According to the World Economic Forum (WEF), the technology behind digital assets and cryptocurrencies will always be an “integral” part of the modern economy.
The international organization discussed the crypto industry’s prospects in a blog post published on Monday. The WEF specifically emphasized the numerous uses of blockchain and cryptography technologies, noting that their use in the financial services industry is already well-known.
“Indeed, as a test of the staying power of digital assets and blockchains at the core of financial services (and other areas of the global economy), watch what the big banks and mature financial services firms do, not what they say.”
According to the report, JPMorgan has a reputation for being friendly to the crypto industry, but the bank isn’t the only one adopting Web3 and crypto.
Cryptography and blockchain technology adoption was compared to cybersecurity and digital transformation by the WEF. “The embrace of crypto technology is equally inevitable, even if the term feels like a bad word,” the organization said.
Like any other financial sector, the organization acknowledged that the crypto industry is not risk-free. However, it was noted that bad actors have few places to hide due to the transparent nature of cryptocurrency.
According to reports, federal law enforcement in New York City arrested a couple earlier this year after gaining access to files in Lichtenstein’s online account that contained the private keys to BTC 94,000 (USD 4.1 billion) stolen from Bitfinex. In 2016, the hack had taken place.
Additionally, the WEF deemed 2022 “a terrible year for crypto.” Overall, the cryptocurrency market cap lost more than $2 trillion, falling to around $800 billion from its all-time high of around $3 trillion.
The group said that recent events, especially the collapse of FTX, which was once the third-largest crypto exchange in the world, have hurt user confidence in the industry and brought global regulators’ attention.
“Policymakers who have been sounding an alarm about crypto’s excessive risks, while failing to create sensible regulations, have been vindicated by not one, but multiple large-scale failures.”
Interestingly, the WEF claimed that it would transfer crypto technology and blockchain infrastructure to more durable businesses, business models, and use cases, and compared the crypto market crash of 2022 to the bursting of the dot-com bubble in the early 2000s.