In cryptocurrency, the market is always the greatest teacher
by Umesh Perera
Amid the current crypto meltdown we should perhaps remind ourselves that the market has shown us that the technology works. It did not break under a large amount of stress.
Remember, the storm involved a stable provider, Luna, a massive lender, Celsius, and one of the biggest hedge funds in the space, Three Arrows Capital. All got into trouble. Entities toyed with leverage and synthetic assets.
This will have somewhat of a contagion effect and is now causing pain in the short term. But the rails did not break. Great resilience has been displayed.
The main Achilles heel we are seeing is that there are too few real assets on those rails. We have always been sensitive to this whilst building our platforms and company, Ayozat. Real assets are everything, we do not care about fancy names or denominators.
Byron Gilliam attracted media attention this week, stating in Blockworks that cryptocurrency needed substance over gimmicks. His work for the Frankfurt Stock Exchange taught him that hard maths ultimately decided the market.
“This bear market will not truly end until DeFi and crypto build new use cases — specifically, use cases that will allow revenue to increase independently of token prices,” he said.
I largely agree. UK companies in the domain need to soak up those words.
Our viewpoint on technology is realistic – namely, the use of the correct technology to solve a specific problem. We do not believe in Web2 and Web3 segregation. That could be in relation to blockchain or PHP or NFTs, it does not matter. Substance is everything. Our network powers and distributes our client TV channels, we own our advertising servers and media copyright catalogues – bringing real value and solving actual problems is key.
Users should be fans, family and partners in a sustainable ecosystem. Therefore real assets and liquidity is a must.
A bear market is, by nature, frightening. But I welcome it, in the hope it is short and shakes out the pretenders and the profiteers.
There are some fantastic British companies that have built in the right way; they will not fear the current market shakedown.
Umesh Perera is the founder of Ayozat.