After communicating with our community and taking the current climate into consideration, we think it’s time to discuss the current state of the market and the implications it may have. Although this topic may cause a stir among many newcomers or industry observers, I think it is important to express my point of view. Consider this piece as me having a bit of fun with the bear market.

What is a bear market?

Before we start the discussion, it’s imperative to analyze the origin of the bear market.

First of all, the basic principles of economics tell us that peaks are always accompanied by troughs. In simple terms, a rise will be followed by a drop and vice versa.

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Therefore, with the unprecedented high points seen in the early stages of the industry (the bull market), it seems natural to see the lows of the current bear market.

Why does a bear market occur?

Diving deeper, I believe that the current bear market is an inevitable result of prices being driven up artificially by certain stakeholders in the market as well as investors blindly following suit. Taking my personal experience in joining the blockchain industry from the “chives” (a term popular in China for those who were trapped in the loop of speculative investments) into account, I remember thinking that blockchain is a versatile technology. I believe that many others share the same understanding. But today I wonder how many people are able to explain what the blockchain is and to answer the following questions:

What problems can the blockchain solve? Is it an indispensable part of the present and future life? Can blockchain technology really help our work and life? How much do you know about investment projects? I.e. How many people are there in the project’s core team? What problems do they want to solve? What problems can they solve? Will it be profitable? What percentage of returns will the project use for investment?

When these questions occur to a larger percentage of the market, the lows of a bear market are bound to occur. However, it is important to keep in mind that this is from the perspective of individual investors, where funds are limited and reasons for investing have different origins. Because of this, opting out would seem to be logical when confidence is low.

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Other factors to consider

Following on, it is important to consider external funding as a cause. Many people heard voices from the media and KOLs that market liquidity is insufficient, and external funds cannot come in, etc. Most of the external funds are in the hands of teams with strong resource reserves. Whether they enter the market depends on various factors, such as analysis reports. These analysis reports contain a multitude of factors, but they do not consider rumors heard by individual investors. Therefore, when they lack the data to support entering the market or question the outcome of projects in the industry, they tend to stop to wait and see. For example, they may wait for a moment when the value of BTC is close to or equal to their expected performance or when there is a breakthrough in technology or product. Imagine if you have hundreds of millions or even billions of dollars, would you be willing to invest in an industry that seems to be all about clubbing, traveling, and hosting conferences?

In summary, the current bear market is:

an inevitable result of macroeconomics; a result of artificial demand caused by fake projects that do not push the industry forward (so when you see more public chains than actual technical products and more exchanges than projects, this may be the case); a result of self-awareness and self-evolution whereby the industry is stuck in the state of reaction and attracting traditional and external resources is difficult.

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Why might the bear market be good for blockchain?

You might be wondering why am I treating this bear market as a big plus. Because, finally, investors have the time and motivation to think more rationally and read more articles, much like the one you are reading right now. My thinking is that the current market is returning to rationality. I will leave it to you to judge whether I am exaggerating or telling the truth. My main reasoning stems from the idea that investors in the market will no longer follow influential people or popular news blindly.

Only when we see investors return to rationality can quality projects enjoy a broader space to thrive. You might be thinking that quality projects will shine regardless but, if we’re being honest, the reason why most investors enter the market is to make money, and when it comes to investors making money, quality may not always be the highest priority. If this persists in the long-term, we may see the worst-case scenario; an industry full of “plastic” projects causing blockchain to fall, much like VR technology. Of course, this may not be a worry for individuals investing in the short-term.

Adding to this, we still see many teams taking a back-seat and “waiting for the wind to come.” In fact, many teams have no other choice as a result of a lack of technological innovation.

Bringing Ontology into the picture: what we do is not solely for ourselves. We are doing everything we can to reunite the consensus that is exclusive to blockchain technology. We strongly believe we must make full use of the true strength of the technology, products, and team, so that more people believe and see what Ontology, better yet the entire blockchain industry, can bring to everyone. When others are having fun, we are searching for partners around the world to better understanding the international market; when others are on vacation, we use our time to spread understanding of blockchain at many of the world’s top universities. As others “wait for the wind to come”, we push our technology forward by growing our community of global developers and partners.

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What Ontology is doing is keeping a low profile and preparing for when the wind stops. In preparing, we are developing powerful wings ready to soar when the moment is right. Perhaps in the last bull market, Ontology did not soar, but, in the next bull market, Ontology, with all powers accumulated and the wind on our side, will likely soar up into the sky.

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To end, I would like to explain that, when I mentioned that the bear market might be a favorable period for the future, it only applies to certain projects. Artificial demand and “plastic” projects will continue to exist and still may be the choice of some investors. But for us, for now, building a true consensus and allowing the community to propel the project forward is the core. I truly believe that, with the power of Ontology’s global community (which covers 19 different languages), we will produce a butterfly effect for the whole industry, leading the industry out of the bear market and moving it towards a brighter future.

Want to see another topic covered? Comment below and let us know what you would like to see next. We look forward to more interesting discussions with you.