• 2022’s crypto collapse wiped out roughly $2 trillion worth of crypto assets.
• As the sector enters a period of stability, good actors must come together to deliver a digital assets industry that promotes the safe, sound and compliant development of blockchain-powered tech.

Consumers, businesses and investors around the world lost nearly $2 trillion in the digital assets market last year. By any measure, the systemic failures in the digital assets market in 2022 were eye-watering — some argue they are still reverberating in 2023, with correlations in the evolving banking crisis.

Many of 2022’s crypto losses were triggered by a daisy chain of events that began with the collapse of the stable-in-name-only Terra-Luna token, and were punctuated by the collapse of FTX.

The remaining viable players in the crypto industry must take a hard look in the mirror to regain market trust, particularly among regulators and policymakers. Regulators and policymakers, meanwhile, should take heed in not overreacting to crypto risks but responsibly harness the technology.

With jurisdictions adopting policies across the spectrum, de-banking and de-risking are emerging as major threats to the industry. These trends have unintended consequences and, over time, may produce more harm to the countries (and markets) that adopt these policies than the knee-jerk corrections to last year’s financial misdeeds.

Countries that lead in the development of the third generation of the internet (what some are calling Web3), and the novel industries and business models it will produce (including in the core of finance and banking), will prevail in the digital currency race.

Read more: WEForum