$1.4 trillion wipeout hits crypto industry at WEF

There were fewer crypto companies along the Davos Promenade in 2023 after the market crash than in previous years. Circle, the company behind the USDC stablecoin, was one of the few.

Arjun Karpal | CNBC

Davos, Switzerland — Over the past few years, the World Economic Forum in Davos, Switzerland has witnessed a surge in cryptocurrency industry attendance.

However, after a wipeout of nearly $1.4 trillion in 2022, the crypto industry has become a little more wary of cash splashes, with several companies spotted last year not attending. 2022 has been marked by failed crypto projects, liquidity problems and bankruptcies, culminating in the collapse of his major exchange, FTX.

At the World Economic Forum in May last year, Bitcoin It was hovering around $30,000 after already down more than 50% from its all-time high in November 2021.

The Promenade is Davos’ main street where businesses and government take over shops and cafes for a week.Last year, cryptocurrency companies from all walks of life took over the placeBut since the market crash, far fewer crypto companies have flashy storefronts in Davos.

One shop selling non-fungible tokens (NFTs) has disappeared. The price of NFTs, digital collectibles, also plummeted last year. What remains are companies that have survived the bear market and are looking to expand their operations.

Teana Baker-Taylor, Circle’s Vice President of Policy and Regulatory Strategy, said: The company behind the USDC stablecoin.

A stablecoin is a type of digital currency that is supposed to be pegged one-to-one with fiat currency. USDC is pegged to the US dollar. Circle says one he can redeem USDC for $1 because it is backed by real world assets such as the US Treasury.

Casper Labs, the company that built blockchain designed for business use, runs a space on the promenade called Blockchain Lab. Casper Labs also attended last year’s Davos conference.

Cliff Sarkin, head of strategic relations at Casper Labs, said he was “cautiously optimistic” that the cryptocurrency market had bottomed out.

“We’ve been in a bear market for over a year now, so I think the shock has worn off,” said Cerkin. ” said CNBC.

He added that crypto firms remaining in Davos are “substantial projects” and “real deals” as opposed to things like NFTs.

Some traditional financiers welcomed a handful of crypto companies.

Mark Höfele, Chief Investment Officer of UBS Global Wealth Management, was asked at an event hosted by the Swiss bank what he would like to see at Davos this year. He said he’d already seen it: “It’s not a Main Street cryptocurrency.”

The Mysterious Case of the Orange Bitcoin Car

On Monday, a flashy bright orange Mercedes-Benz car was parked outside the Blockchain Hub on the Promenade.

The orange Mercedes was parked along the Davos promenade. No one nearby saw who parked there. The license plate says “Kuna”, the name of a Ukrainian cryptocurrency exchange.

Arjun Karpal | CNBC

A coin representing Bitcoin was placed where the Mercedes-Benz logo would normally be. The tires and license plate had the words “in crypto we trust” printed on them. The license plate had the Ukrainian flag and the name of Kuna, the company that operates the cryptocurrency exchange of the same name.

Kuna also established the “Ukraine Reserve Fund” where people can donate cryptocurrencies to Ukraine after the war with Russia started.

People nearby who CNBC spoke to couldn’t confirm who parked their car there.

However, two cryptocurrency executives who spoke to CNBC did not welcome the orange car. Especially after the market crashed and the industry’s excesses were exposed. The existence of such cars has not helped the industry’s reputation, which was hit hard last year, he said.

CNBC reached out to Kuna Exchange CEO Semen Kaploushenko via LinkedIn but has yet to receive a response.

CNBC has also reached out to the Ukrainian Blockchain Association, chaired by Kuna founder Michael Chobanian, but has yet to receive a response.

The license plate and tires had the words “in crypto we trust” printed on them.

CNBC | Arjun Karpal

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