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Crypto Winter

That crypto winter has arrived is nothing new. While we reached the crypto market cap ATH in November 2021 at US$3.0 trillion with more than US$226 billion being transacted, we are currently at a value 65% below the ATH, 55% below the average of the last 365 days . However, can we say that we have already reached the floor price?

Although Bitcoin has returned to its December 2020 value, the average price of the last 365 days is 59% higher than the average two years ago. This is without considering the average of the last five years, where the current price is almost 80% higher.

And let's get to the main issue: a high volatility market needs to be understood not by its spot price, but by its long-term curve.

The key is to understand that the crypto ecosystem is not just a variable income market, it is a technology that can be applied to the financial market, summarized by its market value. If we look at the number of new protocols being created, new solutions using crypto as a front of innovation, the potential that infrastructures using blockchain unlock, the universe is gigantic. And the greater the maturity and applicability of the technology in our real lives, the greater its market value.

An example that proves this movement is the market value of DeFi assets, the famous decentralized finance. In just one year, the total calculated for these assets jumped 64%. With DeFi, we have already unlocked the peer-to-peer universe of payments, loans, insurance contracting, crowdfunding, financial controlling, among many other applications. And we are just at the beginning.

Another example that demonstrates the size of this potential is AuM held via DAO’s. also known as decentralized autonomous organizations. The DAO functions as a registered society, hosted and organized directly via blockchain. Top DeFi assets, NFT projects, dApps can be governed by DAO’s. With the growth of blockchain technologies, the value hosted in DAO's has currently exceeded US$ 10.2 billion.

In conclusion, these examples prove that “crypto winter” is a term only applicable to the volatility and price effects of some cryptoassets. Crypto technology, its business maturity and the innovation being unlocked in our everyday lives are in for a summer with lots of sun, heat and cool shade.


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