Can innovation and extended development across the blockchain and Web 3 space spark a bull run for the crypto market?
Price has always been the main selling point for crypto over the last decade or so. Investors, venture capital (VC) firms and retail customers have fallen into the trap of chasing the latest trend in the market at the expense of looking for impactful prospects that will benefit their societies. The crypto price boom at the tail end of 2021, however, offered hope for investors, entrepreneurs, and analysts who looked forward to a revolutionary future influenced by this novel technology but it has been a rather pitiful market for the past couple of years.
The tales and debates surrounding blockchain technology and crypto have drastically changed, as seen in the massive shrinking of the total crypto market valuation during this period. Since November 2021, the total crypto market lost nearly $2 trillion in capitalization to stand at $1.13 trillion, as of writing, showing the dwindling interest in the space recently. NFTs, or non-fungible tokens, which consumed the attention of crypto and non-crypto consumers globally garner no massive interest today, the craze around decentralized finance (DeFi) gradually died, and even Elon Musk is not promoting Dogecoin anymore.
With speculation at its lowest and crypto valuations halved from ATHs, the crypto winter could present the perfect time for crypto projects to build, innovate and extend development as they await a possible bull run in the coming years.
The growing case for innovation in the blockchain industry
Proponents of blockchain technology boast of the extensive innovation happening in the field and the novel platforms that have arisen due to this technology. Nonetheless, the space has witnessed little to no innovation recently – Bitcoin Ordinals being the last major innovation I can think of across the top blockchain projects.
A big reason for this could be the long bear market which discourages developers from innovating, the lack of capital inflows from VCs, or the rise of newer, more promising technologies such as AI.
Regardless, smaller projects (below the Top 100 coins) have kept developing new platforms and innovating, building a strong foundation for their projects despite the bloody market. For instance, little known project, Metatime has built an ecosystem with many innovative financial solutions and investment opportunities such as MetaRealEstate and MetaMovie, which decentralizes real estate and movie production, giving anyone a chance to raise funds for pieces of land or movie titles. Banksters, a play-to-earn NFT platform, brings gaming to crypto trading. Artifi is revolutionizing the trillion-dollar art market by decentralizing and fractionalizing ownership of expensive artworks and many more.
While innovation may be slowing down across the already established chains, several projects are still building revolutionary solutions that add value to the overall economy. This is the reality many developers have had to face – build innovative products to get high valuations of their projects.
An innovative ecosystem pushes for value growth
In a pool of tens of thousands of crypto projects, it could be hard to spot the highly innovative projects, especially if the market value does not reflect the innovations. Metatime, for instance, is building a holistic blockchain ecosystem to advance decentralized finance and fractional ownership of assets. First, the MetaAnthill feature provides a hybrid system for its blockchain allowing the system to optimize workload allocation and efficiency. Additionally, the ‘anthill’ synchronizes mining nodes at high speed and uses the resources of the platform’s independent hardware in the most efficient way.
The primary objective of the team is to launch 70 products in the next five years, in hope that interest in crypto will return to its previous highs. Other revolutionary innovations by the team include its Meta Launchpad, for non-crypto users who wish to launch their blockchain-based projects; MetaNFT, a marketplace that evolves the NFT buying and selling allowing users to generate, split, hire or rent out their NFTs; and as explained before, MetaRealEstate and MetaMovie.
As the saying goes, “innovation is the unrelenting drive to break the status quo and develop anew where few have dared to go”, and these smaller blockchain projects are leading the way. Despite its small stature and valuation in the crypto space, the launch of Metacoin in November could prove a turning point for the project. The driving force for crypto projects in the bull market has always been speculation and trend-chasing, but with innovations being built during this crypto winter, the industry could be switching to a less speculative market, rewarding those who innovate more.
However, one barrier to this innovation is regulation, which has provided the largest hurdle for most crypto projects.
Can innovation turn regulators’ and governments’ heads?
Despite the relentlessness of developers and innovators in the space, anti-innovation regulation poses a big challenge to the growth of their platforms. The chain of events that started with the overnight collapse of the algorithmic stablecoin TerraUSD and its companion token LUNA, and the bankruptcy of Three Arrows Capital, Celsius, Voyager and FTX, governments around the world have become more wary of cryptocurrencies.
However, tough rules against crypto will only stifle technological innovation. Innovation rarely happens in a boardroom and often requires an independent streak that doesn’t play nice with the status quo. While regulations are welcome, regulators should look to work with innovators to set rules that are tough but flexible to ensure the end consumer is protected but also gets improved outcomes.
Finally, governments should work on developing and enforcing a framework that will allow regulators to move as fast as the crypto market itself. Instead of totally banning the technology, the regulators can work to set up laws that enhance “good” innovation and scare away bad actors.
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