Crypto's Starvation Death

Shaan Puri shares his perspective on the future of crypto following the FTX collapse, suggesting that while the industry faces significant challenges, its potential demise would come from lack of utility rather than scandals or competition.

Key Points:

• Crypto's Future Trajectory:

  • Next couple years will be "bad news bears" for crypto
  • Predicts a "crypto winter" that could last several years
  • Bitcoin and Ethereum will likely survive and remain relevant
  • New legitimate cryptocurrencies may emerge in the future

• Industry Casualties:

  • Most current overvalued coins will go to zero
  • Nearly 100% of Web3 startups that raised money will fail
  • Most altcoins will disappear, leaving mainly Bitcoin and Ethereum
  • NFTs predicted to go to zero

• Survival Factors:

  • Coinbase likely to grow as the "trusted" exchange
  • Trust will centralize around established, regulated players
  • Industry won't die from scandals but from lack of product-market fit
  • "Startups don't usually die due to competition... you died because you starved"

• Core Belief:

  • Crypto is "real and is gonna work" despite current challenges
  • Industry needs strong use cases to survive long-term
  • Death would come from lack of utility, not from competitive forces
  • Trust in innovation has been severely damaged

• Market Recovery:

  • Industry will need 5-10 years to recover
  • Most current projects won't survive this period
  • Future growth will center around proven use cases
  • New trust will need to be rebuilt with consumers