Crypto market getting closer to 'regulatory certainty': Expert

DOHA, Qatar

The global trend is positive for cryptocurrencies and the crypto market has gotten closer and closer to regulatory certainty, the head of a major cryptocurrency financial services company said Thursday.

Speaking at the Qatar Economic Forum in Doha, Peter Smith, co-founder and CEO of blockchain.com, said "2023 has been largely positive for the industry. If you look at year-to-date returns, the digital assets class would be the strongest performing asset class in the financial markets with about 45% on the year so far."

He noted that it could be worrisome if there were fewer developers contributing to open-source crypto projects today compared to three years ago.

"In each cycle, we have observed a slight decline in the number of contributing developers, and it is something we closely monitor. However, in this current cycle, we are actually experiencing growth in the developer community, even in 2022," he added.

He said investors experience an incredibly cyclical market with a roughly four-year cycle in the crypto market.

"One of the reasons for its cyclicality is that it's still a relatively small market," he said, adding the total value of all major cryptocurrencies in existence today amounts to approximately 0.6 times that of Apple.

Touching on the potential impact of the US debt ceiling crisis on the market, he said if the US government defaults, the crypto market will probably see a quick pullback and then a very strong push up.

At the beginning of the year, the US hit its debt ceiling, which led to the debt limit crisis.

On May 1, US Treasury Secretary Janet Yellen warned that temporary measures taken to combat the effects of the crisis could be insufficient.

President Joe Biden's administration and Republican lawmakers are at an impasse over raising the debt ceiling.