In his monthly crypto tech column, Israeli serial entrepreneur Ariel Shapira covers emerging technologies in cryptocurrency, decentralized finance (DeFi), and blockchain, as well as their role in shaping the 21st century economy.

The posthumous consensus on the crypto market crash among industry leaders from Polygon co-founder Mihailo Bjelic to crypto billionaire investor Mark Cuban, is that bear markets are a healthy way to cleanse the market. The latter even pointed to a line longtime crypto critic Warren Buffett used to voice his opinion on the matter.

“Only when the tide goes out do you find out who has been swimming naked.”
Of course, no one in the industry will dispute the claim that bear markets shed the weak, or the corrupt naked in this case. But it would be a mistake to leave the analysis at that as if more than $700 billion was wiped out overnight is something we must continue to accept from the cryptocurrency markets. It is important to understand the key factors in this recent uptrend that led to its massive demise, and how to foster a more stable market going forward.

NFTs: grace or past?
We are still five years away from the first massive crypto crash that was spurred by the popular initial coin offering (ICO) boom of 2017. With the industry still in its infancy, most of the projects that emerged during this period and led the investment were random coins claiming to be Be the next Bitcoin (BTC). The industry has evolved quite a bit since then, and this time around, other applications of the blockchain have led the way.

So, what is the latest version of scam ICOs? Several factors contributed to the recent market boom that pushed Bitcoin to nearly $70,000 per coin. But perhaps most similar in substance – yet often more ridiculous – to last year’s ICOs were Non-Fungible Tokens (NFT), a market that reached $25 billion in 2021. The industry may have reached a peak The hype was when Bored’s NFTs Ape Yacht Club (BAYC) group sold hundreds of thousands – and later millions – of dollars in Ether (ETH). Celebrities, as well as industry icons like Adidas, Coachella, and even the Super Bowl participated.

Related: Beyond the hype: NFT could lead the way in transforming business experiences

Then it all went south when everyone found out that over 80% of the NFTs created for free on OpenSea were either scams or scams. The cash grab culture was fully displayed in person at an NFT.NYC event in late June.

However, it’s not as if many in the crypto space would deny that the technology behind NFTs will redefine ownership and play a major role in Web3. But how can we move into that future without SAMS getting into the arms of innovation?

It is actually quite obvious. The way forward for NFTs and the technology behind them is to connect them to desired physical assets and harness their ability to authenticate and secure products.

For example, companies in the luxury goods industry have been exploring the use of NFTs as a way to combat the spread of counterfeit goods. Projects like the Aura Blockchain Consortium, chaired by luxury giants LVMH and Prada Group, leverage the power of NFT technology for product authentication, supply chain transparency, and data ownership for their physical products.

It’s not necessarily about selling a digital sneaker but improving the product and brand experience for their affluent customers. Jewelery company Yvel, for example, launched a stock trading platform tied to luxury jewelry and precious metals as collateral — in effect linking NFTs to tangible products rather than JPEGS.

Related Topics: NFT 2.0: The Next Generation of NFTs Will Be Streamlined and Trustworthy

The Greenest Pastures in Blockchain
Surviving the bear market is not only imperative for NFTs, but also for more foundational crypto assets — which, by the way, hasn’t fully corrected their tendency toward scams either. The collapse of the algorithmic stablecoin is likely to cause a serious aversion for ordinary owners and businesses to meaningfully explore how to tie cryptocurrencies to traditional assets, but that doesn’t mean all hope is lost. The path forward here really is to focus on creating a product that meets a real and tangible market need – not unlike a solution to the NFT market crash.

Related: What can other algorithmic stablecoins learn from the Terra crash?

This is something we’ve all heard before. So how do we get there purposefully this time around? It all comes back to business basics. To thrive, startups need to find a problem to try to solve, and that problem can’t be simply that the founder isn’t wealthy enough. So, what sectors can meaningful coins focus on?

Minimizing environmental impact and operating sustainably has long been a white whale for crypto and blockchain projects. A frequent criticism of cryptocurrencies and the blockchain as a whole is that they cause massive harm to e

Source: CoinTelegraph