Investors are left scratching their heads as the current slump in the cryptocurrency market drags on. To that end, in a recent blog post, Matti, one of the co-founders of the private investment firm, Zee Prime Capital, shares his belief that the next bull run can only be triggered by a new use case for blockchains and cryptocurrency.
Matti argues that people are far too eager to believe the worst of the current slump is behind us. This he says makes people fall for experts who cite market fundamentals, ignoring the fact that these very experts were the first to denounce fundamentals as the markets scaled to unprecedented levels last year.
“It is ironic that we laugh at fundamentals when times are good but beg for the market to recognize them when times are bad,” writes Matti. “There is one I’ve heard of recently. It was given the name of ETH Merge.”
While Matti acknowledges that the Merge was a fundamentally significant event, not just for Ethereum, but for the entire crypto sphere, he says the market takes time to recognize the significance of such important events, which is why the event didn’t result in the market turnaround that many experts were betting on.
Based on his experience, Matti says that, unlike the previous slumps, this is the first crypto winter that’s coincided with macroeconomic upheaval with growing interest rates, inflation, and more.
Rather than trapping themselves into a false sense of relief, Matti suggests investors should dig in their heels and wait a while, “because you can’t plan on innovation and that’s the only thing that will bring price relief.”
To underline his argument, Matti points to crypto lending, non-fungible tokens (NFTs), and blockchain gaming (GameFi) as the catalyst for last year’s bull run.
Gazing into the crystal ball, Matti also used this blog to list some promising technological triggers that can help trigger the revival.
In early 2020 at the beginning of the Covid crisis, Matti imagined local lending decentralized finance (DeFi) apps could help bridge cryptos with the real world.
“Today I am curious about how we bridge DeFi to actual commerce,” writes Matti. “Bridging this gap would allow DeFi to grow into more sustainable products and Web3 native solutions that are not purely based on speculation.”
Matti points to GameFi, using the example of StepN, as a catalyst for reinvigorating decentralized commerce. He suggests things such as in-game purchases could perhaps be extended to get people to spend money on blockchain on things besides gas fees. Another rendition of decentralized commerce could be related to content production and monetization.
Matti assures that while it is important for the community to keep its eyes peeled for new ideas and use cases, it must also “not get overly pessimistic” in the meantime.
