Vitalik Buterin, the co-founder of Ethereum, has disappointed many crypto lovers. In an interview with Bloomberg, he noted that “opportunities for 1,000-times growth no longer out there.”
“The blockchain space is getting to the point where there’s a ceiling in sight. If you talk to the average educated person at this point, they probably have heard of blockchain at least once. There isn’t an opportunity for yet another 1,000-times growth in anything in the space anymore,” he noted.
He then added that the reason behind the stunning growth in BTC and altcoins can be explained by various marketing strategies and attempts to get wider adoption.
“That strategy is getting close to hitting a dead end,” he said. So what is next? In Buterin’s view, people need to cease being simply interested in cryptocurrencies and get more involved. “Go from just people being interested to real applications of real economic activity,” he said.
These statements come against the fact that ETH has slumped dramatically. If in January 2018 it traded approximately at $1,400, now it barely reaches $199. It is, however, worth noting that the market capitalization today is bigger compared to the same period last year when BTC traded at $1000.
What does in-depth engagement mean?
Buterin’s stance is comprehensible, and he does have a point when saying that most people have heard about blockchain or cryptocurrencies. For example, in May the Dutch bank ING published the results of a survey which showed that people from around the world (predominantly Western states) are aware of cryptocurrencies. In less developed countries, like South Africa, respondents are also to a certain extent familiar with the phenomenon; in Kenya, there is even a special blockchain-based app which is used by local small businessmen.
While it is also true that, for example, the ING survey showed that people, albeit knowing about crypto, are not willing to buy into it, one can argue that the in-depth engagement that Buterin is appealing to is already there. Thus, it has been confirmed that Goldman Sach will open a BTC trading desk after all and HSBC and ING have already made a blockchain-based trade finance operation.
The governments are not lagging behind: As David Freuden wrote last month, every week “there is another government announcement of how and where they are launching a blockchain solution or supporting a blockchain initiative.” Concurrently, the National Research Council of Canada (NRC) is launching a blockchain explorer on the Ethereum blockchain for published grants and contributed data. Researchers are also extremely optimistic and have emphasized that crypto payments will become mainstream within a decade.
Hence the question: If that is not enough to boost the sector and drive up the prices significantly (forget MacAfee’s $500,000 type of predictions), what kind of developments are?