Last year, $ 7 billion was tracked in the ICOs. In combination with 2018, the cryptocurrency-based financing mechanism has an estimated value of $ 20 billion. ICOs threatened to extend venture capital broadly across the board, but the signals suggest that an investment status quo is returning with VC capital a once again preferable option.
We have seen this with some recent investments – particularly those for Binance, Kucoin and Imtoken – but more fully a relative "norm" is close to being reached, two cryptic experts told an audience at the TechCrunch Disrupt in Berlin today in a conversation with Mike Butcher from TechCrunch.
The winter crypt is here. Crypto companies are firing personnel to reduce costs. The market is moving south in terms of financing, but it is not bad at all.
These moves will bring stability and legality, according to Vinay Gupta – one of the developers who contributed to the birth of Ethereum, currently CEO of the Mattereum tokenisation product.
The mania of alcohol "it started to turn down once it was easier to do that kind of thing on Ethereum because you did not have to run your decentralized network, you could just write and script Ethereum, and then you can run it on smart contract, "Gupta said on stage in Berlin .
"Some of these projects are very successful, some not, but they all had to be properly regulated securities right from the start, because they were raising funds directly to the general public, governments did not go away, the Internet does not exist in a separate dimension. , there will always be an agreement with regulators and what will come out as an economy thrown correctly adjusted next year, the SEC will define these things are not going well.
"Regulated exchanges will come [and] everything will straighten up. But at that point it will be much closer to ordinary finance than to the kind of original wild west blockchain, "he said.
In fact, security token platforms – which use the blockchain to host US-like non-regulated stock holdings – are on the rise, with some predicting that digital security tokens will hit trade potentially before the end of quest & # 39; year. And within the legal rules.
If ever, regular risk capital re-emerges within the cryptic industry.
"It depends on the projects you're talking about," commented Jamie Burke, the second member of the group, "Outlier Ventures".
"If you talk about protocol and infrastructure, the great innovation we have, I think it will stay with us is the idea that you can be open source, and it can be tokenised, and this gives it very powerful network effects. they should definitely have tokens.
"The point is who should participate in funding that network and who should participate in the creation of economic value and at what stage? So I think we will start to see the hybrids Initially the projects will raise money through equity (the most risky part ) until they have achieved broader adoption and will need this to incentivize the network and various behaviors, "said Burke.
Gupta – who is planning to raise money for Mattereum – said that there is still much of an important role for "traditional" VCs as part of building a blockchain space society.
"Traditional venture money is important because [VCs] put a lot of skill on the table. The kind of downsizing challenges we expect to see in the next year or so are much more similar to the kind of things you see in traditional venture because some parts of what we do are very competent by jurisdiction. It's not just you raise the net and go, "he said.
Done! So venture capital is still an important part of the process, despite the past examples of companies that have raised tens of millions of dollars through token sales.
In fact, Gupta believes that the tokenisation of assets – its recently "downsized" startup, a $ 10 billion Stradivari violin – will allow smaller investors, the kind they might have bought in ICO, to spread their capital more widely without incurring huge amounts of risk.
"The ability to buy some 10,000,000 resources is the kind of thing you can now do only on a large scale, but it gives a kind of stability to your investments that makes ordinary investors more able to get the kind of stability of the yield you get with pension funds, "he explained.
"I think there is a good chance that this will be positive for retail investors, once the markets have stabilized in unreasonable exaggeration, it is burned."
You can look at the complete panel below.