Another year, Token2049.
Last year’s Jewish controversy is still fresh in our minds. This year, the new wave is surpassing the old wave. After the passionate event in Hong Kong in April, Singapore has once again demonstrated its strength, shining brightly at Token2049. From a data perspective, this conference is undoubtedly a success. According to the organizers, the number of attendees at this conference reached a new high, with over 10,000 people attending in person, more than 300 exhibitors, and over 400 peripheral events. It has become the world’s largest Web3 event of the year.
However, returning to the reality, after nearly half a year of ups and downs in public opinion, the fluctuating policies and high costs have made Web3 practitioners more cautious about “heading south”. Singapore, which used to be crowded with people, is now facing the bustling reality.
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How will the industry at the crossroads of regulation develop? Industry professionals have different answers to this question.
At first glance, compared to the explosive market sentiment caused by the suppressed Hong Kong conference due to the epidemic and the internet celebrity effect caused by a beautiful photo, the most obvious feature of this conference is the squeeze on outsiders. Regardless of the visa requirements and air tickets, the hotel prices in Singapore, which soared to thousands of yuan per night, have also restricted the curiosity and check-in of some people. At the same time, unlike the numerous free food and drink events and dazzling LianGuairty in Hong Kong, although most PR-themed conferences do not restrict free food and drink, a high-quality venue in Singapore often means selective and targeted invitations. It is rumored that even for invitations, KOLs no longer include air tickets, and it is said that the exhibition hall for this conference is smaller than before. Therefore, overall, Token2049 has conducted screenings for participants in terms of industry and cost. A more obvious phenomenon is that during the Hong Kong conference, almost everyone on Twitter was located in Hong Kong, but at Token2049, although the behavior of posting photos, addresses, and showing presence is common, many key opinion leaders (KOLs) in the industry did not attend. There are even cases where some individuals have expressed a preference for holding coins instead of attending the conference.
The implicit screening can also be seen from the guest invitations and the participating crowd, showing the significant East-West effect corresponding to Hong Kong and Singapore. Since the previous events were held around Hong Kong’s new encryption regulations, the Hong Kong carnival was mainly dominated by Chinese-speaking participants, with well-known Chinese-speaking KOLs such as Baoye and Wang Feng attending the conference. The guest list was also dominated by Chinese faces. However, the guest invitations in Singapore cover a more diverse international group. In addition to native cryptocurrency experts like Vitalik Buterin, many well-known overseas projects also participated in the conference. The guest list includes companies such as Ripple, BitGo, and Uniswap, and the founder of the popular OpenAI, Sam, also participated in the fireside chat as a co-founder of World Coin Alliance.
Of course, like other large conferences, the Singapore Web3 Conference cannot escape the collective revelry of the social scene, filled with gossip and rumors, WeChat groups filled with beauty pageants, double chins, and vegetable parties. The conference is full of talking points. Fortunately, with the support of many capital and technology giants, compared to Hong Kong, the conference still focuses on Web3 technology.
From the themes of the two main conference agendas, the direction categories are generally consistent. Singapore also covers topics such as AI, metaverse, DeFi, and Bitcoin. From the public columns alone, there are many sub-topics that claim to be technical but are actually business promotions. However, compared to the Hong Kong session, there has been an increase in technical discussions, which is closely related to the diversity of the participating guests. As of September 16th, within less than 6 days, 20 hackathon activities have been announced in the surrounding area. Regardless of the effectiveness, this indirectly reflects the increase in the technical attributes of 2049. This also conveys a rare sense of optimism in a bear market, after all, where there is technology, there are stories.
However, from the perspective of actual participants, different perspectives have different themes and conferences.
To this end, Lattice Finance has integrated the viewpoints and conference experiences of some of the participants, to see the viewpoints and trends discussed by the industry leaders in Singapore.
Phyrex@Phyrex_Ni
The first word: Payments.
The exhibition hall this time is not very big. There are not many booths on-site, but about one-third of the projects are related to payments. Among them, not only local companies in Singapore, but also companies based in the European Union or registered in offshore islands have surprisingly overcome payment channels. If we add asset custody and financial audit companies, this part of the projects accounts for more than half. One area of the exhibition is entirely related to funding projects. Moreover, the nature of most of the projects is compliant or partially compliant OTC, mainly targeting the US dollar and the euro. They are almost related to the renminbi and have some relationship with foreign trade even if they are not completely compliant. What’s more interesting is that I talked to almost every payment company, no matter what type, they all focus on withdrawals. This indicates that the withdrawal environment is more prosperous at present, and more cryptocurrency investors worldwide are looking for compliant and large-scale withdrawal solutions. I remember that in 2021, even when BTC surpassed $64,000, there were not so many payment-related applications at various overseas exhibitions, and payment-related companies are undoubtedly centralized.
