Most likely, you have come across the opinion that «shock therapy», the crypto industry experienced in 2018 was not only necessary but also beneficial to the long-term success of the emerging industry. The harsh bear market has proven to be the best incentive for many startups and blockchain companies. The collapse of the crypto market forced projects that were bathed in money during last year’s hype to recover and start working hard to survive..
Back to reality in 2018
The outgoing year was a wake-up call that awakened the crypto market from last year’s hype, when dubious characters managed to collect $ 30 million each, having only an idea, WP and a website. The return to reality has led to the realization that fiat is still leading the parade, investors want to make a profit, and governments can easily set rules that discourage anyone from investing in this area..
Although, unlike the financial market, government measures for rescue are not provided here, but ironically, punishments and penalties are determined by current laws, which, in principle, should not even apply to such activities..
Recently, we have also begun to mention the word decentralization more and more often, without attaching importance to its power and potential consequences for the future world. Many have simply forgotten how the cryptoindustry was born. Initially, no one hoped that global adoption would be easy and quick. Essentially decentralization – it is a covert struggle against governments, oppressive financial systems, irresponsible and greedy corporations. And nothing has changed significantly over the past 10 years..
2017: more harm than good
Despite the fact that 2017 brought real popularity to the crypto market, the truth is that the excitement of this scale was completely unfounded. However, we are not talking about bitcoin, which has grown as a result of the market bull run. It has existed for a decade, has proven its reliability, relevance and potential as an alternative means of payment, savings and payment system. Experts understand that he is not going anywhere, and his network will gradually grow. Despite the crisis, the number of registered bitcoin addresses doubled in 2018.
What was really unwarranted was the ICO craze, which was incredibly hyped. This caused irreparable harm to the already well-known abbreviation for the initial placement of coins. Therefore, now startups are resorting to various methods and mechanisms of raising funds (PTO, IEO, MNO and others), only to distance themselves from this annoying and many intolerant combination of three letters. At the same time, even last year, everyone understood perfectly well that 90% of projects would fail, but how could you object to something when they showed x10 or even x100 and everyone was happy.
Many developers simply could not resist the temptation to whip up a white paper, build an attractive website full of buzzwords in order to quickly earn their million, or even more. Events in the ICO market unfolded so rapidly and intensely that regulators were simply not even given the opportunity to study the specifics of the process of creating a new asset class..
This has led to the fact that many countries have banned uncontrolled initial offerings, and some and any cryptocurrency in principle, labeling all of them as risky and fraudulent tools that threaten the financial stability of the economy and citizens. Many investors themselves also quickly became disillusioned with useless products, which in most cases «changed the world» only for their developers.
Looking into 2019
The cost of altcoins has now become almost irrelevant. 2018 did the same with them as time did with CDs. However, thousands of leading cryptographers, engineers and developers are actively building the infrastructure needed for a decentralized network that many call web 3.0..
2019 is sure to be an exciting year and there is quite a lot at stake. Billions of dollars are still being invested in R&D and blockchain-related projects, it’s not just Bitcoin anymore. The rivalry is for global acceptance. What protocol will be the next IPv4, HTTP, SMTP, will there be one and who will launch a new analogue of Facebook on the blockchain? Will any one platform become a clear leader or competition will provoke rapid development, and which cryptocurrencies will prove to be viable, having successfully survived the crisis?
The Problem With The 2021 Bitcoin Bubble
At the moment, the infrastructure of most promising projects is practically not being improved or tested, which leads to the formation of a group of leaders and their separation from their pursuers. Therefore, even the largest representatives of the cryptoindustry remembered the profitability indicators and launched a large-scale reorganization, cutting entire divisions and focusing on the most promising and necessary areas for the market.
At the same time, there is a rapid distance from the speculative market. All investors started due diligence before investing. Although scam projects continue to be brought to the market, according to Lunar Digital Assets, only about 1% of the total number of blockchain startups launched are currently receiving funding..
The 2018 crisis effectively poisoned the soil for the rise of fraudulent schemes, forcing companies to start working hard to continue their existence. In such conditions of natural selection, only the strongest will be able to survive, those who in the future can proudly declare that they really deserve success..
Blockchain projects cannot be assessed in the same way as traditional companies. Bitcoin started out as an ideological movement backed by a small group of cryptographers. So far, the single most important factor for a project’s survival is its community, which forms its network, value and liquidity..
Many experts argue that 2018 was the most important period for decentralization. Of course, a lot of people have lost a lot of money, there have been scams, thefts, and the market could provide a better environment to protect consumers and the industry as a whole. However, despite virtual currency rates, the industry has grown faster than ever..
At the same time, the market is still in the era of CDs and most of it is free. It is possible that after stabilization and return to normal rhythm, we will see much more interesting projects that will not allow doubting their value..
In 2019, we will discover which teams are talented, which technologies are scalable and flexible, and which ideas are truly usable. Analysts also predict and the resumption of growth in the crypto market next year.
text: Ivan Malichenko, photo: content.choiz, unsplash