Crypto industry “healthier” than what market prices indicate: a16z report
Andreessen Horowitz (a16z) has released its second edition of the State of Crypto report.
According to the venture capital firm, the crypto industry has steadily grown over the years, even as prices flactuate.
a16z has also unveiled the “State of Crypto Index,” a tool to help track the health of the crypto industry.
Andreessen Horowitz (a16z), a leading venture capital firm that backs some of the best projects in the emerging technologies industry, has released its latest “State of Crypto report”.
The report also notes that cryptocurrency prices have been characterised by periods of massive gains and then crypto winters. Commeting on this, a16z researchers Daren Matsuoka, Eddy Lazzarin, Robert Hackett and Stephanie Zinn wrote:
“In the period marked by our now-annual State of Crypto report, it would be easy for a casual observer to overlook the rapid progress the crypto industry is making. Major infrastructure improvements like The Merge – a momentous achievement in decentralized and open source development – simply don’t make headlines as often as high-profile bankruptcies, busts, and flameouts.”
Crypto “healthier” than the story prices tell
a16z’s second report comes after a period of turbulence for crypto in 2022, with the collapse of cryptocurrency exchange FTX the low point for the industry in terms of its impact as a setback.
Crypto prices tumbled towards the end of the year before making a decent recovery in the first quarter of 2023. Of this aspect, the Andreessen Horowitz report says it is easy to miss the point when it comes to overall development across the industry.
In particular, the researchers highlight Web3 technology at the latest intersection of this trajectory.
“Our 2023 report aims to address the imbalance between the noise of fleeting price movements – and the data that tracks the signals that matter, including the durable progress of web3 technology. Overall, the report reflects a healthier industry than market prices may indicate, and a steady cycle of development, product launches, and ongoing innovation,” the report states.
a16z also announced the “State of Crypto Index,” which it says is an interactive tool that will help people “track the health of the crypto industry.” According to the VC firm, the tool focuses on innovation and technological advances, rather than on the financial aspect of the industry.
The index will provide a nuanced measure of what crypto development entails, looking at 14 industry metrics, including total verified smart contracts, active addresses, DEX volume, transacting wallets and active developers among others.
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