The second word: English
When I was in Hong Kong, I wrote an article saying that almost everyone spoke in ABC. Even if they knew that the other party might understand Chinese better, they would still choose to speak English, and Cantonese is also very popular. This time it’s quite interesting. Although most of the booths are supposed to be from Singapore, communication in Chinese is very smooth. Almost every booth of Asians can speak fluent Chinese, and of course, their English is better. A few Indian, Middle Eastern (presumed), and European and American booths are mainly in English, but if they find that you don’t understand, they will try their best to explain it to you. It makes me feel that they have done their homework. However, from Hong Kong to Singapore, there are still too few “white people” attending the conference, and most of the project parties speak Mandarin better than I do.
Third word: Money is great
In Singapore, there are two types of people who live the best lives. One is those who are already wealthy, including project parties, who enjoy widespread recognition. The second type is those who have sufficient budget (reimbursement), and they can also watch the world with a smile. Moreover, most of these individuals are good people, and they are the ones to approach if you need help getting tickets. The rest of us are like me, who wander around. As long as we have thick skin, we can still profit from eating and taking things.
Finally, let’s review Token2049. In the past, there were institutions everywhere and VCs were like dogs, but now they are hardly seen. The various exchanges that prospered for a long period of time have almost disappeared, except for a few well-known big exchanges. The remaining ones are all Dex, especially Dex on L2, among which the San Brothers team is the main force. In the past, attending conferences could get you soft hands, but now besides promotional materials, you only get power banks. There are fewer and fewer discussions about building, and these days, everyone around me is only concerned about whether there will be another bull market, and whether BTC will rise. Even those who work on public chains are the same. The only industry that is diligent and conscientious is the various exchanges, and they can really deliver.
Easter egg: I was chatting with a girl I’ve known since 2018, and she said the most talked about project in Singapore this time is RWA. Overnight, everyone is laying out their plans for RWA, and everyone is an expert in RWA. But unfortunately, the vast majority of people don’t even know that RWA needs to be compliant. Even STOs require licenses, but RWA can just run wild? However, what can be determined is that RWA is the next form of DeFi, and it is very likely that RWA will be the driving force in the next cycle.
Summary: When it’s dry, it’s extremely dry; when it’s rainy, it’s extremely rainy. Those who have money want people, and those who have people lack money. The crows caw every day, and radishes grow everywhere.
About RWA
Yu Jianing @UwebDrYu
1. RWA refers to tangible or intangible assets that exist outside of the blockchain or digital environment;
2. The reliable valuation brought by compliance/authenticity/legality is the core of RWA business;
3. In the mature future of RWA, we can foresee a collaborative ecosystem involving multiple stakeholders;
4. The combination of RWA and DeFi will create scenarios similar to traditional financial instruments such as ABS/REITs;
5. The RWA model is proof of industry maturity.
About ETFs and Regulation
Evgeny Gaevoy, Co-founder of Wintermute Trading
To some extent, the approval of spot Bitcoin ETFs is inevitable and predictable. However, it will take at least six months to start seeing capital flow into these products, and a more realistic timeline is one to two years. But compared to the position six years ago when cryptocurrencies were not welcomed by institutions, the current traditional financial institutions, family offices, and funds have all become our counterparties. This is a clear shift in the perception of cryptocurrencies being seen as legitimate entities.
Franklin Templeton CEO Jenny Johnson
Although Franklin Templeton has applied for a Bitcoin ETF, Bitcoin ETF is still a traditional ETF that cannot be traded throughout the day on the trading platform. In fact, it is only priced twice a day. Cryptocurrencies, on the other hand, are different. They can be traded 24/7, and smart contracts can ensure accurate understanding of the pricing of underlying assets during transactions. In addition, Bitcoin may be difficult to invest in because governments always have control over their currencies. If Bitcoin threatens the currency, it will be regulated and prohibited.
Temasek Managing Director Pradyumna Agrawal
In different markets, there are similar focuses on protecting retail investors and retail investor protection. Currently, many regulatory actions are happening in the United States, and many people are also paying attention to the United States. In this region, the participation of institutions is very critical. Singapore, Hong Kong, the Middle East, and other regions have already formulated corresponding regulatory policies.
Galaxy Managing Director Chris Rhine
There are differences in regulatory directions between the East and the West in the field of cryptocurrencies, which is related to the strong regulatory measures currently adopted by the United States. At the same time, the US regulatory actions have spillover effects, and other regions closely cooperating with the United States will also be cautious accordingly. In this context, large-scale institutional investments are very cautious because the trial and error risks of institutions are still too high. In addition, liquidity in the tokenization market remains a hindrance.
