It feels like we say this every December, but 2022 was a year unlike any other the token ecosystem has faced. After a surge in crypto interest pushed the value of the token economy to $3 trillion in 2021, the ecosystem suffered a $2 trillion rout in 2022 amid industry-shaking collapses and global macroeconomic uncertainty. While 2022 was unforgiving, it was also a transformative year for many of us. token.com successfully launched in Brazil over the summer, and across the space projects have taken stock of recent events to assess how the industry can build stronger foundations for the future. While the world of cryptocurrency and tokenization is famously unpredictable, this technology’s most ardent believers remain utterly convinced on blockchain’s potential to create a better world. This piece looks at how we’ve been building for that future in a challenging moment for the space.
Although 2022 will likely be remembered for some of the less positive news events, it’s important to note that there were many promising developments throughout the year. The world’s most used blockchain network, Ethereum, completed its long-awaited Merge to Proof-of-Stake in September, instantly becoming 99% more energy efficient and more secure. The decentralised finance ecosystem proved its resilience through several turbulent crashes, and developers have made huge progress on new technologies like Layer 2 ZK-Rollups. Nonetheless, it’s hard to escape how the major stories of the year impacted the space. The Federal Reserve hiked interest rates throughout the year to curb inflation, causing drawdowns in crypto and other risk assets. The Terra blockchain’s collapse wreaked havoc across the industry in May, resulting in a $40 billion wipeout and multiple high-profile bankruptcies. More recently, the FTX exchange’s sudden implosion has also shaken the industry. The revelation that FTX did not secure its customers’ deposits has highlighted the value of decentralised technology and need for transparency among exchanges and projects like token.com.
As the token ecosystem evolves at a fast pace, projects must always stay agile. We reacted quickly to this year’s events, a testament to our focus on building and commitment to the long-term future of tokenization. After Terra’s collapse, we integrated Circle’s USDC stablecoin into the app and pivoted away from offering a yield product. token.com launched in Brazil in August with a suite of Collections, curated sets of tokens that serve as an accessible entry point for people looking to explore the ecosystem and discover the wonders of tokenization. Over the past few months, we’ve launched Collections for all of the main strands of the token universe in 2022 with over 100 tokens supported. As always, we offer several guarantees to token.com customers: we maintain 1:1 balances for all of our customers’ deposits, we offer withdrawals 24/7, and we manage all counterparty risks.
Throughout 2022, we met many other projects and companies that remain as committed as us to building the future of the token economy. While most were taken by surprise by the events of this year, it’s clear that crypto’s biggest champions are as focused as ever on the path ahead. In fact, there’s an overriding sense that the token ecosystem’s foundations should be stronger after this year’s washouts. 2022 also proved that education is key to unlocking mass token adoption, something we’re doubling down on through our snackable, visual-led app experience. The sheer breadth of storytelling token.com Collections shows our belief in tokenization, and yet we have still barely started. The token economy is still in its infancy, and there may be more unexpected hurdles ahead. But we believe the reward will be worth it. This is a decades-long movement that’s set to transform our society forever, and the best is yet to come.
The token.com team
Please note: Investing in cryptoassets is risky. Due to the volatile nature of the cryptocurrency market, investors run the risk of losing their funds when they make an investment. Returns from cryptoasset investing are not guaranteed, therefore users should always be aware of the risks.
