joining me now to discuss the past year and
what to expect for the crypto market in 2023
is john Haar managing director of swan private client services at swan
Bitcoin and john thanks so much for joining us this morning.
Obviously you know the May 2022 crypto market crash was devastating.
The market is still feeling the shockwaves of
that event in addition to others later on.
So let's talk about that collapse. What gave way to it?
Yeah good morning. Thanks for having me on.
So I would say 2022 Bitcoin's price was mainly driven by a few different things
but mainly the broader macro environment being quite
weak and then several crypto contagion events.
And on the macro side we had C. P. I.
Being higher than expected stickier than most people expected.
This caused the Fed to raise interest rates more quickly than people expected.
And this led to what some people were calling the popping of the everything bubble.
So you had a year in 2022 where stocks bonds.
Bitcoin crypto we're all down very materially
and then on the crypto contagion side there were
multiple collapses in 2022 including some crypto tokens as
well as platforms so that includes names that people
have probably heard but things like terra luna Celsius,
Voyager block fi uh and most recently Alameda and F.
T. X.
Now to be clear the collapses of these tokens and platforms
does not directly affect Bitcoin as a network and a protocol
But the collapses do affect Bitcoin's price because they lead
to significant selling pressure plus negative narrative surrounding Bitcoin,
which which do matter.
But pretty amazingly in the face of all that Bitcoin today is
still a global monetary asset which is valued at approximately $325 billion.
Thanks for all that context. Now you mentioned F T X. Of course not a day goes by.
It seems like that we don't have a new headline about about
the F T X collapse or its founder Sam Beckman freed.
What key lessons can we learn from that?
Sure, let's start with the big one, which is Bitcoin does not equal crypto.
And to compare Bitcoin and crypto, you've got to ask yourself what is Bitcoin?
Bitcoin is non state immutable digital fixed supply,
peer to peer censorship resistant money.
Crypto on the other hand,
I'm not sure if you could get a clear answer as to what exactly crypto is
and different tokens and projects will have
very different answers to that question.
And even the same project might change their answer from one year to another.
And one thing we saw very clearly in 2022 is that
the world of crypto has a lot of flaw designs,
pump and dump schemes, unregistered securities or just outright scams.
So that's Bitcoin not crypto and number two would be
the importance of self custody versus third party custody.
So if you held your Bitcoin in your own self custody during 2022 that
means you were just a spectator for the collapse of Celsius Block fi FT.
X. Etcetera.
Unfortunately a lot of people learned this lesson the hard way
and this is why Bitcoins are constantly saying not your keys,
not your Bitcoin
and then an additional lesson learned also related to custody would
just be if you're going to use a third party custodian.
I think the F. T. X.
Collapse highlighted the fact that there are
very different custodians out there there are some
platforms which will use customer funds to engage
in very risky or maybe fraudulent activities.
And there are other platforms that just exist as
pure custodians which which actually just hold your assets.
But I do have to stress the fact that if you take self custody of
your Bitcoin you no longer need to trust or worry about what a custodian is doing
alright john unfortunately that is all we have time for today but thank you
so much for breaking that down for us and giving us all that context.
That's john Hart,
Managing director of swan private client services at Swan Bitcoin