This crypto winter may be long, but builders remain bullish

Many of the top digital assets in the cryptocurrency market are down significantly, but some market participants are shrugging it off and focusing on the long game.

The top five cryptocurrencies by market capitalization have fallen 55% or more year to date, according to CoinMarketCap data. The top two, bitcoin and ether, have dropped 56.5% and 68.5%, respectively, during that period.

But Pascal Gauthier, chairman and CEO of Ledger, said during a panel at his company’s Op3n conference in New York City that “this doesn’t feel like a [crypto] bear market.”

“Now, for the macro economy, it’s a bloodbath,” Gauthier added.

For example, Swedish buy now, pay later provider Klarna is considering raising capital at about a $10 billion valuation, down from its mid-2021 valuation of over $45 billion, TechCrunch reported last week. And a number of fintech companies’ values are declining sharply, taking the downturn even harder than most other sectors.

Gauthier also referenced the Nasdaq, which is down 26% year to date. “So there are macro trends that are just impacting everything at a global scale, everywhere,” Gauthier said. “So actually, the [crypto] market is resisting pretty well and the [crypto] market has been impacted by macro events and our own greed.”

In contrast? Longtime bitcoin holder Dan Held, director of growth marketing at crypto exchange Kraken, said during the panel that “this crypto winter is as harsh as the other ones.”

“It’s going to be cold, but I’m still as bullish as ever on bitcoin,” Held said.

This differs from Held’s perspective just a month ago, when he said he didn’t think this crypto winter would be as harsh as others. Held joked that he “might have been off” on that prediction, but still, he pointed to how massive the crypto space is now compared to previous years.

“We’ve got tens of billions of dollars invested in this space from VCs,” Held said. “The community is massive now; I mean, this is crazy, like the Bitcoin conferences back in 2013 literally had as many people as in this room — they were tiny.”

Fear and greed

Even with pools of capital funding the space, every crypto winter mimics human behavior surrounding fear and greed, Held said.

“We’re in the fearful part — you’re probably looking at your account and you’re like, ‘Fuck, that hurts,’ [because there’s] a lot of red all across the board. That’s a feeling that we all have, even old HODLers like myself.”

But investors should look at the current market with a long-term perspective and consider why they bought it in the first place, Held said. “You’re investing in something, whether that be bitcoin or equities or something else that you believe someday in the future, more people will find it valuable or it will go execute and do well.”

No longer looking at green candles

“It might be chilly out there on-chain,” but off the blockchain, it is a “balmy … fun season” as people across the industry focus on this “build-and-buy market,” Evin McMullen, CEO of metaverse-focused, said during the panel.

“Now that we are no longer looking at green candles to keep us occupied, we have an opportunity to explore what other kinds of fun we can have,” McMullen said. “What other kinds of coordination games can we solve together that are not just based on token prices but are based on our activities as human beings?”

Now, the crypto world is working on building human experiences beyond throwing money at each other, McMullen said.

“There’s a lot of smart people building [and] a lot of money, so I think it’s going to be a very productive [time],” Held said. “I like the winters, too, because you can go build; it’s less distracting. So I think it’s a time to build and I’m still very bullish.”