Fascinating technology

Cryptocurrencies are dying but long live blockchain technology

Before I get accused of being an alarmist, crypto is not doomed. Rumors of a crypto-armageddon are greatly exaggerated. The provocative headline is taken from a cheeky advertisement that Coinbase, the world’s largest crypto company, ran earlier this year at the US Super Bowl, proclaiming “Crypto is dead, long live crypto.” Little did they know that a few weeks later they and other crypto companies would be fighting for their lives as they fired their employees and withdrew offer letters. The crypto market fell to a third of its peak value and some major players halted bitcoin withdrawals as an emergency liquidity measure. These crashes brought out the Doubters in full force. Tech pundits who had heralded the rise of crypto, blockchain, and web3 as the second coming began to whisper about their impending death.In my view, crypto is not dead, nor does it portend the eclipse of technology behind it, blockchain.

Before we explain why blockchain is as strong as ever, let’s briefly turn to the smashing house of crypto. Many experts attribute this crash to global geopolitical and economic conditions: bitter warfare, supply chain and labor disruptions, and runaway inflation. However, what baffles people here is that these are exactly the kind of disruptions against which crypto, especially Bitcoin, was meant to act as a hedge. Like gold, Bitcoin was what you bought when real-world countries and economies struggled. Theoretically, Bitcoin and crypto should have risen, or at least remained largely stable. What is interesting is that the great crash did not start because of economic or political uncertainty, but because of another real financial phenomenon: the presence of fraudsters and peddlers. Terra Luna, a so-called stablecoin that held 3% of the total market, turned out to be built on a foundation of hype and crashed dramatically to zero. This sparked a crisis of confidence in the crypto world, and an economic upheaval has only fueled this fire.

This kind of thing is not new. In 2000, an Internet bubble burst resoundingly, with popular companies going bankrupt, taking the entire Internet industry with them. But those companies weren’t the Internet. Not only have online businesses survived, they now dominate the world as social networks, while mapping platforms, e-commerce and mobile payments rule our economies and our lives. As Maria Bustillos said in The New York Times, “Crypto is just one aspect of the larger blockchain universe…and its skeptics and fans must learn to see it as a technological experiment. , instead of just a blatant scam or a speculative route to Eight years later, the big banks have collapsed under the weight of exotic mathematical instruments like debt-backed bonds (CDOs), dreamed up by bankers living in their own parallel world. The crash of 2008 was estimated to be around $10 trillion; the current crypto crash is a fifth of that. After this bloodbath, many banks did not survive, but the bank did. So will crypto and blockchain. There were almost 20,000 cryptocurrencies and only a few of them will (and deserve to be “The Market for cryptography is extremely volatile, not because of technology underlying ogy of cryptocurrency,” says Bustillo, “but because of the difficult and often dangerously unstable junction between emerging technologies and ordinary money.”

While arc lamps focus on Bitcoin and crypto, Blockchain has worked to solve problems in the less glamorous world of supply chains, financial services, big business and energy. It is leveraged to unravel complex supply chains by shippers and retailers. Blockchain-based solutions can make remittances less burdensome and costly for mobile workers who need to send money home. Blockchain experiments to authenticate educational and other qualifications, making them less cumbersome to store and share, can make student loans more affordable. Blockchain-based energy networks attempt to provide cheap energy to underserved areas. Governments are testing the technology of secure identity systems. Tamper-proof and anti-fraud transaction records can be enabled. The decentralized nature of blockchains is leveraged for distributed business models like Helium, “people’s Wi-Fi” that is not owned by any telecommunications company but is shared collectively. Blockchains strive to reward online art and creativity with NFTs, while powering parallel worlds (if unproven) like the metaverse and laying the foundation for a “conventional economy”. creators”.

The crypto world has been rocked and some of its biggest structures seem to be collapsing. But it’s not the end of the world, just the tectonic plates of its infrastructure slipping and sliding as they attempt to release creative energies. Blockchain and crypto live.

Jaspreet Bindra is the founder of Tech Whisperer Ltd, a digital transformation and technology consultancy

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