Ethereum blockchain co-founder and prominent leader in cryptocurrency Vitalik Buterin said that investors might be experiencing a “crypto winter,” but it’s not all bad news for them. He went on to say this could lead up into another digital asset universe as prices are currently low enough, which would give opportunities with significant gains potential when things pick back up again like before.
In an interview with Bloomberg, Buterin said;
A lot of people who are deep into crypto and especially make things welcome the bear market. They welcome the bear market because when prices go up so much in the long run – it’s obviously a lot of people rejoice – but it invites a very short period of time. Speculative attention.
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The cryptocurrency market took a plunge after reaching an all-time high in early November. Owing to investors’ and speculators’ expectations of positive economic news coming out of Covid. As a result, the Bloomberg Galaxy Crypto Index fell about 45% from its peak, with Ether declining by 40%.
With the recent rise in prices, many people have seen their assets increase exponentially. CoinGecko is tracking 12,588 different tokens and reminds us all that this isn’t just a bull market. It’s been one for cryptocurrency as well. However, fraud and manipulation in this market can hurt you if used incorrectly or blindly follow leaders like sheep. And to get a rich quick scheme without understanding what they are getting into.
Pumps & Dumps occur when traders try to gain money off others’ losses by pumping up prices before selling off at lower levels, creating fear amongst investors who think it might happen again soon, thus driving them towards safety.
According to a 28-year-old crypto billionaire;
Winter is the time when most of these applications go out. As a result, you can see which projects are long-term sustainable, as in their models and their teams and their people.
The crypto winter maybe just a seasonal chill for this emerging industry, but Ethereum founder Vitalik Buterin told Bloomberg that he was “surprised” by the market’s move over last year. However, he is unsure whether crypto remains in its second winter or simply reflects volatility found within broader economies.
Related Reading | Crypto Winter Is Thawing With Bitcoin And Ethereum Rebound Signal
In Denver on February 12, he said;
Crypto markets seem to flip switches from this particular group that is controlled by a specific group of participants. It is completely disconnected from traditional markets that behave more and more as if they were part of a mainstream financial market.
Buterin added that Crypto Winter is an opportunity to make some significant changes for the better.
The dangers of using cross-blockchain bridges were brought to light this year when Wormhole’s popular crypto protocol was hacked for more than 300 million dollars. In January, Buterin warned that these types of bridges could be dangerous. It may cause users’ funds to be trapped in Smart Agreements without their knowledge or consent. So-called smart agreements are programs that issue parallel cryptocurrencies on two different blockchains.
Ethereum is working to make its blockchain faster and more scalable. Investors often criticize the popular blockchain because transactions can be slow and expensive with current technology limitations. But now, there are efforts in place that may bring some much-needed improvements for this particular ecosystem.
Finally, Buterin added;
When everyone tries to use blockchain again, no, in fact, we don’t want everyone to find out again that there isn’t enough space on the chain for everyone.
Featured image from Pixabay, chart from TradingView.com