Despite the chaos in crypto, a fourth growth cycle is brewing
Renowned crypto investor, Andreessen Horowitz is optimistic about the development prospects of the industry. Despite chaotic growth cycles, the basic drivers for software innovations are there, he says.
At the end of April, a new crypto fund came on the market. Endowed with $ 515 million and launched by the famous investor Andreessen HorowitzThe aim is to use the next growth cycle.
For his investment company a16zthe crypto and blockchain sector is known to date three main cycles of growth and innovation. And she expects a fourth. In a market analysis, the fund recognizes that the course of this industry was characterized by turbulence.
The projects of 3e Cycle triggers a 4th
“Even though the cycles of crypto appear chaotic, in the long run they have a Constant growth of new ideas, codes, projects and start-ups However, take into account the a16z investment team.
“Technology experts and entrepreneurs will continue to drive cryptography in the coming years,” she adds. To anticipate this future growth, Horowitz relies on the three previously observed cycles.
“A key feature of cryptocycles is that everyone plants Seeds that then grow and lead to the next cycle “Said the investor. And the last seeds would have been sown in the last cycle between 2016 and 2019.
“The third cycle, which peaked in 2017, is one in which the broader impact of crypto has attracted public attention. This cycle has again multiplied the number of developers and startups in this area by around 10. Crypto has left the periphery to become a real start-up sector, ”analyzes a16z again.
Developers and startups multiplied by 10
To base its hopes on a fourth cycle, the mutual fund relies on several indicators: Bitcoin growth, number of startups founded, social network activities, and developer contributions.
A favorable indicator is the emergence of several large projects on the market in the reporting period.
The 2017 cycle has spawned dozens of exciting projects in a variety of areas, including payments, finance, games, infrastructure and web applications. Many of these projects will be launched in the near future and could lead to a fourth crypto cycle, ”said the VC.
The latter does not go so far as to predict the date of the next cycle. Investments made by the Crypto Fund II instead, should provide pointers to the crypto applications that are driving the new growth cycle.
The a16z fund already has stocks that could act as indices: the exchange of YdX derivatives, the Dfinity cloud platform, from the provider Stablecoin Maker or even the cloud actor Oasis Labs, the “data protection in the first place”.