In an exclusive interview with Cryptonews, William Quigley, the co-founder and CEO of decentralized blockchain WAX and co-founder of USDT issuer Tether, shared his insights on the crypto and blockchain industry’s future amid recent challenges.
Quigley, who has over 30 years of experience in technology and finance, remains optimistic about the sector’s recovery, emphasizing the need for patience as the industry finds its footing once again.
Recent Struggles and a Short-Term Memory
The crypto sector has faced several obstacles in 2022 and 2023, including market declines, company collapses, scandals, and regulatory scrutiny.
However, Quigley believes that recovery is possible due to a very human reason: people’s short-term memory.
He stated that the global marketplace’s participants tend to quickly forget earth-shattering news and events, which could play a significant role in the industry’s rebound.
Quigley compared the current crypto landscape to the early days of the internet bubble.
From 1995 to 2000, he witnessed a frenzy that was “1,000 times more than what crypto was in 2021.”
According to Quigley, it was “just insane” how people believed that if they weren’t involved in the internet, it would spell their doom.
However, a series of events, including the collapse of the internet bubble, the Telecoms crash, 9/11, and financial fraud, led to a significant loss of interest in internet-related ventures.
“And I tell a lot of younger people something that I think they sort of don’t believe me, but it is true. I can prove to you this is true. In 2001, 2002, and 2003, the one area on the planet that Wall Street venture capitalists thought was a toxic wasteland was any business connected to something called the Internet.”
However, as companies like Facebook and YouTube emerged and the landscape gradually shifted, venture capitalists returned their attention to the internet by late 2010.
Looking Ahead with Confidence
Despite the setbacks experienced by the crypto and blockchain industry, Quigley argues that these challenges are relatively minor compared to the internet’s past struggles.
He remains confident in the sector’s ability to recover and evolve over time, urging patience and optimism as the industry navigates through current obstacles.
As the interview concluded, it became clear that Quigley’s extensive experience and knowledge lend credibility to his optimistic outlook.
While it is crucial to acknowledge the hurdles faced by the crypto and blockchain sector, the industry’s potential for a resurgence should not be underestimated.
Advice from the Internet to blockchain: Hurry up
Quigley noted a saying: “Never let a crisis go to waste.” When the FTX exchange collapsed, causing significant damage to its users, it presented a perfect opportunity for federal groups in the United States to argue, “Oh, see, this is what happens when it’s not regulated.”
Consequently, they began to take aggressive action.
The US Securities and Exchange Commission (SEC) effectively banned third parties from marketing staking services to the retail community in the US, at least.
Quigley expressed his disagreement with this approach, stating, “I think that’s such a misguided idea.”
Ethereum Staking and the Accredited Investor Problem
Quigley argued that Ethereum staking is complicated, but it’s essential to encourage people to deploy their assets in a way that strengthens the network. Since an average person often can’t do this themselves, it would make sense for an aggregator to do it for them for a nominal amount.
The problem lies in the fact that people with a lot of ETH can stake themselves, as can “the big institutional guys” who are registered with government agencies.
However, in the United States, poor and modestly wealthy people are “prohibited from participating in a profitable enterprise.”
Quigley pointed out the concept of the ‘accredited investor’, which allows only wealthy individuals to participate in better investments.
“Literally, it’s a law. It’s like only wealthy people are allowed to participate in these attractive investments.”
Lessons from the Internet and the Danger of New Technologies
Quigley noted that the example of the Internet is very instructive. He explained that during the early days of the Internet, powerful business and government interests were ignorant, apathetic, and disinterested.
They didn’t foresee the massive impact that online entities would have on various industries.
Quigley added, “And I look at it now, and I think that if all of those business interests knew what the Internet was going to allow others to do, the Internet would have been either outlawed or would have been immediately treated as a regulated communications industry, like cable companies.”
Businesses have since learned from the music, newspaper, and retail industries. A generation of capitalists now sees new technologies as dangerous.
Quigley said, “When you see a new technology, the first thing you do is you go to the government and you outlaw it.”
The Importance of Stablecoins and NFTs
Quigley believes that one of the great inventions of the 21st century is the tokenization of fiat, with stablecoins being “so spectacularly valuable [and] there should be 1,000s of them.”
He emphasized the importance of speed in the industry, using Uber as an example. Had Uber taken off more slowly, it would have been regulated out of existence.
“The transportation industry was too slow to identify the effects of Uber. And it is only because the people of the United States started to truly see the value of it that Uber survived. But had it taken off a little slower, Uber would have been regulated out of existence.”
To ensure the success of the blockchain industry, Quigley recommends two things:
- making sure the industry takes off as fast as possible and getting as many people as possible to enjoy its benefits
- form a strong grassroots movement.
“The ability, the flexibility you give to a new class of entrepreneurs when they’ve introduced a new platform is overwhelming when it is rapidly introduced and appreciated by the people,”
Quigley said. “Once that happens, the tyrants and governments have an extraordinarily difficult time shutting it down.”
But there is a warning when it comes to blockchain: when a technology is introduced more slowly, when it’s harder for people to understand and use it, bad actors have more time to kill it. This is what blockchain struggles with because it’s a very abstract concept.
That’s where non-fungible tokens come in.
Quigley argued that the best thing that happened to blockchain from a mass market standpoint is non-fungible tokens (NFTs). Thanks to the “pretty pictures,” more people were able to understand and use it.
However, that came with a few negatives, such as the issue of NFTs’ effect on the climate and people presuming that blockchains are only useful for pretty pictures.
Adoption is ongoing progress.
Quigley describes himself as “a thematic investor” who looks at either a market or a technology platform and how specifically it can be used. We’re at a point in blockchain where it’s not a good idea to be a generalist blockchain investor, and it’s better to go “narrow,” he argued.
Some of the areas he is particularly interested in are infrastructure services (both from the demand standpoint and the perspective of unhindered access), as well as decentralized finance (DeFi) and “one of the three legs DeFi rests on” – stablecoins.
Quigley goes even further and focuses on the ways to distribute work for areas essential to the technology world, saying that what fundamentally made Bitcoin so powerful is this “marvelous way to distribute work by compensating people in a decentralized way for providing support for a platform.”
Therefore, he said,
“I would rather have maintained by a decentralized workforce than a giant company that has all kinds of weird political views that it wants to impose on the rest.”
Quigley concluded that the best way to support a community is by highlighting a particular aspect or capability and “encouraging people to use their imagination:.
When we simply tell people what to do, we take away their opportunity to think deeply about a subject and come up with their own ideas or solutions.
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