Could the Crypto Markets Revive in 2023? Two Researchers Discuss

Lucas Nuzzi, head of R&D at CoinMetrics, and Larry Cermak, VP of research at The Block, discuss the current state of the crypto market, including the potential for contagion effects and the challenges faced by VC companies. They also delve into the mining industry and the issues surrounding MEV and Ethereum. The conversation also touches on stablecoins, DeFi activity and NFT trading, and the potential dangers of Binance’s dominance in the industry.

Show highlights:

• how the collapse in 2022 of FTX and other behemoths will affect the industry in 2023
• why there’s been a lot of forced selling in the markets recently
• why the industry could still be headed to more contagion effects
• the characteristics of the current bear market, how it differs from previous ones, and the role of the macroeconomic environment
• why it’s very hard to predict how prices will behave in 2023
• why VC firms will have to focus on long-term projects rather than speculation
• what’s going to happen in the Bitcoin mining industry in 2023 considering the current tough situation
• why Lucas thinks that Bitcoin “drastically overpays for security”
• why MEV is a concerning issue and how it represents a single point of failure for Ethereum
• how the narrative of alternative layer 1s has changed and why the focus will shift to layer 2s
• whether there is a need to develop better blockchain monitoring tools
• why stablecoin issuers have a very good business model given the interest rate environment
• what are the problems of stablecoins and how they will be regulated
• why DeFi activity and NFT trading were down so heavily in 2022 and whether the downtrend will change 
• how Binance’s dominance is “terrifying” and whether it could hurt the industry
• Lucas’ concerns about the lack of transparency around Binance’s BNB token

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Links

Guests:

Lucas :

• Twitter
• CoinMetrics

Larry:

• Twitter
• The Block Research
• Previous appearances on Unchained:
  • Larry Cermak of The Block on What 90% of Bitcoin Trading Is For

The year in crypto:

FTX

Previous coverage of Unchained on Sam Bankman-Fried and FTX:

• Why Martin Shkreli Thinks SBF’s New Judge Could Still Be Lenient – Ep. 438
• The Chopping Block: Was FTX a Scam From the Very Beginning? 
• How Much Prison Time Is FTX’s Sam Bankman-Fried Facing? 
• Why the Legal Process for FTX and Sam Bankman-Fried Could Take Years
• The Chopping Block: SBF Wants to Win in the Court of Public Opinion. Will He?
• Jesse Powell and Kevin Zhou on How FTX and Alameda Lost $10 Billion
• Is the Collapse of Crypto Lending Over, or Is It Just Starting?
• Did the Bahamian Government Direct SBF and Gary Wang to Hack FTX?
• The Chopping Block: Why Lenders Didn’t Liquidate Alameda When It Was Underwater 
• Erik Voorhees and Cobie on Why FTX Loaned Out Customers’ Assets
• The Chopping Block: FTX: The Biggest Collapse in the History of Crypto?
• Sam Bankman-Fried on How to Prevent the Next Terra and 3AC

NFTs:

• The Block: From CryptoPunks to Redditors — and a Trump card: The year in NFT charts
• CoinDesk: Over $30B of NFT Trading Volume on Ethereum Is Wash Trading, Research Suggests
• NFT Market Overview

MEV: 

• MEV Watch
• Flashbots dashboard
• Unchained: Why Is Ethereum Trying to Maximize Value From Users? Two Sides Debate

BTC Mining:

• The Block: Bitcoin mining companies close out year $4 billion in debt: Report
• Unchained: Bitcoin Miners Going Bankrupt? Here’s How Crypto Winter Is Impacting the Industry

Contagion: 

• Genesis/DCG:
  • Unchained:
    • ​​Genesis May Be Facing Bankruptcy. Could It Take DCG Down With It? 
    • Genesis Owes Creditors At Least $1.8B: Report