Have crypto assets (virtual currencies) made a comeback? Every other week, news appears that Bitcoin (BTC) and Ethereum (ETH) are trading at prices not seen since 2021, when the crypto asset market was soaring. There are no signs that price increases are going to stop anytime soon, and things look different this time around.

The pandemic-era bull market was a time of mass enthusiasm, excitement and fun. It seemed like everyone from Elon Musk to my mother was talking about cryptocurrencies. Celebrities promoted meme coins and purchased NFTs. Cryptoassets have become a cultural touchstone. Perhaps crypto assets were the best representation of the economic tremors as the world restarted after the pandemic and entered a strange era of “atmosphere.”

In comparison, the recent rally has been quiet. Indeed, several friends have asked me if they should buy Bitcoin. This can be said to be an indicator of increasing interest from individual investors. However, overall, as crypto asset prices rise, not many people seem to be paying attention.

Of course, 2022 has seen a series of protocol collapses and company bankruptcies, starting with the collapse of Terra and ending with the collapse of FTX, making crypto assets difficult to talk about. Amid such disappointment, it is difficult to regain the enthusiasm and cheerfulness that we once had.

There are many indicators other than price trends that indicate that a full-fledged recovery in the crypto asset market has begun. MetaMask, the primary means of accessing the Ethereum network, is nearing an all-time high in monthly active users (30 million). Coinbase, the largest cryptocurrency exchange in the United States, posted its first quarterly profit in two years as trading volume recovered. Google Trends also shows that search interest in Bitcoin is recovering (albeit slightly).

Factors attracting increasing attention

There are a number of factors that may be driving the increased interest. Bitcoin halving is an event that occurs approximately every four years and is always a popular topic in the media. Airdrops of meme coins and tokens are reinforcing the idea that the crypto industry is handing out free money to people.

Cryptocurrencies are technologically important, with endorsements from figures like BlackRock CEO Larry Fink and even government agencies like Hong Kong and the United Arab Emirates. Awareness is being created.

Most notably, the launch of more than 10 Bitcoin ETFs went better than expected. BlackRock’s Bitcoin ETF has already had the fifth-highest inflows of all ETFs this year, with billions flowing into Bitcoin ETFs overall.

Moreover, there is growing belief that the worst may be over for crypto assets when it comes to the law. Major issues of concern have been more or less resolved, and there have been a number of favorable outcomes for crypto assets.

The Department of Justice has settled with Binance, imposing stiff penalties, but the world’s largest exchange appears to be able to withstand the penalties. The U.S. Securities and Exchange Commission (SEC)’s crypto-industry-hostile approach to “enforcement regulation” is set to end with Ripple winning a legal battle and the commission facing other challenges in court. I was attacked for what I did.

And FTX’s bankruptcy proceedings are coming to an end, with full refunds expected to all former users.

Governments, including the United States, are increasingly willing to work with industry to develop policies that protect consumers without hindering the development of crypto assets.

The European Union (EU) has passed an important regulation, MiCA, and countries such as the UK, Hong Kong and Nigeria are poised to become global hubs for crypto assets.

It’s different this time

For journalists to predict the future, especially in an industry as volatile and fast-changing as cryptocurrencies, is not only foolish but equally dangerous.

There is no guarantee that Bitcoin’s rise will continue, and there is always a chance that the price movement will reverse. However, it is certain that there is a growing view that crypto assets are at a turning point.

Many things have changed since 2021, and many of them are for the better. With increased buzz, crypto assets have a chance to do better this time. Let’s ditch the shameless celebrity endorsements, reckless speculation, pure fraud, re-collateralization and backroom deals that defined the bad vibes of crypto last time, and focus on developing something more substantial and long-lasting.

｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
｜Image: Shutterstock
｜Original text: Does Anyone Else Feel the Crypto Vibe Shift?