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Posted on Jan 26th, 2023

3 Things That Will Shape the Crypto Landscape in 2023


Haan Palcu-Chang

Crypto Specialist

The coming year will be a very important one for crypto, as the industry recalibrates after a 2022 that saw a lot of turmoil. There will be lots to keep an eye on as crypto-based projects adapt to higher interest rates, less money in markets, and a competitive landscape that will include more compelling yields from traditional cash instruments such as savings accounts and bonds.

Here are 3 key topics that we believe will impact the crypto ecosystem in 2023 and influence the future trajectory of the sector.

1. Ethereum’s Shanghai Upgrade and other improvements

Ethereum pulled off what many people believe to be the most ambitious and complicated software upgrade in the history of blockchain when it completed the Merge last September.

Focus has now shifted towards the next Ethereum upgrade scheduled for March 2023. Known as the Shanghai Upgrade, it will unlock the ability for users to withdraw their staked Ether.

Since 2020, validators could stake their Ether and earn rewards. However, once staked, the Ether would be permanently locked up in smart contracts, unable to move, be traded, or be sold. So, while they could gain attractive yields staking their Ether, validators had to contend with the undesirable tradeoff of an almost complete lack of liquidity.

Being able to un-stake Ether could have implications for the price of the asset depending on how certain scenarios play out. On the one hand, the ability to unlock staked Ether could result in a significant increase in staking demand as an influx of new validators are enticed to the network by a compelling combo of yield and a reversal of the non-existent liquidity that defined Ether staking over the past two plus years.

If we look at other leading proof-of-stake blockchains as case studies, it seems likely that this scenario will play out. Currently, around 13% of total Ether is being staked (1). In comparison, other high cap proof-of-stake blockchains (e.g., Cardano, Solana, Polkadot), which do not have significant lockup periods for their staking, have between 40-80% of their total coin supply staked. (2) It seems reasonable that Ethereum will follow suit once staking liquidity becomes less of an issue.

While this does seem like the most probable way for markets to react to the Ethereum staking upgrade, we can’t ignore the potential impact of the current macroeconomic backdrop on investors and validators. As the ability to un-stake Ether rolls out, it is also possible that validators decide to sell their coins for cash flow purposes or to mitigate losses on what has been a particularly harsh crypto winter. Those stakers who are in the green with their investments could also look to sell their Ether in order to take profits. If one or both of these narratives play out at scale, there could be downward sell pressure on Ether.

Staking Percentage in Leading Proof-Of-Stake Blockchains

The Shanghai Upgrade will also either directly implement, or pave the way to implement, a number of planned improvements to the network that could have significant long-term implications. One, known as EIP-3651, could have the potential to cut transaction fees for key network participants. (3)

Other improvements will further lay the groundwork for sharding. Sharding—a way to partition the transactional workload of blockchain validators making network processing faster and more efficient—is seen as key to Ethereum’s ability to scale. Sharding could greatly increase network capacity. Some estimates state that after sharding is fully rolled out, the Ethereum blockchain could process 100,000 transactions per second, making it even faster in speed than traditional payment platforms like Visa and Mastercard. (4)

With all the planned upgrades that could significantly impact the network’s usefulness and scalability, we believe Ethereum will be one to watch in 2023.

2. Bitcoin miners’ ability to recover and adapt

2022 was a very hard year for large bitcoin miners. Interest rate hikes increased costs of capital, energy prices made mining less profitable, and the price of bitcoin fell. All these factors were exacerbated by the fact that many of the leading miners were running business models predicated on operating during a crypto bull market.

This pain showed in stock prices of the top five publicly traded bitcoin miners, which fell by between 79%-99% last year. (5)

An excellent thread on public bitcoin miners in 2022. 

As we settle into 2023, the important question that needs to be answered is if large mining companies can restructure their business models and business practices to navigate the current macro climate in a sustainable way. One thing that seems certain is that they will need to evolve their risk management strategies, which largely failed over the course of the last 12 months.

Looking to more established industries for best practices when it comes to operating healthy business models—energy and commodities companies being particularly relevant reference points—is probably going to be a big theme among large miners.

It will also be very interesting to see what kind of mining solutions are developed throughout this bear market that will exploit or capitalize on the weakness shown by large, centralized miners last year.

Ultimately, bitcoin miners’ ability or inability to course correct from this past year, will go a long way in shaping the viability of the Bitcoin network over the long haul.

3. The real-world use cases of crypto projects

Coming off a tumultuous 2022, where even true crypto believers had their confidence shaken in the industry, crypto projects are really going to have to articulate why they should regain investor trust this year.

Yes, there is the wariness of investors still reeling from 2022’s high-profile scandals and implosions that crypto projects will have to navigate. But it’s also coming to terms with broader macroeconomic conditions that have shifted general investor sentiment farther in on the risk curve and, more specifically, from growth to value.

It’s going to be crucial for crypto projects and blockchains to demonstrate their utility and ability to create value and cash flow in the real world. They’re simply not going to be able to rely on speculative increases in token value as their core value model. For the crypto space to truly demonstrate its transformational potential, it will need to start gaining mainstream utility and adoption.

Projects, such as and Metropoly, are the type of initiatives that will be important to follow as we assess engagement with projects that are striving to serve more than crypto-native clients. is a digital marketplace for NFT e-books and audiobooks and enables writers and publishers to have more agency over their books, allowing them to take more profit from sales and get royalties when the NFTs are passed on to other people. While Metropoly aims to enable investors with the ability to fractionally buy income-generating real estate through NFTs.

2023 has to be the year crypto blockchains and projects show in concrete ways how they are improving or innovating on legacy systems.

Looking forward

2023 is looking to be a very interesting year for crypto. Despite the setbacks of the last 12 months, developers and teams operating on many of the main blockchains continue to upgrade networks, launch protocols and test out innovative business models. This could be the year that crypto skeptics become believers in the power and utility of blockchain and web3.

-Haan Palcu-Chang, Crypto Specialist


  1. “Earn rewards while securing Ethereum,” Ethereum:,new%20 Re: RE: Intact Claim #0034136836;blocks%20to%20the%20blockchain.
  2. “Cardano,” Staking Rewards:
  3. “What’s in and what’s out for Ethereum’s Shanghai Upgrade?” Coin Telegraph:
  4. “Ethereum Sharding: A Beginner’s Guide,” Coin Telegraph:
  5. “What will it take for bitcoin mining companies to survive in 2023?” CoinDesk:

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