The Senate Agriculture Committee’s Digital Commodities Consumer Protection Act
The Ripple Court Case
Parliament's NFT collection
2022 was a tumultuous year and there's more to come in 2023. Whether we find ourselves in a bull or bear market largely depends on how these big events play out.
#1 The Sam Bankman-Fried Trial
SBF faces up to 115 years and although it looks bad, jail time might actually be good news for crypto. The damage has already been done by FTX's collapse. A conviction is more likely to instill confidence in the industry; additionally, it'll reassure nervous investors that crypto isn’t a lawless Wild West. If, on the other hand, SBF walks free, the markets might respond with fear.
#2 The Senate Agriculture Committee’s Digital Commodities Consumer Protection Act
The DCCPA could be game-changing in 2023. The bill would take crypto legislation out of the hands of the SEC and give it to the Commodity Futures Trading Commission instead. The CFTC is generally considered less strict than the SEC, and the bill would also give exchanges more power to decide whether tokens are classed as securities or commodities. Commodities are less regulated and generally favoured by crypto investors.
#3 Ethereum Sharding
Sharding is the act of splitting a database horizontally to spread the load, decreasing network congestion while simultaneously increasing the number of transactions per second. Sharding will also enable Layer 2s to offer even lower fees, making Ethereum more flexible, more user friendly and presumably boosting adoption. The price of ETH is likely to rise in anticipation of this development, as it did pre-Merge. Conversely, expect bearish sentiment if Sharding is hit by problems.
#4 The Ripple Court Case
Ripple's ongoing legal battle with the SEC is showing signs of concluding. A string of small victories might suggest a favourable outcome for Ripple but there could be twists to come. Whatever happens, this will be one of the most important stories of the year. If Ripple wins, expect a big XRP rally that takes the rest of the market with it.
#5 The UK government’s NFT collection
Crypto-loving UK Prime Minister Rishi Sunak has long been planning an NFT collection to showcase the country’s commitment to blockchain technology. Many presumed that the collection had been quietly shelved after the mid-2022 crash, but it's still alive and kicking. A government-backed NFT collection with a focus on long-term growth is big news and might well be enough to shake some confidence into the markets.