Victory over violence in 2024

The crypto industry experienced a remarkable revival in 2024, fueled by the Bitcoin bull run that pushed BTC's market value above $100,000, restoring investor confidence and fueling massive gains in the crypto market.

Among the many significant events recorded during the year, it is easy to overlook the major challenges that industry players and investors faced and successfully navigated.

The cryptocurrency industry has shown consistent resilience over the years, meeting challenges such as bad actors, ecosystem failures, bear markets, legal disputes, and geopolitical instability. This adaptation sets the industry up for continued evolution and potential disruptions in the future.

In addition, certain decisions by individuals and authorities had particularly harmful effects. Here, we examine some of the most significant challenges that the crypto ecosystem will collectively overcome in 2024.

Germany loses millions in unintended BTC sale.

Hoddle's strategy – which involves long-term accumulation and holding of Bitcoin (BTC) investments – has benefited BTC investors this year, with the market value rising above $100,000 in December. One of the biggest Bitcoin holders who made the expensive decision to sell 50,000 BTC in July 2024 was Germany.

Germany sold about 49,858 Bitcoins for 2.6 billion euros ($2.8 billion) between June 19 and July 12. The German government ordered an “emergency sale” of bitcoin held in June amid speculation that the cryptocurrency's price could fall by more than 10%.

Unfortunately for German price analysts, Bitcoin reached a new all-time high six months later, bringing the price of 50,000 BTC to over $5 billion.

The decision to sell Bitcoin was disastrous for the German government.

Still, countries like Bhutan and El Salvador continue to invest and hold their bitcoins. As a result, both countries received millions of dollars in undisclosed profits.

Bitcoin ATM Installers Flat Line

While an increase in Bitcoin and cryptocurrency ATM installations is not a direct indicator of crypto adoption, the ecosystem helps reduce the proximity between digital assets and the end user.

Regulators worldwide are actively cracking down on Bitcoin ATMs to prevent bad actors from defrauding investors, hiding stolen assets or withdrawing funds. On the other hand, major economies are introducing the installation of crypto ATMs to stay ahead of the innovation curve.

As a result, the overall development of the crypto ATM ecosystem in 2018 It increased in 2024. In January, the global crypto ATM network consisted of approximately 36,500 machines, which grew to 38,600 machines by the end of the year.

While countries like Australia will grow their ATM network to around 1,400 machines by 2024, the total number of ATMs worldwide will stagnate at an average of 38,000 machines from 2022.

In the coming year, clear regulations and operating licenses are expected to improve the crypto ATM landscape and allow more players to provide access to grassroots crypto to the masses.

The Journey from Bitcoin Runes to Ruins

The Bitcoin Runes protocol was launched on April 2 as a more efficient replacement for Bitcoin Ordinals and to improve the NFT text ecosystem.

Bitcoin Runes were initially well received by the Bitcoin community. In the first two months, Runes transactions dominated the Bitcoin blockchain, often taking 60% of the total bandwidth.

The hype around Bitcoin Runes has boosted interest in the Bitcoin network and helped miners maintain their earnings amid the recent reduction in rewards due to the fourth halving event.

However, going into July, the total number of daily transactions for Bitcoin Runes recorded a significant decrease. In December, Runes transactions represented roughly 5% of all transactions on the Bitcoin blockchain.

Ordinals, on the other hand, have regained interest among investors and currently occupy the most bandwidth on the blockchain after the original Bitcoin token.

Regulations force the closure of crypto services

Due to the mainstream adoption of Crypto, regulators around the world have recognized the importance of licensing operations if they are to protect citizens from fraud and risk. In the process, well-established crypto exchanges were forced to close their operations in various jurisdictions.

China

Chinese authorities continue to push for a 2022 crypto market ban to reduce the money supply from the fiat economy. Despite the fort, Chinese players continue to dominate the crypto mining landscape.

According to CryptoQuant data, over 55% of the Bitcoin mining network is still controlled by Chinese mining pools, despite an active ban on crypto trading.

Hong Kong has enacted a strict licensing system, requiring all crypto exchanges to apply for an operating license by May 2024. However, the Hong Kong Securities and Futures Commission (SFC) accepted license requests from operators beyond the deadline.

India

India has revealed issues with the tax collection process implemented by several crypto exchanges. In total, 17 crypto exchanges including Binance, WazirX and CoinDCX have been flagged for unpaid Goods and Services Tax (GST) taxes. In total, crypto exchanges in India owe $97 million in unpaid GST tax to the Indian government.

Argument against Binance executives

Binance's top executives – Binance founder and former CEO Changpeng “CZ” Zhao and the company's compliance officer Tigran Gambaryan – have been dragged into legal battles with authorities this year.

CZ pleaded guilty to violating the Bank Secrecy Act (BSA) and failing to implement an effective anti-money laundering (AML) program at Binance and was sentenced to four months in prison.

Gambarian was first hit with tax and money laundering charges in Nigeria. Unlike CZ, Gambarian was freed from the initial ban after the Nigerian government dropped the case at the Federal High Court in the Nigerian capital, Abuja.

To Binance's credit, the crypto exchange has maintained investor confidence in the platform and remains the top crypto exchange in terms of daily trading volume.

Summary

The events discussed above illustrate the many unique obstacles that the crypto ecosystem has overcome. Overcoming such legal and operational challenges demonstrates the resilience and adaptability of the industry in times of crisis.

From navigating regulatory actions and unfavorable government decisions to managing the fallout from failed projects and legal disputes, the cryptocurrency space has demonstrated its ability to evolve and learn from past missteps.

As global adoption grows and regulations become clearer, the lessons of 2024 reinforce the importance of strategic decision-making, long-term vision and efforts to build a stronger and more inclusive financial ecosystem.

The progress achieved, despite these obstacles, positions the industry for continued sustainability and innovation.