Crypto? Have I missed the train?

Cherry Peaks
Nov 6 · 2 min read

It is not too late!

Gartner’s Hype Curve was developed by Gartner consulting firm to analyze technology hypes. Cherry Peaks believes this five-phase cycle can be used to explain the crypto market evolution (for more detail and information on Gartner’s curve please visit the author’s website).

Gartner Hype Cycle
Gartner Hype Cycle

After some years of being a niche technology adopted by few tech savvies, Blockchain’s potential caught the attention of many developers globally. These developers started innumerable projects and ICOs looking to disrupt every single industry. (Phase 1; Innovation Trigger). As these projects required funding for development, promoters started marketing campaigns that quickly got media attention, soaking all major papers.

It was a global phenomenon. (Phase 2; Peak of Inflated Expectations). And when? When the technology was still at its infant phase. People did not truly understand it, but they had an accessible direct way to make a bet into it. In contrast with the early development of Internet, which had to be financed by limited and inaccessible VC investment, Blockchain had a public and traded instrument since inception. Investors were able to enter the technology while the whole World could monitor its price and development. And where? In a market that had a total market capitalization below 300Bn USD (vs. Apple’s 1T USD or Amazon’s 1T USD). The media coverage was disproportionate, not only compared to its market size, but compared with the technology progress underlying that market.

The technology wasn’t yet ready to fulfil investors’ expectations, and quickly became a fact; Over 90% of the ICOs failed. Some couldn’t retain investors, others were hacked, and many others were fraudulent. The market, together with its expectations, collapsed. (Phase 4; Trough of Disillusionment).

We have crossed that trough and the industry is now facing its harder (but most promising) long-term phase. (Phase 5; Slope of Enlightenment). The technology must overcome investor’s memory; the past overselling and scams. Once it regains confidence, slightly supported by new funding, developers will be able to deploy real solutions. Investors should recognize that, despite from price declines, the technology progress has never stopped, and Blockchain is now starting to climb the Slope of Enlightenment that will set the basis for grounded long-term outsized returns.

At this point, is highly likely that Blockchain and cryptoassets are here to stay, and we are entering its most promising phases. Investors can either embrace it, or ignore this long-term investment opportunity.

Cherry Peaks

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Operational consulting and tailored solutions for institutional investors and HNWI willing to invest in cryptoassets through optimised processes

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