In Davos, Crypto and Blockchain Firms Increase Their Presence at the World Economic Forum’s Annual Event

Whiskey had its work cut out.

A year after massive losses, arrests and deployments Due to legal troubles, many of the world’s largest cryptocurrency and blockchain companies are returning to Davos this year, hoping to bolster the industry’s image, revive it if needed, and attract new investors. is.

The annual gathering of the world’s elite, known to bring billionaires, bankers and heads of state together, is an industry long touted as an alternative to traditional banking, out of reach of governments and financial institutions. has become an unlikely destination for And while a few key players have been missing this week, including crypto giant Tether, who handed out free pizza at the conference for at least a year, many others have been reported missing on official panels and private Both shops, yoga studios and churches are doubling down on their presence here. What they turned into a promotional event space for the week.

Dante Disparte, chief strategy officer at digital currency and payments company Circle, said: “2022 was the moment of the dot-com demise of cryptocurrencies. Now we have brought in key executives to publish a lot of content that shows the technology is here to stay. This is an important part of modernizing the global financial system, and it is an important agenda-setting moment.”

Is crypto the house of cards?

The company, which issues a widely used US dollar-pegged cryptocurrency, doubled its investment in Davos this year and now has two stores and more than a dozen employees on its main drag. Like many of its peers, the Circle has focused on topics like trust and responsibility this year, dubbing it a “great reset” for cryptocurrencies.

This reset comes on the heels of a tumultuous year for the industry.cryptocurrencies such as Bitcoin has lost more than half its value in the past year. The whole enterprise collapsed. Most notably, his $32 billion cryptocurrency exchange FTX happened in November. That spectacular collapse put the founder in jail and raised big questions about the long-term viability of the industry.

Bitcoin’s value fell sharply last year, hitting over $45,000 in March before dropping to around $16,000 in November. However, the last few days have seen a bit of a revival, with him trading above $21,000 this week, giving his supporters some optimism.

“Crypto Winter” is here. And it looks like an ice age.

At the same time, government regulators are beginning to comb through the industry with renewed urgency, issuing fines and subpoenas.

As a result, many blockchain companies that provide the information storage technologies that power the cryptocurrency market are focusing on more neutral topics such as sustainability and innovation. The Circle’s building is emblazoned with the tagline “Solving real-world problems.” Hedera, whose token lost 80% of its value last year, bills itself as “the greenest blockchain.”

Nirmini Rubin, Head of Global Policy at Hedera, said: “We are seeing the bad guys disappearing and what is left are the more stable and better managed cryptocurrency players. It’s an opportunity to reclaim what is.”

Still, some question the view of spending so much in Davos when so many people, not just pension funds and venture capital, have wiped out their investments.

“When FTX collapsed, some of the biggest criticisms of the industry were about excessive partying, celebrity culture, and overall lifestyle extravagance,” said Cryptocurrency and Financial Markets. “So at this point, it’s shocking that we’re doubling down on the same thing in Davos.”

However, the criticism is not limited to one industry. The annual gathering here is a frequent target of critics who say it is insensitive and superficial, with elites discussing lofty topics like global solidarity and climate change with little action. This year, the war in Ukraine and growing concerns about the global recession continued to dominate much of the conversation, both at official events and after-parties.

Meanwhile, high-profile regulars such as Amazon, Microsoft, and Facebook parent company Meta continue to have a prominent presence here despite the recent layoffs of thousands. Salesforce, which announced plans to cut about 8,000 jobs this month, or 10% of his workforce, has three of his stores on the hallowed promenade, more than any other company. (Amazon founder Jeff Bezos owns the Washington Post.)

Will Davos save the world or pull it out of its misery?

Crypto’s huge presence began at the Davos conference last year, when currencies such as Bitcoin and Ethereum were booming. At the conference, two official panels were devoted to blockchain technology, and companies spent a lot of money on advertising and hobnobbing. Huge billboards advertising buzzwords like “blockchain” and “Web3” filled the streets, surprising many longtime conference attendees.

This year, its presence is even greater. The official program will have seven blockchain sessions, including panels on regulation and digital tokens.

“This is an area where we spend a lot of time,” said Brynley Lill, Head of Blockchain and Digital Assets at the World Economic Forum. “Cryptocurrency is not always a glamorous topic, but we want to demystify it and show that what you see in the headlines is not about technology.”

Many in the industry say the recent turmoil is only temporary. They call this moment a “crypto winter” and argue that the recent cold weather is simply a cyclical correction in markets that will recover quickly. Skepticism remains strong.

“This feels like the last gasp for cryptocurrencies,” said Jason Furman, a Harvard University economist and former Obama adviser and frequent World Economic Forum attendee. Who skipped the meeting this year. “It’s like the ad you saw in a magazine saying the real estate market was hotter than it’s ever been. People who were paying for that ad six months ago, by the time it came out, It turns out to be utterly wrong and ineffective, and that is the Davos cryptocurrency.”

The companies that helped create 2022’s “Crypto Winter”

But industry executives say the brilliance of the Davos meeting and its relationships with financial institutions and global governments will become even more important to the industry this year as regulators introduce new rules and step up scrutiny. Crypto firms will spend $7.1 million on lobbying in 2021, up from $2 million the year before, according to an analysis by the Center for Responsive Politics.

“What the crypto industry really wants is to be integrated and regulated with mainstream finance, but to be established,” said Hillary Allen, a law professor at American University. “We hope the regulatory patina will attract new investors. The need for new money is becoming more pressing. So where better to go than Davos?”

Back at the Blockchain Hub, funded by Casper Labs, a cryptocurrency issuer and subsidiary of blockchain company Casper, the whiskey tasting was one of more than 50 events planned over four days. A few hours ago, SkyBridge Capital founder Anthony Scaramucci, who bought $10 million worth of his FTX tokens, spoke on a panel about his falling out with Sam Bankman-Fried. bottom.

“Betrayal and deception are bad on many levels,” said Scaramucci. “It hurt my reputation. It really sucks to have a friend who betrays you like that. But that doesn’t mean the end of blockchain or cryptocurrencies.”

US hedge fund subpoenaed in probe of cryptocurrency exchange Binance

Go down the block and you’ll see the town sign in your message. “Escape the hell of controlling banks and governments,” says a cryptocastle propagandist in Germany. Another near the parking lot proclaims to the richest people in the world: And freedom is wealth. “

Tory Newmyer and Julian Mark contributed to this report.