A $1.4 trillion sweep hits the crypto industry at the World Economic Forum

Along Davos Park in 2023, there are fewer crypto companies than in previous years after the market crash. Circle, the company behind the USDC stablecoin, was one of the few existing ones.

Arjun Kharpal | CNBC

Davos, Switzerland – Over the past few years at the World Economic Forum in Davos, Switzerland, the number of attendees in the cryptocurrency industry has boomed.

But after wiping out nearly $1.4 trillion in 2022, the cryptocurrency industry has become more conservative about how it splashes money, and many of the companies spotted last year didn’t turn up. The year 2022 was marked by failed crypto projects, liquidity issues, and bankruptcies, topped by the collapse of the major FTX exchange.

When the World Economic Forum convened last May, bitcoin It was hovering around $30,000, having already fallen more than 50% from its all-time high in November 2021. More pain followed as bitcoin fell to $15,480.

The Promenade is Davos’ main street where businesses and governments take over shops and cafés all week long. In the past year, crypto companies from all walks of life took the place. But since the market crashed, there are far fewer crypto companies with flashy storefronts in Davos.

A store selling non-fungible tokens, or NFTs, has disappeared. Prices for NFTs, which are digital collectibles, also fell last year. What is left are the companies that survived the bear market and are looking to expand their business.

said Tina Baker-Taylor, vice president of policy and regulatory strategy at Circle, the company behind the USDC stablecoin.

See also  In court battle with Twitter, Elon Musk points to the Indian government

A stablecoin is a type of digital currency that is supposed to be pegged together with a fiat currency. USDC is pegged to the US dollar. Circle says it is backed by real assets such as US Treasurys so that one USDC can be redeemed for $1.

Casper Labs, a company that builds blockchains designed for use by businesses, operates a space on the Promenade called the Blockchain Lab. Casper Labs was also present last year in Davos.

Cliff Sarkin, Casper Labs’ head of strategic relations, said he was “cautiously optimistic” that the cryptocurrency market had bottomed out.

“We’ve been in over a year into the bear market, so I think the shock of that has worked out and for those of us who’ve been in the space for years…we feel like this is the right time to build,” Sarkin said. CNBC.

He added that the crypto companies remaining in Davos are “substantial projects” and “real bargains” for things like NFTs.

There were also those in traditional finance who welcomed fewer crypto companies.

Mark Heffel, chief investment officer at UBS Global Wealth Management, was asked during an event hosted by the Swiss bank what he would like to see in Davos this year. He said he had seen it already: “It’s the cheapest cryptocurrency on Main Street.”

The Mysterious Case of the Orange Bitcoin Car

On Monday, a bright orange Mercedes-Benz was parked outside the Blockchain Hub in the park.

The orange Mercedes was parked along the promenade in Davos. No one around saw who stopped her there. The license plate reads “Kuna,” which is the name of the Ukrainian cryptocurrency exchange.

Arjun Kharpal | CNBC

A coin representing bitcoin has been placed where the Mercedes-Benz logo would normally be. On the tires and license plate, the words “We Trust Cryptocurrency” are printed. On the license plate was the Ukrainian flag and the name of Kuna, the company behind the cryptocurrency exchange of the same name.

Kuna also set up a “Reserve Fund for Ukraine” after the war with Russia started where people can donate cryptocurrency to Ukraine.

People in the vicinity that CNBC spoke with couldn’t verify who parked there.

However, two cryptocurrency executives who spoke to CNBC did not welcome the orange car, especially after the market crash and excesses in the industry were exposed. Someone remarked that having such a car wasn’t good for the reputation of the industry, which had been damaged in the past year.

CNBC has reached out to Semen Kaploushenko, CEO of Kuna Stock Exchange, via LinkedIn, but has not yet received a response.

CNBC has also reached out to the Blockchain Association of Ukraine headed by Kuna founder Michael Chobanian, but has not yet received a response.

The license plate and tires had “We Trust Cryptocurrency” printed on it.

CNBC | Arjun Kharpal

Leave a Reply

Your email address will not be published. Required fields are marked *