The crypto executive cites lower labor costs and business acquisition costs as key factors.
During a live panel at the Web Summit in Lisbon, Changpeng Zhao (colloquially styled as CZ), CEO of cryptocurrency exchange Binance, shared his viewpoint on why it’s so important for crypto projects to continue their development in the bear market. As told by CZ:
“It’s easier to hire talent in the bear market. A year ago, a college graduate knowing a little bit of Solidity programming cost a lot of money. The salaries just didn’t make much sense to me, but now it’s come down to very reasonable levels.”
“Now it’s easy to hire people and grow,” he said, while also pointing to the declines in project valuations: “A year ago, every project with a test product or six-page whitepapers was worth $100 million. Currently, the valuation is very reasonable.”
CZ explained that a combination of lower labor costs and less expensive projects has made it an ideal environment for corporate acquisition and consolidation. “For example, a year ago, everybody wanted to sell a nonfungible token, but now, only the strongest of projects are doing it, so the selection is actually much better.”
As for a possible end to the bear market itself, CZ pointed out that crypto market cycles typically last four years, with one year of falling prices, then two years of recovery, and a final year of rising prices. The Binance executive and blockchain personality also reiterated that he believed in the long-term potential of crypto: “We’re very long-term investors. So we anticipate to be involved in the space for the next 10, 50, or 100 years.”
A brief history of “#bitcoin crashed”…
Crypto is high-risk and highly volatile. Learn to manage your risks.
— CZ Binance (@cz_binance) November 2, 2022
CZ also cited emerging signs of a market turnaround: “Right now, there are exponentially more people now trusting crypto instead of not trusting them. In addition, the industry has grown tremendously over the last however many years.” But he also cautioned against using historical evidence to make forward judgments, saying: “So we are close to a year into this bear market, but I cannot predict the future because, at the end of the day, history doesn’t predict the future.”