Another year, another Consensus. Consensus 2022 was very special. It is still the one place where you get the best of everything in blockchain whether it is miners, stakers, yield farming protocols, Layer 1 and Layer 2’s, exciting decentralized financial protocols, DAO’s, NFT marketplaces or even metaverses - among other areas. Consensus 2022 didn’t disappoint, with some of the biggest names in the business in attendance. CZ from Binance, SBF from FTX and Charles Hoskinson from Cardano along with many others. A lot happened this year but let's dive into my 3 main takeaways:
It is not about price. It's about development.
In previous years there has been a lot of discussion and excitement around trying to project where the prices of cryptocurrencies like Bitcoin and Ethereum will go. Will Bitcoin hit $1,000? $5,000? $10,000? $20,000? Last year we were in the middle of a bull run and there was a major announcement with El Salvador’s legal tender of Bitcoin. They made a monster announcement and then purchased a ton of Bitcoin and were spreading it to their local population. In the past we’ve spent so much time talking about the price as if that was the core way to evaluate progress in the cryptocurrency movement.This year nobody talked about price. Of course, there is nothing to talk about with markets in bear territory - cryptocurrency not being any exception; however, it was wonderful to hear the focus change this year to key developments happening in the space. Institutions like American Express and Moneygram are continuing to adopt crypto with new programs like the new American Express Credit Card or Moneygram’s new partnership with Stellar to instantly convert/transfer cash around the world through crypto.
Regulation, Regulation, Regulation.
I know, regulation is not everybody's favorite topic. But with the UST/Luna debacle, the Celsius Network situation (which may be getting exacerbated with 3 Arrows Capital and Babel Finance) and of course constant rug pools here-and-there, it is important to highlight.
There was consensus at Consensus 2022 that we need to come together as a community to drive and encourage more boundaries and rules. For this reason, it was great to have Senator Loomis and many other government officials at the conference to discuss the importance of their new proposal to regulate and treat cryptocurrencies similar to commodities in the CFTC. There was also a growing agreement that KYT (Know-Your-Transaction) was gaining steam and that all transactions in the thousands will be tracked more closely by authorities. Of course there was some hesitation, especially from established exchanges, about publicly listing their owned addresses. But these are good things for the industry to discuss and figure out.
DeFi is back in.
There were so many exciting decentralized financial protocols this year. We had the chance to meet some up-and-coming defi lenders and we even started hearing a lot from exchanges and wallets for a need to provide more financial services and support for their customers with defi being a very convenient means to do so. It was exciting to see new partnerships developing and meaningful conversations that really brought everyone back to the root of defi: how do we help provide financial services in a new way to support those who cannot or are not being effectively supported by traditional finance? It was interesting to hear how exchanges and wallets have added new services over the past year: Metaverses, NFT Marketplaces, Cloud Mining, etc. But these services haven’t moved the needle in terms of truly helping their customer base. These new additions have just been cool upgrades to allow people to have more fun in the blockchain world. But the focus now is on how they can leverage defi to truly support their customers. We did have a chance to talk to some centralized financial protocols but attention this year definitely seemed to be on decentralized protocols, especially considering the Celsius debacle was unfolding live during the conference.
Lastly, to leave you with a thought provocative quote I heard:
“You can now buy a burrito at Chipotle with Bitcoin. But did you know that Chipotle still ultimately receives cash from your crypto transaction? This means that many merchants accept crypto as payment are not holding onto it. Nevertheless, this is a big step forward in crypto adoption as it becomes a means of payment.”
Leo Lu, Chief of Staff, Crypto at Cross River