Stable Crypto-Corns – The New NFT For India

BloombergQuint was kind enough to invite me to express my thoughts on cryptocurrency… as I took some time to reflect, research and put together some coherent words, the world had moved on and suddenly India is producing unicorns like they are growing on trees. This became the new topic of choice. The process of thinking about both of these led me to a different topic – the need for stability. This point actually underlies the challenge I see with both cryptocurrency and unicorns; but more on that later.

Still An Asset, Not Yet Currency

First, let’s talk about bitcoin. To talk about bitcoin, we need to first accept some basic principles about money as we know it.

One – money is really useful. You can buy things with it. Before it, we lived in a barter world, which was very difficult to manage (“that’ll be 4 rabbits for a boar”).

Two – it’s a tool for governing. Economies are an integral part of society (“It’s the economy, stupid”) and politicians know this. Money is a key tool that governments use to manage the economy. It is debatable as to whether they do a good job with it or not, but it is a tool that they loathe to give up.

Three – it’s a measure of success. Everyone uses money and sees it as a measure of progress in their lives.

Given these three realities, removing money from our daily lives is going to be a task. Given the extreme volatility in crypto today, it will be hard to see it as a useful tool to buy things.

Crypto value is either increasing or decreasing with such large swings that pricing real-world products with it is more art than science.

And when it does, there will be a massive thud and a big hangover will ensue. Investors and entrepreneurs will act like they never thought it was possible. Some funds will die, some entrepreneurs will shut shop and some mythical characters will return to their fairy tale novels. But the real problem arises when those that were watching the party from the outside (and in many cases funding it for option value), will begin to believe that India is too risky and lacks stability. We will be stuck in a dry spell, or a cold winter, for a while.

This is the circle of life for those born into the jungle of the unicorns. While we may want to talk about cryptocurrencies or flying horses, we should focus on finding stability through sustainable exponential growth. Everything else is noise… it’s really fun, attractive, entertaining noise, but it’s still noise and we should recognise it for what it is. Acknowledge that it has an important role to play, but return our focus to the businesses that are creating real customer value through hard product differentiation. I hope I get invited back to talk more about that.

Sandeep Murthy is Partner at Lightbox, a venture capital firm that makes investments in early-stage consumer technology businesses based in India.

The views expressed here are those of the author’s and do not necessarily represent the views of BloombergQuint or its editorial team.

PUBLISHED BY– Bloombergquint


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