3 Good Reasons Why Investors Should be Optimistic About the Future of Crypto
The digital currency ecosystem that was once presented as a mystical industry is now one that is being widely spoken about in the media, and everyone is jostling to take a bite of it.
Realistically, the cryptocurrency industry has grown remarkably since Bitcoin (BTC) was first introduced by Satoshi Nakamoto more than 13 years ago.
The industry has passed through unique iterations and evolution, some of which have attracted new users into the ecosystem.
While it will be a major oversight if we fail to highlight how the interest of regulators in the ecosystem has peaked over the past few years, it is definitely worth noting that innovators in the space are introducing new solutions that are not fitting into the current context of extant laws.
This is to show that the industry’s evolution, as presented by proponents, is still in its infancy, irrespective of the milestones that have been covered. Despite the industry taking significant hits by reason of the crypto winter which has led to bouts of bankruptcies, job cuts, and top executive resignations, the market still shows resilience, one that sends new signals for futuristic investors to hinge their bets on.
Amidst the ups and downs the market has experienced in recent times, here are the top three reasons to stay positive as the market journeys onto more maturity.
The influx of Institutional Money
The influx of institutional money has shown how well the industry is maturing. With Venture Capital (VC) firms showing interest in protocols building innovative solutions in the ecosystem with deep capital injections, innovators can be sure that the monetary backing is there to churn out solutions that can help drive massive adoption of blockchain and crypto-related technologies.
The major VCs injecting liquidity into the space include but are not limited to Andreessen Horowitz (a16z), Paradigm Capital, Binance Labs, and Tiger Global.
Ongoing Industry Metamorphosis
As it stands, the crypto and blockchain industry is undergoing a very unique metamorphosis as it concerns how innovators are churning out new solutions.
It is worth noting that the industry is still shaping up, and while the world is yet to get the best of Decentralized Finance (DeFi) as a primary financial offshoot of the ecosystem, we have seen the advent of Non-Fungible Tokens (NFT) and the broad-based marketplace and use cases that have been ushered in by it.
At this pace, we may see the introduction of more yet-to-be-seen protocols, most of which will be branded as a subsect of the Metaverse or Web3.0. The thought that more innovations that can make internet usage and life easier are major selling points for investors.
Automated Industry Self-Purge
While this may be counter-intuitive, the advent of crypto winters is good for the industry as it helps fish out companies whose business models are hinged on unsustainable practices or bad management.
Since its inception, the crypto industry has undergone a series of crypto winters and at each point, protocols and platforms whose ideals are not consistent with what can make the industry thrive are dropped, and they pave the way for the most resilient protocols to serve users.
For investors, knowing the ecosystem has a way of fishing out the bad projects is a certainty that investments in protocols that survives the crypto winters can turn a massive bet in the near future.
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