There is an ongoing conversation about the current state of crypto. While many of the larger companies and organizations have been cutting staff and expenditures recently stating a crypto winter is upon us not everyone is exactly buying the idea. When reading from both sides it seems to me that what it breaks down to is what a crypto winter is, have we already been in one, and if this is due to other factors rather than it being a crypto winter like we have seen in the past.
This post though isn't aimed at discussing the topic one way or another what I want to cover is if this is a crypto winter what could or would happen. One of the biggest things that would occur is a ton of projects will go belly up or fail. Currently, there are roughly 19,000 cryptos with dozens of blockchains. Naturally, this is a number that will not last long-term. Much like what we saw with the dot-com boom and more recently with electronic vehicles or EV SPACs a market can get over saturated and only the strong companies will survive.
Many different blockchains will fail and they will take with them the cryptos launched on them. Cryptos naturally will contract due to the sheer number that has been made in such a small period of time but as I mentioned earlier when a blockchain goes bust and fails it will bring down with it all associated cryptos. An example of this of course is Terra Luna's blockchain failure. Many projects failed however some were able to rebound and migrate to another chain since these projects were in their early stages. If for example, Ethereum failed it would cause much more destruction due to the amount of development that has occurred on it.
Having a true crypto winter would not be the worst thing in the world though as some consolidation is healthy for any industry. It allows resources to come together and be better utilized and at the same time allows needs to be better addressed. If this is it though it would not be the worst timing in the world since markets across the world are struggling. Crypto and blockchain struggle could easily be passed off as the current economic situation instead of being blamed on one thing or another. Interest also would remain strong since all industries would be suffering together.
Consolidation needs to happen and some of the much more scammy or shady projects need to be shaken out. This would help ensure future money is better directed and that the health of the industry remains intact
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