in cryptocurrency regulation. Hong Kong, for instance, recently passed its landmark cryptocurrency law. With a growing list of governments mulling and passing regulation, adoption of digital assets continued at pace.