Is Crypto ready for its next natural disaster?
I’m currently in Grand Cayman where the island experienced a just-outside-of-the-cone Cat 3 hit from Hurricane Beryl.
Before the storm hit in the early morning of July 4, we spoke with locals to assess leaving or staying on the island. Almost every conversation started with Hurricane Ivan – the Category 5 storm that devastated Grand Cayman in 2004 – and how the island reacted in its aftermath. Most of the destroyed infrastructure was replaced with the foresight that the new infrastructure must weather an equally or even more powerful storm. Along with these improvements, island residents were trained on what preparations were required to minimize storm damage.
I sensed a sense of pride from the locals when they responded to the question that their island was upgraded and ready.
Today, I drove parts of the island, which seemed to be operating normally and without any major outages.
Our industry names the downturn phases of our industry’s ongoing evolution as “Crypto Winters”, but I believe they are more natural disasters than seasonal occurrences.
Some are self-inflicted and predictable (ICO bust, CeFi Crypto Lending).
Some are expected, but we don’t have a solution today (losses due to hacks).
Some come completely out of nowhere (frauds).
What’s apparent from every disaster is how our industry reacts during the storm and in its aftermath.
The issues and resolution of these disasters are played out transparently and in real-time (this is a key characteristic that we will drill into further at a later time). Infrastructure is modified and improved. Operating and investing discipline is sharpened. We emerge with a better understanding of how to weather that specific storm.
Part of the reason we say things like “1 crypto year is equal to 1 regular quarter” is because the velocity of innovation (both the ups and the downs) is accelerated due to how the industry reacts to these disasters.
We are certain there will be future natural disasters. We won’t be prepared for everything, but we learn, adapt and improve, so that a Beryl-like disaster becomes relatively harmless in the future.
—
Sony (SONY) announced the rebrand and launch of its crypto exchange S.BLOX which they acquired last year. If you’re asking why is Sony launching a crypto exchange, then you’re asking the wrong question. The question is when will other traditional technology companies announce their crypto strategy?
DISH (SATS) and Tucows (TCX) launched a Web2 domain and Web3 digital identity product – .locker. Infrastructure providers will continue to launch these critical products and services as they execute a natural transition into Web3.
See our Q2 M&A and Financings report from July 2nd and our segment on CNBC’s Crypto World (4 min mark).
Architect Partners will be at EthCC in Brussels next week.
