Why Now ?
Why should we start investing crypto startup now ?
Last updated
Why should we start investing crypto startup now ?
Last updated
Great startups always born in Bear market. After market passed bull season, people learning, market get matured, technologies is going forward.
Uniswap launched in 2018 in bear market. At that time, coincheck got hacked around 500M then everyone screaming securities problem of cex. Hayden adams launched the first model of AMM, which is automatically generate prices to depend on liquidity deposited on protocol, enables to trade smoothly any type of token asset without third parties,,, bring huge defi innovation happening 2020~2022.
But people tend to get crazy only when it only getting popular ! In bear market, investor can get better negotiation on startup investment, less competitive, good time to build up your business brand. Don’t be like others, invest in bear market, take profit in bull market.
Over the past years, we have seen the DeFi market boom, with the Total Value Locked (TVL) reaching over $200 Billion at its peak. This enormous growth has not only been seen in the Defi markets, but the crypto markets as a whole, with the Total Crypto Market Capitalisation reaching over $3 Trillion in 2021. Seeing this type of high growth trajectory has demonstrated that we are nearing complete mass adoption of blockchain technology and crypto.
According to Geoffrey Moore, there is a 5 phase technology lifecycle, which is followed by the most innovative and new technologies. First, you start with the innovators. These are the creators and enthusiasts who work to develop and create new technologies. Secondly, comes the early adopter. Early Adopters are investors who are willing to take more risks and have the intention of discovering new tech.
Due to the huge boom in the crypto markets, it seems as though the crypto market has passed both of these first stages and is currently in the “Big Scary Chasm”, as shown in the image below. The reason for this “chasm” is that the Early Majority (phase 3), requires the technology to be tested before they hop on.
After this pivotal point in the adoption cycle of new technology, we have the late majority and the laggards. Both of these come soon after the majority of the market has adopted the technology.
As mentioned, blockchain is now approaching this third stage of the adoption cycle which the market which will be the real test for the market. The way in which it connects with the Early Majority, will be pivotal for the market.
As with any new technology, blockchain and crypto adoption will need to adapt to the behaviors and needs of the mass markets. This means a development in sectors that will see the most be most popular with the masses. Much of the current innovation in the crypto markets over the past years, has been to develop decentralized protocols, which can take the place of traditional services.
As we enter this phase, the growth is similar to a snowball effect. The more that people adopt, the more media coverage we see, which in turn increases those who enter the market.
As we see adoption increase and begin to enter the late majority phase, the market has to show that crypto and blockchain are suitable solutions for the problems faced by traditional markets.
Some analysts even say that the blockchain is been adopted faster than the internet was in the early 2000s. Back then many knew that the internet would have a profound effect on the world, but it wasn’t certain and many still hadn’t joined the hype.
According to research, when the internet only had 150 million users, it was growing at 63% per year, at the time this was the fastest adoption of technology that history had ever seen. Blockchain has now usurped this accolade and as it stands, has around 150 million users. From inception, the yearly growth rate is 113%. If we apply this growth rate over the coming 2 years, we see that we will have over 1 Billion blockchain users by 2024! Not only this, but by 2030, we could be looking at over almost 4 Billion users.
This would have a huge impact on the total market capitalization of the crypto markets. Below is the historical adoption curve of BTC vs the internet in 1997:
NFTs have been around since 2014, but it wasn’t until 2021 that this novel technology broke through into the mainstream.
NFTs represent digital ownership of a wide range of one-of-a-kind items and have drawn the attention of celebrities and big companies ranging from American Express to Twitter and Meta.
The total NFT sales hit $25 billion in 2021, compared to $94.9 million the year before, according to DappRadar. However, according to the same source, NFT sales in June fell under $1 billion for the first time in 12 months, showing a slow in adoption.
Some experts expect the NFT market to continue to suffer because of the declining price of cryptocurrencies, along with other macroeconomic conditions like inflation, rising interest rates, and Russia’s war in Ukraine.
Looking forward we know that NFTs will be embedded in many aspects of our lives in the future. This means that there is a huge amount of innovation that is yet to come into the space and still a lot of adoption yet to take place over the coming years.
Mainstream companies across multiple industries took interest — and in some cases themselves invested in — cryptocurrency and blockchain in 2021.
Over the last year we have seen an increased number of large institutions utilising crypto, this shows that there has been a noticeable realisation of the power of the blockchain.
It is becoming more and more public knowledge, that the blockchain is a great way to process provision of goods and services to anyone connected to the public infrastructure, with high security and transparency in near future.
