The World Economic Forum (WEF) is a non-profit organization where world-renowned politicians, representatives of business and international organizations, academics, civil society organizations and journalists gather each year with the aim of improving the economy around the world. Our Prime Minister Mark Rutte, among others, is present here every year.
In an article by the WEF compares it last year with the well-known dot com bubble, but it is not entirely negative about the emerging sector of cryptocurrencies. The article is written by Digital Currency Governance Consortium civil servant Dante Disparte.
Is crypto the same as the dot-com bubble?
To begin with, it is useful to know what the dot-com bubble was exactly. This was a ‘bubble’ in the stock market in the late 1990s, where the value of shares of internet companies rose rapidly. However, the bubble also ‘popped’ in the spring of 2000, as prices collapsed. As a result, many internet companies had to throw in the towel.
As mentioned, the writer of the article compares the crypto market with this internet bubble. This sounds dramatic in a way, but Disparte indicates that it can actually be positive for the future of crypto and web 3.0:
Just as the burst of the dot-com bubble in the early 2000s was necessary to transfer the future of the Internet to more sustainable companies, business models and use cases2022 may mark a transfer of crypto technology and blockchain infrastructure to firmer hands.”
Future crypto
Disparte also pointed out that regulation of the crypto market will benefit the emerging sector. It indicates that ”the countries that enable responsible competition will shape the future”. In addition, the WEF article acknowledges the role of blockchain technology in the general financial sector:
Cryptography and blockchains will remain integral parts of the modern economic toolbox, despite the great damage these tools have caused when handled by the wrong people.