Ripple CEO Brad Garlinghouse
The United States is one of the worst places to start a cryptocurrency startup. The only country that discourages people from starting cryptocurrency companies is the United States. I hope the United States can learn from the practices of countries such as Singapore, the United Kingdom, the United Arab Emirates, and Switzerland, formulate policies, encourage cryptographic innovation, and protect consumers. But if we want this industry to thrive and achieve the goal of fundamentally reshaping the operation of the financial infrastructure, we cannot pretend that government regulation is irrelevant. The cryptocurrency community needs to reach consensus on certain basic regulations.
Binance Founder and CEO Changpeng Zhao
The key issue in the cryptocurrency industry lies in the fiat currency deposit and withdrawal channels. At the beginning of this year, many banks and traditional financial institutions withdrew from the OTC market due to regulatory policies. The global adoption rate of the Internet is only about 60%, but people believe that everyone uses the Internet, and cryptocurrencies do not need to be adopted by 100%. The cryptocurrency industry is currently very close to a 5% to 10% adoption rate and is on the edge of exponential growth. The cryptocurrency industry can bring tens of millions or even hundreds of millions of users to these traditional financial institutions. Many banks and traditional financial institutions want to seize this opportunity. In order to bring more users into the cryptocurrency world, the exchange channel between fiat currency and cryptocurrencies must be established.
About AI
Alex Blania, co-founder and CEO of Tools for Humanity, the parent company of Worldcoin
Currently, Worldcoin still relies on third-party manufacturers for hardware production, which is a key area of focus within our engineering department. Over the next few years, we will achieve a truly meaningful decentralization and completely relinquish control within the next five to ten years.
Sam Altman, co-founder of Worldcoin
Worldcoin’s scanning devices are expected to release a new version every two years with better security and imaging capabilities. To achieve mainstream adoption, cryptocurrencies need to be more user-friendly, suitable for important use cases, and subject to clearer regulations. The two biggest obstacles for Worldcoin currently are operational challenges and biometric resistance.
Arthur Hayes, co-founder and former CEO of BitMEX
AI has the potential to create trillions of dollars in value. Chat GPT has been a major highlight in the past six months and is the fastest-adopted technology in human history. Currently, the biggest stock in AI is NVIDIA, whose stock price has almost doubled since the launch of its consumer products. NVIDIA’s P/E ratio has reached 100, which is undoubtedly a bubble. Fundamentally, artificial intelligence does not care about human laws and regulations, making it almost impossible for a single government to unilaterally punish AI. The bull market in fiat currencies and the technology industry will lead to the next cryptocurrency boom. The next bull market in early 2024 will be the biggest bull market for cryptocurrencies and risk assets since the end of World War II and the Great Depression.
About Play-to-Earn Games
Robbie Ferguson, co-founder of ImmutableX
Web3 games have received significant investment and have enough capital to develop high-quality games. However, unlike DeFi projects that can start producing partial products within a month after receiving $100 million in funding, game development usually takes 2 to 4 years and sometimes even 6 to 7 years. We believe that 40% to 50% of games will go live next year, but 90% of them will fail. However, the successful 10% or 5% will completely redefine the entire industry and generate transaction volumes that surpass the sum of other games.
Aleksander Leonard Larsen, co-founder of Axie Infinity
The business model in the Web3 gaming sector needs more innovation and experimentation. Web3 requires a large number of games to be quickly launched, and games should focus more on core experiences rather than spending enormous amounts on marketing. Collaboration with studios that share similar philosophies is also a key focus for Axie currently, as it helps iterate the game faster. Focusing too much on the next top game may be just to please the crypto social media rather than focusing on actual users. The success of games like “Candy Crush” inspires the importance of multi-user acquisition and innovation in Web3 games.
About BTC
Tangent Co-founder Darryl Wang
Cryptocurrency is a very responsive asset class, but the halving itself is not enough to ensure a bull market. What’s more important is the current price and the objective macroeconomic conditions when the halving occurs. As cryptocurrencies continue to mature, this asset class will align with a broader range of risk assets, so the halving effect may weaken over time. However, 2024 will be a very interesting year, especially when it comes to partisan issues involving the dominant flow of institutional funds in the United States.
Selini Capital CIO Jordi Alexander
Despite occasional government sales, Bitcoin and Ethereum still appear to be very cheap in the long run compared to gold or other large-scale assets when viewed as global macro assets. However, liquidity issues, FDV, and market capitalization are important fundamentals that projects need to consider.
About Stablecoins
Castle Island Venture Partner Nic Carter
1. USD stablecoins will occupy 95% of the market share;
2. Within two years, more than 30% of stablecoins will be interest-bearing stablecoins;
3. Within two years, more than 25% of USD stablecoins will be crypto-backed stablecoins;
4. More than 70% of on-chain transactions are stablecoin transactions;
5. Singapore, Hong Kong, the United Arab Emirates, Bermuda, and other regions will become major jurisdictions for issuing USD stablecoins.
*Guest opinions are sourced from Blockbeat, Jinse, personal Twitter accounts, and other external websites, with deletions and modifications.
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