When winter comes, batten down the hatches. They say the best way to hibernate is to stow away in the storm cellar, hole up and wait for it all to blow over. Institutional cryptocurrency heads don’t agree: they think it is the best time to start building for the future.
The Long-Term Benefits of the Crypto Winter
Through market turmoil, continued uncertainty, and shaky investor confidence Nicolas Vereecke from the Investment Team at BITKRAFT, and Mauricio Magaldi, the Global Strategy Director for Crypto at 11:FS, spoke about the frosty times with Bo Brustkern for a webinar on-demand here.
Tune in to discover why these industry vets believe winter is build season. Erica Stanford was not able to attend.
Here is a quick preview into their conversation, focusing on where the market bear attacks and why.
‘The purge before the merge’
Magaldi, the Blockchain Insider podcast host, said he has been studying crypto since 2014. He first worked directly in the blockchain industry in 2017, working at IBM’s blockchain service consulting. He said the prices of cryptocurrencies are being “pummeled by perception,” but the underlying tech is only growing. Brustkern called it the purge before the merge, the credit check before yet another explosion of new tech as legacy and blockchain collide.
“Real defi protocols are still standing, and the blockchain is running,” he said. This cycle is harsh but shows more resilience than last time he said, and calling the winter a purge instead of a bear market was more optimistic.
“I am optimistic, we’re showing a lot of resilience on points that didn’t exist in the previous down cycle,” he said. “We came out of a huge speculation cycle, but with blockchain technology, it’s the first time in the history of markets we can price technology. In the real-time.”
“If we call it the purge instead of the bear, It sounds a better proposition, and I’m more optimistic about what comes in the future.”
What can we learn from the winter of ’18
Vereecke, an investor at crypto VC firm BITKRAFT gained his experience investing in crypto videogames and said this time around; the perspective has shifted:
“It does seem to me like the feelings of the people have changed in the markets; we’re kind of happy because we see valuations come back to earth, and I think it’s a good time to build, to invest, and to focus on utility instead of speculation.”
The type of shift Vereecke said he was paying attention to was infrastructure and UX improvements in the crypto gaming space. He said the world has woken up to the reality that people already use video games to make a living, and that awareness was not there even four years ago. He said the industry needs to avoid skeuomorphism, a term he defined as doing something old with new technology.
“We’re going to have crypto and NFTs on top, and it’s going to be amazing; everyone’s going to love this,” he said. “There’s a lot of massive demos like World of Warcraft that a lot of people earn money from right now in South America. Many people were farming gold in World of Warcraft and selling that on Gray markets to make a living.”
He said the future is built by founders that come to him and say, “I’m building this with blockchain because I can’t build it any other way.”
