How Crypto Can Reset at Davos 2023

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As 2023 begins and the economic situation begins to clear up for the year ahead, there is one sector that seems to need a reset, or at least some tweaking; crypto. To avoid rehashing the negative events of 2022, there are plenty of sources that do it quite well, it’s safe to say that the crypto space is entering the new year with a somewhat damaged reputation. With the recent lawsuits against Gemini and Genesis further reinforcing the perception that the Securities and Exchange Commission (SEC) is apparently more interested in executive order regulation rather than productive dialogue, there seems to be a need to reset crypto in the year to come. Fraud, scams, lawsuits and shaken investor confidence are no way to build a healthy, sustainable and viable market.

The World Economic Forum (WEF), held in Davos, Switzerland in January (among other things in a post-COVID world), is a well-known opportunity for individuals and institutions at the highest levels of power and influence. around the world to network, analyze trends and try to predict how the global economy will evolve in the future. BitcoinBTC, the original cryptocurrency, may have been developed with the aim of disrupting, disintermediating and rendering obsolete such centers of gravity like the WEF, the reality has become more nuanced since crypto became a topic of conversation and current investment.

So the real question is how crypto will rebuild, rebound, and re-engage investors, regulators, and policymakers in the future. Let’s take a look at some of the considerations and ideas that crypto proponents would be advised to focus on during WEF 2023.

Crypto fraud is still just fraud. Much has been made of the seemingly high rates of fraud that have permeated many crypto projects, but this misses an important point. Fraud and unethical behavior happens in every industry and is not an excuse for crypto fraud. Therefore, regulators and policy makers are developing tools and rules to help prevent such activity. The crypto, which already has a built-in reputation issue in the eyes of many regulators, needs advocates to make this point clearly.

Fraud, loss of trust, and other indirect effects of the presence of fraudulent operators in an industry are serious issues that must be addressed for crypto to regain and gain market trust. To that end, making sure all interested parties realize that 1) fraud is always fraud and 2) that crypto isn’t fraud by default needs to be among the top crypto conversations.

Tokenomics is promising. The concept of tokenomics, the economics of how certain tokens work, function, and interoperate with other tokens, has also suffered a serious reputational and financial blow recently. The overt (incorrect) emphasis on price and price appreciation driving many projects, most notably the non-fungible token (NFT) space, has absorbed much of the tokenomics conversation. It is important, and crypto advocates should embrace this view, that many token applications are not price dependent, and some actively discourage token price increases.

Governance tokens, which underpin many decentralized autonomous organizations (DAOs) and decentralized finance (DeFi) applications, represent a unique way to combine many of the benefits of blockchain-based insights while also enabling aspects of finance traditional (clarity, comparability and understandability), to be integrated into the crypto space. DAOs and DeFi, even with some of the meltdowns and bad actors in the space, have proven use cases, continue to attract capital, and are sources of innovation for blockchain and crypto in general.

Tokenomics, and personalized direct ownership over information, is here to stay.

Blockchain-based data delivers results. Even during the tumultuous period that recently sent crypto into another winter, or a deep freeze depending on the interviewee, corporate adoption of blockchain-based solutions continues virtually unabated. Crypto advocates should be sure to mention that having traceable, transparent, and easily accessible records, not to mention immutable records, is an invaluable tool for individuals, businesses, and governments.

Even one of the most ardent anti-crypto people in the world, Jamie Dimon, runs a financial institution that actively developed and deployed an in-house blockchain solution to facilitate transactions. While there have been notable failures of other projects in 2022, the fact remains that 1) data is the lifeblood of any business, and 2) data storage and management based on blockchain offer quantifiable benefits that are already recognized.

Storing data might not deliver the same glittering talk as creating new NFTs, but it’s something that attracts capital, personnel and (shouldn’t) incur the ire of regulators.

Crypto and blockchain-based applications need a reset, and the Davos WEF is a great opportunity for that to happen; crypto proponents should take note and act accordingly.

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