Asia crypto experts stay positive despite current bear market

Nov 20, 2018

*From left: TechNode editor-in-chief John Artman and panelists Patrick Dai, Jack Liu, and Edith Yeung. Image credit: TechCrunch 中国*

“One day in crypto is like a year in any other technology space.”

At TechCrunch 2018 this past Tuesday, 500 Startups partner Edith Yeung’s statement seemed fitting.

This time last year, Bitcoin’s value was close to $10,000. After the value peaked, however, it and other cryptocurrencies have seen a rocky slide south. As of Tuesday afternoon, Bitcoin had dropped below $4,500 and set a new low for this year. But panelists at TechCrunch’s blockchain side stage remained largely optimistic.

Jack Liu, Asia head of trading for crypto finance company Circle, pointed out that “not so quality products” created during the industry’s boom will be weeded out.

Yeung put it more bluntly: “many bullshit projects will die.”

*Edith Yeung of 500 Startups. Image credit: Bailey Hu/TechNode*

“Regulatory hurdles” have resulted in “friction for projects,” Liu said. But the cooldown also has to do with entrepreneurs realizing that “it’s actually hard to scale blockchain.”

Yeung agreed that “scalability is a hot topic” this year. So are security token offerings (STOs), which are subject to more government oversight in some countries and are thus seen as a less risky form of fundraising than initial coin offerings (ICOs).

Following market volatility, “stablecoins”—tied to relatively stable assets like gold or dollars—are also trending. Although as Yeung commented, given their less-innovative nature, “why would a venture capitalist invest in it?”

Patrick Dai, who founded the Singapore-based blockchain application platform Qtum Foundation, added that the industry needs more infrastructure before it can really grow. He compares the situation to trying to launch an app like Uber without a broad network of mobile phones already in use.

And despite its phenomenal growth in recent years, he pointed out that the blockchain field is still relatively niche. The industry needs to grow from 10 to 100 million users before it can mature, Dai said.

Liu said “mass adoption is almost a certainty” for blockchain. In the past few years, after all, crypto exchanges had grown from the tens to the hundreds. And the entire ecosystem has “only been around for five years.”

Given the pace of change, another two to five years may be all it takes for the world market to swing upwards again–and possibly undergo even more unforeseen landscape shifts.