A look at what 2023 may bring for crypto regulation in the US and globally, as bankruptcies stretch into the new year, attracting lawmakers and criminal probes
CoinDesk's policy team predicts the issues and topics that may take center stage over the next 12 months.
Context & Ripple Effects
This is CoinDesk's policy desk doing what it did at the end of 2018: framing the year ahead as a set of open regulatory questions rather than price calls. The difference is that this time the questions arrive mid-crisis — Congress had been slow to touch crypto until FTX's collapse transfixed lawmakers, who immediately began asking whether the failure was preventable.
The prediction that matters here is mechanism, not mood: bankruptcies stretching into 2023 give prosecutors and committees a rolling calendar of hearings and probes, which is exactly the sequence that later pushed some companies to scout financial hubs overseas like Singapore, Hong Kong, and Dubai (regulators expanding investigations).
First-order effects
- Executives of failed and distressed crypto firms face criminal probes and congressional scrutiny running through 2023, since each bankruptcy filing hands investigators new documents and witnesses.
- Lawmakers who had deferred crypto legislation now have a docket of live failures to legislate against, shifting the debate from whether to regulate to how fast.
Second-order effects
- As US investigations widen, companies respond by relocating or expanding into friendlier jurisdictions — Singapore, Hong Kong, Europe, Dubai — splitting the industry's operations and talent across regulatory regimes.
- Overseas hubs gain bargaining power: jurisdictions that clarify rules first can capture the exchanges and issuers the US process is pushing out.
Third-order effects
- If crisis-driven probes keep alternating with deregulatory windows — the same industry that braced for scrutiny in 2023 was anticipating lighter regulation under Trump by 2025 ([[a:880899]]) — crypto firms will structurally organize around jurisdictional arbitrage rather than any single home market.
- Stablecoins and other systemically-linked products become the likely focal point for whichever regulator moves next, because they are where private crypto failures can spill into traditional finance.
The trend: Crypto policy is settling into a boom-bust legislative cycle in which each wave of failures triggers enforcement and offshore relocation, then each political swing reopens the door — leaving the industry permanently distributed across competing regulatory regimes.