The meltdown of FTX has sent the price of bitcoin and other cryptocurrencies tumbling more than 60% this year…and the carnage has spread to publicly traded companies with exposure to digital assets.

Shares of Coinbase, Square-owner Block, top bitcoin miners Hive and Riot, crypto bank Silvergate and software firm MicroStrategy, led by crypto evangelist Michael Saylor, have all plummeted in the past month.

But is the worst almost over? After all, volatility has been a constant in this still nascent industry. Crypto is notorious for big plunges and stunningly epic comebacks.

This is not the first crypto winter, as long-term fans of bitcoin can attest. There were massive corrections in 2018, the early part of 2020 and the summer of 2021 as well.

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So could crypto prices and stocks stage a rebound in 2023? Some crypto bulls think so…but they believe that investors need to have more reasonable expectations.

“It is very clear that we as an industry need to build better products,” said Hany Rashwan, CEO of 21.co, a crypto investment firm. “There has been a lot of fluff in the past bull market. People were chasing exuberance.”

Still, Rashwan said that he’s a bit surprised the crypto carnage hasn’t been even worse.

As bad as the recent sell-off has been (bitcoin plunged more than 15% in November alone) the price of bitcoin is still hovering around $17,000. That’s about triple where prices were during the depths of the crypto bear market in the early pandemic days of 2020.

“How are we still approaching $17,000? That says something. It’s indicative that people are still using cryptos and trying to safeguard assets. Trust hasn’t been shaken to the core,” Rashwan said.

Others point out that the underlying blockchain technology behind bitcoin and crypto remains solid.

“We are going to see some challenges for the foreseeable future. But we do expect improvements ultimately. This will be a catalyst. There will be growing institutional adoption,” said John Avery, strategy and product leader for crypto, Web3 and capital markets at FIS.

Avery said he also expects to see more regulatory clarity for cryptos in 2023. That ultimately will be a good thing.

“There is always that need to balance innovation and investor protection,” he said. “Regulation doesn’t always solve for all of this. But it is important.”

Others point out that the rapid demise of FTX should also serve to strengthen the companies that survive this crypto meltdown. Coinbase in particular could wind up benefiting over the long haul, even though the stock is taking a beating currently.

“FTX’s rapid failure will invite further regulatory oversight and scrutiny of the sector, which we expect will ultimately translate into clearer guidelines for crypto market participants,” said Fadi Massih, vice president of the financial institutions group with Moody’s Investors Service. “This would likely benefit Coinbase, given its size and more established position in the sector.”

But the troubles in crypto should hopefully prove once and for all to investors that bitcoin is not (nor will it ever likely be) a replacement for the US dollar or other government-backed currencies. Cryptos are still a speculative asset. That’s not a problem per se. But investors just have to know the risks.

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“Cryptocurrencies have been lauded by some for their decentralized nature, ease of transaction and low transaction costs, but even bitcoin, the oldest cryptocurrency, continues to be more volatile than stocks and bonds, precluding it from being a viable store of value,” said Jason Pride, chief investment officer of private wealth and Michael Reynolds, vice president of investment strategy at Glenmede, in a report.

Pride and Reynolds added that it’s erroneous to think that bitcoin can hold up well during stock market volatility. Instead, this year has proven that crypto is not a a good hedge, especially when tech stocks tank. So that also “greatly limits its use as a portfolio diversifier.”