Jan 11, 2023 04:15
For those of us who have been around awhile, it takes more than another bear market to change our long term expectations for cryptocurrencies.
I've been through three crashes - the first one really had me questioning things, the second time I was more willing to ride it out, 'hopeful but not certain' was my outlook on crypto's future. In both cases the crashes were followed by hitting new all time highs, and this pattern wasn't new, it's what Bitcoin historically had always done, and more recently, the top altcoins were included as well.
So, this time around I feel like I'm just waiting... for our largest bull run yet. Not wondering if it's coming - waiting for it to get here.
Some of the Biggest Names in Investing and Wall Street are Quietly Preparing for a Crypto Boom...
Thankfully, it looks like I'm not the only one making this prediction. In fact, the biggest firms from the world of investing and Wall Street seem to be anticipating this too.
Keep in mind, the firms I'm about to mention don't throw millions at something because one or two executives believe it will pay off - before they invest, teams of analysts with specialists covering multiple aspects, and algorithms pumping out multiple models of possible outcomes, are involved.
Let's look at some of what is happening quietly behind the scenes right now - and ask yourself: does it seem like they see something coming?
Major Investment Firms:
Between just these 2 firms you're looking at over $2 TRILLION in assets under management, twice the size of the entire crypto market currently.
? The world's largest global investment banking and investment management firm, Goldman Sachs, is quietly talking to multiple crypto startups that were hit hard by the bear market and investing to become part-owners of, or buying them out completely.? The second largest global investment banking and investment management firm, Morgan Stanley, is currently creating their "digital-asset infrastructure," giving their 2 million+ clients access to the crypto market. While development started before the bear market hit, they say it never slowed down as they remain "focused on building."When these firms enter a sector, countless smaller ones follow.
Payment Processors:
The big 3 are all in.
? Visa is "propelling innovation to deliver even more access and value to the crypto ecosystem" and recently filed a series of trademark applications for crypto wallets, NFTs, and metaverse-related products.
? Mastercard is launching a program to enable mainstream banks to offer crypto trading to their customers.
? Even American Express, which in 2021 said they were "watching the space evolve" but had "no plans to announce" involvement in cryptocurrencies, began preparing for something, specifics still unknown, but real enough to have them file eight trademark applications for tech processing crypto and NFT transactions.In addition to this, both Visa and Mastercard will expand their current role of providing cards that allow people to spend crypto anywhere that accepts their credit cards. This has become a standard offering from most major exchanges now, and accounts for over $1 billion in transactions for Visa alone.
Start-Ups:
When it comes to startups, those that truly serve a purpose are not struggling to find funding. Here are some of the projects that held investment rounds over just the last month - all hit their targets:
? Aztec Network, an Ethereum security layer geared towards privacy, successful raised $100 million in a round led by prominent venture capital firm Andreessen Horowitz (a16z), with participation from A Capital, King River, and Variant, and others.
? Singapore-based crypto firm Amber Group closed a $300 million Series C led by Fenbushi Capital US. Nillion, a decentralized file storage network, raised $20 million in its latest funding round led by Distributed Global.
? Fleek, a developer platform for crypto companies, secured $25 million led by Polychain Capital, along with Coinbase Ventures, Digital Currency Group, and Protocol Labs.
? Tax and accounting software for digital assets, Bitwave, closed a $15 million Series A co-led by Hack VC and Blockchain Capital.
? Blocknative, a company building web3 infrastructure, also secured $15 million in its Series A led by Blockchain Capital and a few other investors.There's only one reason any firm would be investing in new companies that could still be years away from seeing profits - again, the long term outlook.
The Path from Here, to There...
The road from bear to bull market is surprisingly short and straight - plus, following the collapse of FTX, a come-back for crypto also means washing off some of the mud currently splattered on crypto's public image. But all of this is doable, here's how it will go;
Crypto regulations are coming, discussing if you're for or against this is officially a waste of time - we're getting them.
However, the industry has gotten smarter over the last few years and regulations no longer mean a 'crack down' on crypto.
As politicians began considering passing finance laws specific to crypto assets, the crypto industry became major Washington DC influencers, and almost overnight began supporting pro-crypto politicians campaigns at such large amounts that crypto is outspending the industries that have typically spent the most for decades, the defense industry and pharmaceutical companies.
Until recently we were truly were at risk of tech-illiterate politicians passing poorly-written regulations that could bring everything to a halt, that no longer longer seems possible. This level of involvement has given the industry a place at the table with lawmakers.
If you're outside of the US thinking this doesn't involve you, I wouldn't count on that. Some regulations will address the situation FTX is in, requiring exchanges to prove the assets they hold and auditing their total value regularly. It wouldn't surprise me if US companies and investors could only do business with foreign firms that follow similar guidelines - setting a standard that will quickly become global.
Over the span of just a few days: Crypto's current public image gets fixed as politicians pat themselves on the back for 'fixing crypto' with 'new investor protections'. The largest investment firms have citied the lack of these regulations as the only reason they haven't yet gotten involved - so now the floodgates open.
I believe the next bull market doesn't just set new all-time highs for the top cryptocurrencies, but does it at record speed as well - Bitcoin gaining $10,000 per week for 5 weeks would get us past it's previous high, and it wouldn't surprise me if that's how it went.
Remember - there's never been so many people and companies aware of what a Bitcoin bull run can do, and it will be a lot harder to justify sitting it out.
In Closing...
There's nothing fun about a bear market, except looking forward to it ending. Based on current indicators, it seems we may have a lot to look forward to!
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Author: Ross Davis
Silicon Valley Newsroom
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