This is just the beginning of crypto winter.
What do I think about this crypto winter? I look at key businesses, the players and movements, and see whether it changes or not in this season. The cycles we have witnessed in the past two years in the Web3 space are the same as when Web2 was at this stage over 20 years ago. Spring cleaning has started and will continue in various forms.
Look at these few movements in June alone, and you can get a glimpse of what is to come. For one thing, crypto winter is not stopping traditional companies from springing toward Web3 business models. Some cases are below:
1. In mid-June, Bitcoin (BTC) has fallen as low as US$17,000 USD per coin, bringing Bitcoin back to the January 2018 price point (around US$ 17,527). The highest Bitcoin ever got to was US$68,000 in November 2021. Today (June 24, 2022), BTC is hovering around US$20,297. So far, there is no news about any companies that will stop accepting Bitcoin, which would be an important and influential action.
2. The demise of Luna and Celsius due to “illegal activities” behind the corporate doors has caused massive withdrawals not only in terms of crypto but also in investments into the space.
3. The freezing of withdrawals, dropping of new hires and letting go of staff in crypto companies, like Coinbase, Crypto.com and Gemini, have made this winter even colder. Many believe this is just the beginning, and the “snow” will fall even harder as we go through summer to fall.
In my belief, this is the “experimenting and discovery” stage where “fluffs” and “blind trend followers” or “money grabbers” without the grounds of real technology or business values or impact on our world will die out.
Despite these frightening events, big household names are not stopping their moving into the Web3 business space.
1. On June 9, 2022, Mastercard extended its payment gateway to a few Web3 companies, allowing their customers to buy NFTs without buying cryptocurrency at all. This will be effective with Immutable X, Candy Digital, The Sandbox, Mintable, Spring, Nifty Gateway and Web3 infrastructure provider MoonPay. Imagine allowing 2.9 billion cardholders a quick and easy swipe into the web3.
2. On June 20, 2022, Shell, Accenture & Amex GT launched the first blockchain platform to track ‘sustainable aviation fuel’ (SAF) between companies and airlines after delivery to ensure there is no double-counting. Decentralized counting in motions.
3. On June 21, 2022, MoonPay launched a minting platform called HyperMint with three major entertainment brands – Universal Pictures, Fox Entertainment and Snoop Dogg’s Death Row Records. This will allow legacy brands to ensure intellectual properties that are stored away in closets by minting them into NFTs. The platform claims that it can mint hundreds of millions of NFTs a day. The question is, will there be that many mint-worthy NFTs after this winter?
These activities revealed at least three key takeaways for me:
1. It shows that these companies have planned their entry way before the crypto winter, and some have sustainable value into the future and some may not.
2. Regardless of the blizzards ahead, they still believe in what the Web3 technology can do for their business and the world.
3. Their business models that were kicked off months or even one or two years ago were based on the value and understanding of NFTs and blockchain at that time. Things have changed, and the market has become more educated. Will they pivot fast enough to make their investment count?
What I know for sure, this winter will teach us all how to be better prepared for the next one!
Also read:
- Why Are Investors Worried about “Crypto Winter”?
- Battling the Crypto Winter: How Investors Can Handle a Crash
- Why Crypto Markets Crash and 5 Ways Investors Can Deal
- How to Minimize Risks When Investing in Crypto
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