Crypto Adoption: Back to Basics

As if the bear market of 2022 wasn’t bad enough, the epic FTX collapse and subsequent arrest of SBF came along to ruin everyone’s day.

Was this the beginning of the end for crypto?

Or is it, just possibly, the end of the beginning, with a new phase of crypto adoption ahead?

The cryptocurrency sector is down, but not out – and there’s a growing consensus that the bear market is only separating the good projects from the bad ones.

That’s bad news for investors in those projects, but good news in the push to bring more users into the crypto space.

Building a Better Crypto Economy

What’s the most important thing about the crypto revolution?

It isn’t a particular crypto exchange, or the success of a single token – not even Bitcoin.

It’s the technology that underlies all exchanges, altcoins, and protocols. Blockchain makes all of it possible – and the fundamental technology isn’t going anywhere.

The cryptocurrency market is maturing. That might be the most exciting aspect of the ongoing downturn. Ethereum continues to upgrade and Bitcoin ordinals have taken NFTs beyond the Ethereum ecosystem. 

In short, we’re past the initial rush. The tech isn’t radically new anymore, although it is still radical; and the crypto industry has begun to flesh out what crypto, web 3, and blockchain can and can’t do.

Here at Plexus, we see evidence of this growth all around us. Just look at the surging demand for experienced developers in different languages. Here are Rust dev salaries:

*Salaries reflect potential earning. These will vary for each level, depending on experience.

And here’s what Solidity devs are charging these days:

*Salaries reflect potential earning. These will vary for each level, depending on experience.

And it isn’t just us. Voices as significant as Vitalik Buterin are calling for a focus on the success of the underlying tech, rather than the collapse of standalone projects.

In the bull market, promotion was king, with individual projects succeeding or failing based solely on marketing and buzz. Success in a bear market requires a solid foundation – and that’s why developer salaries remain high.

What can blockchain do for you?

As 2023 progresses, we’re back to the age-old question: what’s the use case for blockchain technology?

Forget the Ponzi schemes and endless scams; what are people actually doing with the technology? What innovations are next?

When the crypto meltdown hit, the novelty lost its luster. All those new innovations seemed like poor excuses for lasting success. Plus, the crypto camp itself split into different factions. Some called for more regulation, others for an increased push for decentralization.

Buterin calls for people to stop focusing on trading as the end goal for crypto protocols. Instead, to spur cryptocurrency adoption we should start paying attention to the nuts and bolts of crypto.

Along the same lines, Aave founder Kulechov also advises we look into non-financial blockchain use cases. Fresh ideas not focused on revenues help industry enthusiasts combat crypto winter blues. For savvy investors, it’s a potential way to deal with the downturn.

Focus on higher quality

At the beginning of the year, a CoinDesk article nailed it:

The downfall of crypto had very little to do with crypto.

The problem with the crypto space isn’t the tech itself – it’s the poor, shoddy, and occasionally outright illegal applications of that tech.

The biggest use case of crypto assets seemed to focus on “make tons of money however possible.” Do Kwon, SBF, and others took advantage; now, the public associates crypto ownership with a sort of unsavoury, robber-baron type. The entire industry suffered – but can trust be regained?

Coming out of the crypto winter, there’s a real chance to build something better, by focusing on valuable use cases and reliable projects. We’ve created a guide on how to find those projects – you can check it out here.

In the meantime, the bear market will continue to sort out the losers from potential winners.

Signs of adoption?

One of the basic tenets of crypto is that it needs widespread adoption to succeed long-term. Certainly, some of the ideas of the crypto revolution have already gone mainstream; the idea of digital assets as an asset class is just one example. But we haven’t seen widespread adoption of cryptocurrency from the everyday man on the street.

Large-scale institutional investors are a different matter. A recent Coinbase report showed that among major institutions:

More than half—52%—of the Fortune 100 have pursued crypto, blockchain or web3 initiatives since the start of 2020, according to the enclosed research conducted in partnership with The Block. About 60% of Fortune 100 initiatives reported since the start of 2022 have been either in the pre-launch stage or already launched. Zooming out, 83% of surveyed Fortune 500 executives who are familiar with cryptocurrency or blockchain say their companies have either current initiatives or are planning them.

We’ve talked before about the growing ties between DeFi and TradFi, and how crypto protocols are increasingly following the example of traditional institutional investment.

What we’re seeing isn’t revolutionary, but the adoption often wished-for by crypto enthusiasts might be happening in a slightly different way, with crypto spurring adoption by applying radical new tech in traditional ways.

Crypto’s getting back to basics, and that’s a good thing for broader adoption.

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