The World Economic Forum (WEF) believes that the technology underlying cryptocurrencies and digital assets will continue to be an integral part of the modern economy.
In a blog post on Monday, the international organization talked about what the future holds for the crypto industry. In particular, the WEF highlighted the widespread applications of crypto and blockchain technologies, adding that their use in the financial services sector is already notable.
“Indeed, to test the endurance of digital assets and blockchains at the heart of financial services (and other areas of the global economy), look at what big banks and mature financial services companies are doing, not what they say.”
The report says that JPMorgan has gained a reputation for its friendly stance towards the crypto industry, but the bank is no longer alone on Web3 and crypto adoption.
The WEF compared acceptance of crypto and blockchain technologies to acceptance of cybersecurity and digital transformation. “Adoption of crypto technologies is also inevitable, even if the term sounds like a dirty word,” the organization said.
The organization acknowledged that the crypto industry is not without risk, just like any other money-related industry. However, she pointed out that the transparent nature of cryptocurrency leaves little room for bad actors to hide.
A couple were reportedly arrested by law enforcement in New York earlier this year after officers gained access to files from an online account controlled by Lichtenstein that contained the private keys to 94,000 BTC (4.1 billion) stolen from Bitfinex. The hack took place in 2016.
The WEF has also called 2022 a “terrible year for crypto”. Overall, over $2 trillion of value has been vaporized from the crypto market cap, which has fallen to around $800 billion from its all-time high of around $3 trillion. .
The organization noted that recent incidents including the collapse of FTX, once the world’s third-largest crypto exchange, have eroded user confidence in the industry and also drawn the attention of global regulators.
“Politicians who warned of the excessive risks of cryptocurrencies, but failed to enact sensible regulations, have been vindicated by not one but several large-scale meltdowns.”
Interestingly, the WEF compared the crypto market crash of 2022 to the bursting of the dot-com bubble in the early 2000s, saying it would divest crypto technology and blockchain infrastructure to longer-lived companies, business models, and use cases.