It’s been a rough few months for crypto following the collapse of Terra in May, sending shockwaves throughout the wider market. But crypto prices had been trickling down for months at that point, and financial markets across the board have been hit hard this year as inflation rises.
How much longer will the bear market last? Estimates vary widely, but many in the crypto space don’t believe that we’ll see another bull run anytime soon. And you can count Solana co-founder Anatoly Yakovenko among them.
On the latest episode of Decrypt’s gm podcast, Yakovenko pointed to continued pain in the markets for some time to come, citing the impact of the U.S. Federal Reserve’s ongoing rate hikes. But Yakovenko also told co-hosts Dan Roberts and Stacy Elliott that he’s optimistic about an eventual return to crypto market growth
“Looking at macro stuff, my guess is there's probably 12 to 18 months more of this brutal Fed rates going up,” he said. “But there is an end to it. And just like the last bear market, a lot of teams that built and focused on product-market fit, and really tried to build amazing products—a lot of those succeeded, I think, in a very dramatic way.”
Solana has been no exception to the wider crypto market decline, with the price of SOL down 81% since the start of 2022 per data from CoinGecko. The layer-1 blockchain network has also suffered three significant periods of downtime this year, including one last week, which Yakovenko addressed in the episode.
But Solana has also seen growth and continuing momentum despite the macro decline and technical hitches. Solana’s NFT market is still growing despite the lower price of SOL and declining value of some collectibles, plus new projects are steadily being built on the network. Yakovenko also pointed to Solana startups that are raising funds at “still pretty high valuations” despite the crypto winter.
His comments come ahead of Solana’s annual Breakpoint conference in Lisbon, Portugal in early November. After debuting last year, Breakpoint is already considered by some to be a fixture on the Web3 conference circuit. Yakovenko sees the event as an opportunity to take stock of everything in the Solana ecosystem over the last year: the good, the bad, and the ugly.
“We call it Breakpoint because it's kind of a break,” he said with a laugh. “But I think that's important—to take a break and then look back at what we accomplished, what the challenges were over the last year, and really reenergize everyone to continue building.”
Asked if he expects a different vibe for this year’s Breakpoint compared to the 2021 debut, during a time in which the price of SOL was soaring to new heights, Yakovenko replied (again with a laugh), “Are people going to be depressed and somber? I don’t know, honestly.”
He observed that “people are still having fun” when at the Solana Spaces store or at Solana’s dev-centric Hacker Houses events, and wondered aloud whether that resilient attitude is due to builders having already lived through multiple crypto market cycles.
“They're like: ‘Well, here we go again. We might as well make the best of it,’” Yakovenko said. “So they tend to have a pretty good attitude about it.”
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