Expectations After the Crypto Crash
This year, cryptocurrency businesses dominated the main street at the World Economic Forum in Davos, a noticeable shift from the previous edition in 2020.
Even as the Bitcoin market fell, the industry’s high-profile presence was present. The collapse of the so-called algorithmic stablecoin terraced or UST, which saw its sister token luna plunge to $0 in May, triggered it.
Meanwhile, worldwide regulators are focusing on the bitcoin industry. The World Economic Forum (WEF) is an annual gathering of global business leaders and politicians; there, they’re trying to define the year’s plan. There are already over 19,000 cryptocurrencies in circulation and dozens more blockchain platforms.
Blockchain technology supports these digital currencies and platforms such as Ethereum, Solana, etc.
Many industry professionals believe that the current state of the market is unsustainable. Brad Garlinghouse, CEO of cross-border blockchain business Ripple, projected that there might only be “scores” of cryptocurrencies in the future. He stated that there are approximately 180 fiat currencies global; moreover, there is no genuine demand for so many cryptocurrencies.
In actuality, stablecoins such as tether or USD Coin, which aspire to be one-to-one mirrors of the US dollar, are backed by tangible assets such as currencies or bonds. They keep a reserve of these assets to keep the dollar-pegged. You may have also heard of the saga of a terraced or UST.
Believe it or not, the cryptocurrency sector welcomed the recent market crisis, which saw significant currencies like bitcoin plummet more than 50% from all-time highs. President Joe Biden of the United States signed an executive order in March; hence, the government had to investigate the risks and benefits of cryptocurrencies. There is no strict cryptocurrency regulation in the United States or other large economies.
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