Token2049: Recklessness applauded, regulation shunned

Last year’s Token2049 conference in Singapore landed just three months after the crashes of TerraLabs and Three Arrows Capital. There wasn’t enough time to figure out if the chaos of cascading insolvencies caused by their collapses was even over – it wasn’t – let alone conduct a proper post-mortem of why they happened.

This year’s conference has had time to reflect and to understand the financial and reputational damages that the crypto industry has experienced. Speakers were sure to address how the sector could move forward sustainably and talk about ways to reestablish trust with investors.

Right?

Photo credit: OKX

If the first day of the conference was any indication, none of those were on the speakers’ minds. I spent most of Tuesday at the conference’s main stage listening to people speak disparagingly of regulations, regulators, and central banks. The only other topic that rallied as much applause were predictions of a new bull market.

It was almost as if 2022 never happened.

Style over substance on center stage

Here are some examples:

Arthur Hayes, the co-founder and former CEO of crypto exchange Bitmex, told the audience how the US government, unable to meet repayments on debt maturing in 2026, would start printing more money (thereby devaluing the country’s currency) in order to avoid defaulting. He claims this would be driven by a lack of demand for US treasures.

To be fair, Hayes’ opinion deals with some very real issues, but I would argue that nothing past the words “US government” is accurate. That didn’t stop him from predicting that this scenario would prompt a bull run in crypto next year.

That, of course, became the headline. No one covered the possibility that Hayes was wrong, likely because that would require a knowledge of monetary policy that many journalists covering crypto don’t have. Headlines promising better economic conditions are much easier to push.

Arthur Hayes, the co-founder and former CEO of crypto exchange Bitmex, on stage at Token2049 on Wednesday.

When dealing with crypto investors, a conspiratorial disregard for monetary policies has always been preferable to a nuanced discussion of reality.

Then there was Daniel Alegre of Yuga Labs, former president and COO of Activision Blizzard, who made an indignant quip about the possibility of people going to jail “just for playing a game.”

Making sense on the sidelines