The crypto market is evolving and embracing regulation and practical technology over flashiness and NFT craze. Stay updated on the latest developments in the industry with our in-depth article on crypto regulation.
Crypto is not dead, it’s just growing up and crypto needs regulations. At Messari Mainnet in New York City, I spent three days rubbing shoulders with crypto founders, blockchain pros, politicians, and executives.
Most of the 3,000 attendees were buttoned-up professionals representing companies or brands, unlike previous years when it was full of tech bros and Reddit enthusiasts.
When I attended the same conference last September — when the events were more attended and tickets were more expensive — many of the conversations I had were about speculative bets, NFTs, and the metaverse. I couldn’t keep up with inbound interview requests, happy hours, and party invites. I even secured a ticket to a networking event aboard a yacht – an opulence that was absent from this year’s event.
In spite of crypto’s recovery from the brutal bear market of 2022, prices are still far below their peak, and some markets, such as NFTs, are even worse – a recent report estimated that 95% of the digital collectibles were worthless.
A number of attendees told me this week that they found last year’s conference buzzier, more lively, and more fun – though not necessarily more productive for the remaining industry players.
Perhaps a more boring scene is a good thing.
The CEO of Securitize, Carlos Domingo, told me there is less hype, speculation, costumes, and boat parties, and more serious discussion about opening up real-world assets like private equity, private credit, fixed income, and other alternatives to investors. While everyone focused on the hype for the past few years, this work went on without notice.”
Get-rich-quick schemes are over-crypto regulation
There’s no shortage of snake-oil salesmen when money is easy and liquidity is high.
In a bear market, however, half-baked projects and obscure alt-coins are harder to stomach.
Skybridge Capital founder Anthony Scaramucci, a Wall Street bigwig and former White House communications chief, was the only speaker to give an investment outlook at Messari this week.
Panels discussed topics like “Crypto Tax and Accounting,” “What’s the SEC’s End Game for DeFi?” and “How to Make Crypto Actually Useful.”.
As part of a press breakfast hosted by Coinbase, executives demonstrated how to pay for coffee with crypto, and unveiled a new messaging feature that streamlines peer-to-peer transactions.
The thing that will encourage skeptics is crypto as a technology, and moving away from crypto as an asset and speculation,” said Jesse Pollak, the creator of Base, Coinbase’s layer 2 Ethereum blockchain. It’s more about how crypto helps small businesses, restaurants, advocacy groups. It’s not another get-rich-quick scheme, it’s about how it helps people.
There are more products and startups with real-world applications in crypto, he told me Thursday. Bear market or not, crypto is entering a new era.
According to Jess Houlgrave, the chief operating officer of WalletConnect, the conference was quieter than last year, but higher quality.
“Events continue to happen in a downturn, but they’re smaller, more curated events rather than splashy parties,” Houlgrave said.
In conversations, the notion of “invisible technology” kept coming up. Crypto applications will gain mainstream acceptance once people become unaware of their existence.
According to Houlgrave, there are fewer gimmicky things because the industry is maturing. Since crypto will never be consumer-facing anyway, the business-to-business focus we’re in right now is here to stay. Consumers will eventually be interacting with blockchain every day without realizing it.”
Attendees said crypto’s biggest challenge is not price action or investing in the next winning project, but keeping innovating under increasingly tough US crypto regulation.
Gary Gensler’s long shadow
No one stopped talking about Gary Gensler, the chairman of the Securities and Exchange Commission, who Scaramucci compared to Jiminy Cricket and Vivek Ramaswamy called out as a government redundancy.
Ramaswamy said in a fireside chat that Gensler has “a bunch of people showing up to work who shouldn’t have a job in the first place.”
Attendees said their main issue with Gensler is his inability to articulate clear guidelines for cryptocurrencies. He most recently lost a fight with Grayscale after the SEC rejected its bitcoin ETF proposal.
According to Ramaswamy, Gensler cannot say whether ethereum is a security or not. “Tomorrow, will a bank deposit be a security? A US dollar? You have an agency that obfuscates.”
The lack of clarity is what cripples innovation particularly in the US, Coinbase’s Pollak told me, and it’s keeping skeptics on the sidelines while capping potential on those already in the industry. Crypto companies are looking to grow and make an impact in Singapore, Hong Kong, and other European countries.
“We need a clear policy framework so people can innovate,” Pollak said. “Innovators are moving outside the US to regions that are being more proactive in terms of policy.” for crypto regulation.
A few days before Messari Mainnet, the Singapore conference Token 2049 happened. Asia’s crypto scene, it seems, has no shortage of festivities and hype.
It’s not necessarily a bad thing for me to find Messari Mainnet less fast-paced or fun this year. It just shows how priorities have changed over time.
The industry is maturing, and the adults are taking the lead-crypto regulation
There is so much noise and distraction in a bull market that no real building gets done,” Pollak said. “The people showing up at Mainnet now are those who are working hard to build awesome products.