At this year’s World Economic Forum (WEF) in Davos, Switzerland, business leaders expressed a cautious optimism. In comparison to past years, the area of finance was much less busy. Jennifer Schonberger of Yahoo Finance reported that the “crypto houses every ten feet, the bitcoin-themed pizza stands, and the hype from years past” were all gone.
Jeremy Allaire, CEO and co-founder of Circle which issues the USDC stablecoin, said that “a transparent regulated infrastructure like ours is well-suited for this environment.” The company, one of the few crypto-firms present at the event, is hoping to be listed in the near future, although it currently does not have a money transmitter licence in nearly all states. Allaire reported that the stablecoin has grown since the FTX crash in November, now accounting for 31% of the $136 billion stablecoin marketplace, which many consider to be essential for the industry’s future.
However, there were plenty of critics at Davos. Nouriel Roubini, professor at New York University and known as “Dr. Doom,” told Yahoo Finance Live that “literally 99% of cryptocurrency is a scam. A criminal activity. A real total bubble Ponzi scheme that is bankrupt.” The economist also said that the loss of trust in the industry and its reputation was detrimental.
In November, Bitcoin FTX reached a two-year low of $15,682, and two weeks later, BlockFi followed. Sam Bankman-Fried, the most well-known star in the industry, faced fraud charges in the Bahamas and New York. As a result, companies in the industry had to lay off thousands of employees, and at least 10 million people lost their crypto due to the bankruptcy filing of Genesis on Friday.
IBM Vice President Gary Cohn commented on global trends without excluding cryptocurrencies, but resisted any comment about digital assets. While the country’s stock market has rebounded to $1 trillion, many trading companies in the industry are still struggling to regain their confidence.
At this point, it is still too early to tell if the crypto industry will recover from its collapse. The CEOs at Davos have made it clear that they are still uncertain about the future of the industry.
As the cryptocurrency market continues to experience its difficult 2022, the World Economic Forum (WEF) in Davos, Switzerland brought together executives from around the world to discuss the future of the industry.
The consensus among the CEOs was that blockchain and crypto have a bright future, but the timing of their success is uncertain. Microsoft CEO Satya Nadella spoke of the need for “killer apps”, or use cases, to achieve wide adoption.
The Electric Capital venture capital firm released a report showing that crypto has more active users than it did during its bull markets. The data from several years ago showed that software developers are less sensitive to market fluctuations and that participation is more important than attendance.
Beyond Bitcoin and Ethereum, the industry has seen a growth from 1 to 23343 full-time open source developers in the past 14 years. This growth speaks to the resilience of the crypto market despite its recent slump.
Chainalysis’s Michael Gronager, who was in attendance at Davos, told us that cryptocurrency is not the best way to make quick cash, but that the industry is still “pretty cool”.
The future of crypto is still uncertain, but the WEF’s discussion between executives shows that the industry is still alive and well. We will have to wait to see what the thousands of developers do with crypto, but the WEF has provided a glimpse of hope for the industry.
