Crypto: A Look at the Journey So Far and Where to From Here?

Here we take a glance at the crypto journey so far and the way forward.

15:09 18 January 2022

Back in January 2009, nine days after Satoshi Nakamoto published the famous whitepaper, the first lines of bitcoin code aka the genesis block was committed to the blockchain. It marked the birth of a community of passionate, tech-savvy individuals and backers who pinned their hopes on the blockchain technology to lead them to an alternate world, one in which digital transactions take place in a peer to peer environment without going through a financial institution like a bank.

 

The Early Days and the Journey So Far

In its early days, the crypto space was a microcosm of the Wild West: raw and unknown: one needed to have a deeper understanding of the space to traverse through it and not get swindled. The idea was revolutionary and the system powering it largely unestablished and untested. 

 

No surprises the crypto space had more doubters and detractors picking it apart. Eventually people warmed to the idea of investing in crypto and showed interest in experiencing first-hand what it meant to dabble in this world. More and more people wanted to be part of the expanding crypto community and several cryptocurrencies emerged amid rising criticism, leading to a rapid expansion of the space. Things took a turn for the better and crypto was reborn as a space that cannot be ignored.

 

And it marked the beginning of a long journey from the brink of relegation to mainstream, which culminated in 2021 when several cryptocurrencies went on to set fresh records in valuation and market cap. 

 

Strewn with challenges, the journey warranted a major overhaul of the way in which the crypto ecosystem was perceived. Thankfully, several resourceful people came forth with enterprising ideas and projects, offering a suite of solutions and use cases that would go on to radically transform the landscape and give it the impetus it needed to grow into a force to be reckoned with. That’s not all. They wanted to see how far they could take crypto in this transformative journey. They donned roles of influencers, of change agents, and of evangelists in order for crypto to mature into a better and bigger version of itself and for more people to get on board and explore the value and potential of the underlying blockchain technology. 

 

The Way Forward: Where to from here?

By 2021, which proved to be a game-changing year for crypto, the whole narrative had shifted. As things stand, we can comfortably say that the crypto industry has grown out of Bitcoin’s shadow and is all set to develop into a bigger entity with more new reforms happening/being proposed around blockchain technology, Web3 and more. Here we take a look at some key developments shaping up in this space.

 

More VC Money Flowing into Crypto Companies

2021 saw crypto turn into a different beast. And the venture capital firms took notice. 

 

More crypto-focussed businesses are now coming through into the system with unique capabilities, looking for funds to build on their offerings. And that makes a great match for VC firms looking to plough their money into hot and happening start-ups in this space. 

 

As confirmed by a Pitchbook study, VC activity has increased especially in the last few months where firms have been basically trying to outdo each other to fund burgeoning crypto firms with massive potential. Andreessen Horowitz launched a massive $2.2 billion crypto-focused venture capital fund in June 2021 only to be pipped by a crypto investment firm Paradigm which raised $2.5 billion to invest in brightest start-ups. 

 

Now Bahamas-based FTX, run by co-founder and CEO Sam Bankman-Fried, is the latest to hit the scene with a $2 billion kitty earmarked for crypto investments. 

 

Emergence of New Crypto-Linked Products 

Several digital coins may have popped out of nowhere lately and to reasonable success, but Bitcoin and Ethereum have been the real torchbearers of the crypto movement. Both digital currencies have played their own part at different phases making sure the foundation is set for a long journey ahead. 

 

The two-year long crypto uptrend has caused a flurry of retail activity and now financial institutions and blue-chip companies are also keen on following retail traders and investors into the crypto space. Even countries like El Salvador adopted bitcoin as legal tender thereby establishing a whole new trend which the experts think we’re likely to see more of in the years to come. And that’s not all. As the saying goes, ‘when it rains it pours.’ A long wait for a Bitcoin linked product came to an end as the ProShares Bitcoin strategy ETF (BITO) made its spectacular debut on the NYSE with much fanfare and adulation, paving way for similar products like Grayscale Bitcoin Trust (GBTC) etc to make their way into the crypto world. These products provide a great way for risk-averse investors to get involved in crypto without having a direct exposure to a particular cryptocurrency, like Bitcoin in this instance.

 

And with Ethereum pulling ahead of bitcoin in terms of YOY growth in value (over 400% as against 63% managed by Bitcoin), more similar Ethereum linked products are likely to come out in the near future.

 

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More Brick and Mortar Companies Diving In

Thanks to a bull run that spanned multiple years, cryptocurrencies hurtled into the financial mainstream in style. And now well-established brands like Walmart want to get their foot in, too. The retail giant is looking to set the ball rolling here by preparing to launch their own cryptocurrencies and collection of NFTs, which they reckon will help them better position themselves for exploring how they can provide memorable shopping experiences in the emerging metaverse realm.

 

It has been wild to see how far crypto has come and the big strides it has taken in recent years. As more companies and individuals enter the crypto scene with unbridled enthusiasm and fervor to make their own mark, the sign is clear that we’re just getting started and there is still a long way to go.