Circle CEO Jeremy Allaire predicts increased corporate insolvencies in 2023 due to scrutiny and contagion.
Jeremy Allaire remarked on January 16 at the World Economic Forum in Davos that crypto firms and businesses will struggle to survive and raise funds in 2023 due to crypto contagion.
According to Circle CEO Jeremy Allaire, additional bankruptcies will occur in the cryptocurrency market in 2023 as businesses continue to face early difficulties. He is however upbeat about market technical advancements and an increase in the adoption rate of cryptocurrencies in 2023 as a result of advancements in regulatory frameworks and standards.
Circle CEO Jeremy Allaire stated on January 16 at the World Economic Forum in Davos that the crypto sector will continue to be affected by crypto contagion in 2023 as crypto enterprises and businesses will struggle to exist or raise money.
He thinks that players are facing greater hurdles as a result of increased regulatory and law enforcement attention, which might be harmful for the cryptocurrency sector. But despite rules putting cryptocurrencies in the spotlight, he is still upbeat about the business in 2023.
While regulating the cryptocurrency market will take some time, it will eventually be able to tell good participants from bad.
According to Jeremy Allaire, the year 2023 will see advancements in Layer-1 blockchain technology, Layer-2 scaling techniques, and new identity, privacy, and security-related technologies. There won't be a slowdown in technological advancements in the crypto sector.
Allaire brought up the publication of the "State of the USDC Economy" study when discussing the effects of USDC on the market and economy. The paper emphasises USD Coin's (USDC) potential in the payments sector and future integration into the M2 money supply.
According to the study, Circle backs USDC with U.S. dollar assets, holding 20% of its reserves in cash held at banks and 80% of its reserves in 3-month U.S. Treasury bonds. Circle will transfer reserves into the Circle Reserve Fund by the end of January. This fund is 100% owned by Circle, is run by BlackRock, and is held in trust by The Bank of New York Mellon.
Statutory definitions of digital assets are required in important markets like the U.S. in order to offer regulatory clarity for the cryptocurrency market. The SEC and the CFTC's disagreement over cryptocurrency regulation will be settled in 2023 when multiple bills pertaining to digital assets are signed by the US Congress.
The Markets in Crypto-Assets (MiCA) bill's ultimate decision will be made by the European Union in April. The MiCA regulations won't take effect until 2024, but they will accelerate the adoption of cryptocurrencies in the area.
