Build Business: An outlook on the Web3 industry during the downtrend

In the current downturn in the cryptocurrency market, it`s essential to focus on the one thing that Blockchain technology has consistently suggested building.

At the end of May at the end of May, Bitcoin`s (BTC) value had fallen 40 percent, Ether (ETH) had lost 50 percent of its value, and the entire crypto market dipped below its $1-trillion total capitalization, for only the second time since the beginning of January. As we enter a clear bear market, it`s essential to focus on the one thing that the blockchain industry has always advised to develop.

Bitcoin, Ether and the broader crypto market`s downturn correlate to macroeconomic uncertainty. The uncertainty is driven by the rising interest rates, coupled with quantitative tightening that results in asset price sell-offs across the stock exchange as well as the crypto market. It`s possible that we`ll witness a similarity of events to the Terra ecosystem`s unraveling, the cryptocurrency lending service Celsius` fallout, as well as the hedge fund Three Arrows Capital`s $400-million liquidation losses.

2022`s market crash, 2018`s crypto winter

The crypto winter of 2018 was brought about by negative market sentiment and the loss of confidence. However, 2022`s crypto winter is the direct consequence of macroeconomics. Decentralized finance (DeFi) is falling equity prices are falling globally, and markets around the world are down. This bear market is not isolated to crypto alone, with leverage unwind simultaneously taking place across a variety of markets.

Private investors and venture capitalists invested a total of $30 billion into blockchain initiatives. A third of that amount went to gaming and virtual world projects in order to lay the foundations of the Web3 metaverse.

As we witness the exodus of people from Web2 project, I anticipate a growth increase of Web3 brands. There are several brands such as Yuga Labs, The Sandbox and RTFKT already partnering with major retailers, such as Adidas, Nike, HSBC, Warner Bros and others. Blockchain-powered decentralized apps (DApp) and DeFi have the potential to lead the Web3 evolution in the future and get control of a few gatekeepers who are centrally controlled.

This indicates that the transition to Web3 is coming and is depends on catalysts to grow. The crypto winter could certainly be considered a catalyst because it grants Web3 projects the opportunity to shut down, so that they can concentrate on scalability and sustainability.

Crypto winter is not a time to hibernate, but to continue building

During the 2018 crypto winter, we saw a notable increase in innovative projects, including OpenSea and Uniswap. Despite the decline those leading the blockchain industry are committed to developing and enhancing their products.

The projects took time to become successful. The year 2021 was the last time OpenSea produced $20 billion of nonfungible token (NFT) sales, and the Uniswap market grew rapidly, showcasing the potential of a decentralized financial system. Additional examples of DApps, DeFi, NFTs, DAO’s along with Web3 games are plentiful.

The key to expanding Web3`s Web3 community is utility

In the current winter of crypto and the coming crypto winter, there`s going to have more capital from venture investors to invest in new projects and they`ll not only survive but thrive when the next major surge comes around. This is the most important factor to survival — utility. Companies that provide utility are successful in the long run, while the ones that have a fundamental flaw, over-hyped and non-utilitarian end up failing. A crypto winter, therefore will separate the wheat from the shreds.

One of the most efficient ways for crypto projects, be it related to DeFi GameFi and NFT related, to transition to Web2 transitioning to Web3 is to look at the impact of housing process on-chain. In addition, accelerating the pace of growth by cutting costs is essential. Payment gateways charging inflated costs should be the first to be scrutinized, and it`s certainly worth it to consider a viable approach to the basic practice of making money.
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Payment solutions for crypto that permit cryptocurrency on- and off-ramps are helping Web3 companies grow faster because the solution allows transactions to happen off-chain, which means that the costs involved dramatically cheaper than standard payment methods. This also helps improve revenue and conversions, by allowing the users of a project to purchase and sell crypto at a competitive price within the project`s platform. Crypto platforms looking to streamline their payment infrastructure should consider the integration of onramps – and off-ramps.

The need for API-based solutions such as on-and off-ramp platforms is growing because they help companies settle various crypto and currency transactions, reducing the cost and risk of the counterparty thus empowering both the business and its customers. They also provide price transparency with leading exchange rates, with minimal spreads of conversion, so that customers are aware of what they`ll pay and exactly what they`re spending their money on.

In this ensuing winter and beyond, this is the kind of opportunity that we should be looking for: projects that offer ground-breaking and scalable infrastructure that will lead the next phase of the ecosystem of digital assets. Like always, the key to knowing when to be greedy when others are scared, and fearful when other people are greedy isn`t as easy as it may sound, but business platforms founded on solid foundations are solid over the long term and have a built-in resilience that will see them through both good and bad times like the digital currency winter we`re experiencing.

Read More: https://cointelegraph.com/news/

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