The infamous bear market which began in early winter of 2017 – now popularly called the crypto winter – has hit hard on many startups and rendered many projects as wastelands.
Many startups that raised their funding caps later fell short of expectations due to the reduced value of funds collected in crypto and could no longer fulfill their obligations to the development timeline. While some are yet to produce a working prototype and have relied mainly on market situations to remain significant, others kept their funds in fiat and were able to maintain development strides. These are building bridges and establishing quality partnerships relevant to their stay in the industry.
Some startups resolved to layoffs and reorganizations when they could no longer manage allowances and had to cut down on excesses to maintain minimum operations for their project. Consequently, a large number of developers and blockchain experts have been returned to the job pool.
Some companies successfully raised their capital and chose not to get listed on any exchange but rather adopt the ‘BUIDL’ route to salvage whatever little significance the development trend could offer. Moreover, many never raised enough to make it to any trading platform, so it was the perfect excuse to ‘BUIDL’.
In the middle of these occurrences, some startups remained valiant and challenged the bear market head-on. Some shared their experiences and opinions with news outlet Coindesk, and maintained that they were going long with the overall crypto outcome.
For some of them, this was possible only because they were survivors of the previous bear market in 2014 and now understand the terrain better, especially after witnessing the huge spike in the price of bitcoin to sky-high USD 20,000 – a feat many are eager to see again.
“We were expecting an extended downturn as we were around for the last bear market,” Matt Luongo, the project lead of Keep told Coindesk in a response to a ‘crypto winter survey‘.
Another respondent Brayton Williams, a co-founder of Boost VC opined: “This ‘winter’ is 100X better than the 2014/15. People don’t think crypto is going to die. They are all just trying to time for when it comes back. In 2014/15, the conversation was all about if crypto survives at all.”
One peculiar observation in the crypto startup trend is the likelihood that the ecosystem is gradually resembling the initial public offering façade that most have dreaded. “The investment money is returning back to the norm of difficult to obtain. I think the ‘winter’ is greatly exaggerated. We are just back to normal behaviors,” says Williams.
It is important to note that this isn’t the first bear market in the history of crypto. The flagship crypto Bitcoin has seen a fair share of dramatic price fluctuations over the years. Perhaps the reason this particular one has become more noticeably disturbing is the fact that the rate of exposure was greatly facilitated by players from outside the cryptosystem, yet it remains unknown why the gradual shift in paradigm, the interest from institutions, and possibly support from government organizations have had little effect on price movement.
However, some that have done well have advised that ICOs spread their capital across crypto indices or liquidate as much from the funds collected to run development for up to a minimum of two years.
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