Can Crypto Disappear Forever? | Is it Possible at All? (2023)

Can crypto disappear? That's the question on everybody's lips after Bitcoin fell to its lowest level in 18 months — losing the psychologically significant level of $20,000. To make matters worse, the total market cap of all cryptocurrencies has plunged by more than $2 trillion since November 2021… with some altcoins down 90%.

A (tongue in cheek) website called bitcoinisdead.org has been dutifully compiling so-called BTC “obituaries” for several years now, where major news outlets declare that the digital asset’s best days are over. But on countless occasions, confident predictions of Bitcoin heading to $0 have been followed by new all-time highs a few years later.

When it comes to the matter of will crypto disappear, answers vary depending on who you ask. Sceptics of digital assets tend to argue it’s only a matter of time before the industry implodes. And as you’d expect, impassioned believers maintain that new heights will be reached when the next bull market comes along.

What can cause crypto to crash? For an example, look no further than the multi-billion-dollar collapse of the Terra blockchain. This provided compelling proof that even the biggest cryptocurrencies can vanish in a matter of days. LUNA, once a top 10 altcoin with a market cap of $40bn, entered into a death spiral in May — with the token’s price falling from highs of $119 to crushing lows of $0.00001675 in just six weeks.

For so-called “Bitcoin maximalists”, those who believe in the value of BTC and nothing else, this was a moment of vindication. They argue most, if not all, altcoins are worthless – and they are inferior to the world’s biggest cryptocurrency in almost every way. Some had been trying to warn investors about LUNA long before its messy demise.

This has led some in the space to stress there’s a clear distinction between Bitcoin and cryptocurrencies – insisting that the two must not be conflated.

Samson Mow is an entrepreneur who recently started a company called JAN3 in his quest to encourage nation-state Bitcoin adoption. And he has played an instrumental role in El Salvador’s ambitious embrace of BTC as legal tender.

He told Currency.com: “Crypto could disappear forever because crypto is just centralised projects creating tokens and coins at will. There are over 20,000 crypto projects now and most are pointless.

“Bitcoin, however, will not go away, because it is actually decentralised and it is still very much in demand as a replacement for legacy money by individuals, corporations, and nation states.” Samson Mow, CEO, JAN3

Mow has a point here, with so-called meme coins popping up all the time. Just hours after Will Smith slapped Chris Rock at the Oscars, a token called Will Smith Inu was born. The token was a flash in the pan – rising and falling in the blink of an eye – and it shows just how easy it can be to launch a digital asset.

Can crypto lose all value?

David Gerard is a crypto critic and author who closely covers the excesses, wrongdoings and scams in this often opaque industry. He told Currency.com: “I think it’s obvious that Bitcoin and crypto will be around for decades.

“All you need is the software, the blockchain data, and two or more enthusiasts.” David Gerard, crypto critic and author

For him, the pressing question is whether crypto will be an interesting financial instrument in the months and years to come.

“The original use case for Bitcoin was money outside government scrutiny,” added Gerard. “And even now, avoiding government scrutiny is crypto’s main use case. This isn’t always wrong – governments can be annoying and incorrect in their behaviour. But that’s not really sustainable as a use case.”

With ever-closer ties being forged between cryptocurrencies and financial institutions, Gerard believes regulation will increase. “When you touch real money, you’re expected to play by the rules of real money. That shouldn’t surprise anyone,” he explained.

Gerard says cryptocurrencies will always have a market price of some sort for as long as they can be owned as property. When it comes to whether these assets will disappear, he added: “If being kicked out of actual finance counts as ‘disappearing’, I think that should be considered possible. I don't think it's likely. I expect only ever-increasing constraint. But it’s not impossible.”

Crypto is here to stay

Alice Liu, head of research at CoinMarketCap, told Currency.com: “Crypto is here to stay. This will be a gloomy, but arguably the most optimistic crypto bear market we will have experienced.”

She argues that the industry has matured substantially since 2018, with funding from venture capital firms increasing by $37bn in the past two years alone. This is three-and-a-half times higher than the previous five years combined.

Liu said: “If we look at institutional adoption, crypto has now been incorporated by large platforms into areas such as capital markets, trade and e-commerce, government and public sectors with demonstrable real-life use cases.

“As this continues to grow, crypto is only here to stay.” Alice Liu, head of research, CoinMarketCap

Amy Castor, an independent reporter covering crypto and NFTs, told Currency.com BTC has gone through several bubbles – but it and many other coins won’t disappear any time soon. Nonetheless, she claimed Tether is the industry’s Achilles heel. Although the stablecoin issuer has long insisted that it has enough capital in reserve to cover all of the USDT in circulation, there’s scepticism in some circles as to whether this is the case.

“If the US Department of Justice comes down on Tether – something we’ve been waiting for since 2017 – Bitcoin will see lows it hasn't seen in a long time. But it won't go away,” said Castor.

Like Gerard, Castor believes regulation is crucial to clamp down on “new grifts” designed to entice retail investors – citing initial coin offerings, decentralised finance (DeFi), non-fungible tokens (NFTs) and play-to-earn games as examples. Of course, enthusiasts would challenge this, and assert DeFi and NFTs will endure.

FAQs

Further reading