Although the predictions say otherwise, the bear market in the crypto industry is still in full swing. But some cryptocurrency firms are quickly building more infrastructure because according to them, this is the best time for projects to show their real potential.
Prices for the major cryptocurrencies have plummeted by almost 80 to 90 per cent from their peak prices in 2017, and although they rose somewhat by the end of 2018 and the beginning of 2019, it is not enough according to most. The total market cap has also dropped by almost $700 billion.
However, while several firms have been forced to shut down or merge with larger companies due to losses incurred during the bear phase, many firms have been very productive during the same time – especially the ones that have been building infrastructure, along with the firms that are looking to pick up equity in projects that dropped quite considerably.
A good example is Blockdaemon, a firm that creates and hosts computer nodes. According to Konstantin Richter, the Chief Executive Officer at the firm, this has been “the most productive phase we’ve ever been in.” Mr Richter talked about the subject in a recent panel discussion with Bloomberg News:
“Projects now need to show their colours. The time is up of raising a lot of money and talking a lot of talks.”
Bitcoin’s price fell by 81 per cent from its peak price in 2017 when the bubble burst, starting the bear phase for the cryptocurrency market; XRP and Ethereum’s price similarly fell by more than 90 and 91 per cent respectively. As the top 3 cryptocurrencies crashed hard, many investors lost faith in Blockchain technology and its potential uses.
Adam Jiwan, the CEO of Spring Labs said,
“The skepticism is warranted in many ways because this technology is nascent and untested at an industrial scale…Our hope is this presents us with a great opportunity to recruit talent.”
The co-founder and principal advisor at Maco.la, Sheri Kaiserman, believed that building infrastructure was a better way of making equity investments than buying initial coin offerings (ICOs). She added,
“We felt like the best way to make money is to buy the infrastructure companies — the picks and shovels — that are helping build the foundation. They are coming down in valuation, which is the best part of the crypto winter for us.”