Cryptocurrency
How the Crypto Crash Could Be Good for Crypto via @crypto
As reported by Bloomberg Crypto (Opinion), “These days, cryptocurrencies are far from the rage. Many have lost 80 percent or more of their market value from their peak in January, and some have fallen off the map altogether. But perhaps that development is precisely what we need for crypto to take the next step forward. “For context, railroad […]
As reported by Bloomberg Crypto (Opinion), “These days, cryptocurrencies are far from the rage. Many have lost 80 percent or more of their market value from their peak in January, and some have fallen off the map altogether. But perhaps that development is precisely what we need for crypto to take the next step forward.
“For context, railroad stocks collapsed after a bubble in the 19th century, but still the railroad continued to transform our world. Internet stocks plunged in the dot-com crash of 2000-2002, but that in turn cleaned out the bad companies and paved the way for the subsequent tech revolution, including the rise of Amazon and Google.
“This history is no guarantee crypto will take off. But it does show that a price collapse does not have to herald the end of a technology or its relevance.
“One problem crypto has had is that too many junky ideas were tossed around and then often funded by ICOs (initial coin offerings). That is hardly a surprise, given that the asset class went from basically zero to more than $800 billion value at its peak. People will try to get their share of that pie, and that will lead to thousands of white papers, startups, frauds and, yes, some valuable innovations.
“But from an outsider’s point of view, it is hard to tell good from bad. With many people crypto still has a dubious reputation, due to lingering and not entirely accidental connections with get-rich-quick schemes, money laundering and the drug trade. New markets, including valuable ones, are often abused at first.
“Now the time has come for crypto to go on a diet. No more easy money. No more thoughts about ICOs leading to quick riches. The rhetoric is shifting toward a more cautious or even apologetic tone. The corresponding reality can perhaps be one of greater focus and relevance.”