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Joe Lubin, co-founder of Ethereum: The crypto market is ” the tail being wagged by a very sick dog.”


The long-awaited switch from proof of work to proof of stake in Ethereum finally happened on September 15, and everything went smoothly. Now, 99% less energy is used by the Ethereum network.

Joe Lubin, CEO of crypto software giant ConsenSys and co-founder of Ethereum, told in an exclusive video interview last week that the merge is “what seems to be flawlessly.””I’ve asked around in a bunch of different contexts for any awareness of anything that broke, and I haven’t heard one thing.”

So, why is ETH down 22% since the merge a month ago?

Lubin says that the price action right after the merge was “possibly inevitable “sell the news” activity,” and that some Ethereum miners “dumped their ether inventory as they shut down their rigs.” Since then, ETH, along with Bitcoin and the rest of the cryptocurrency market, has continued to fall.

“The economy is broken, and it’s likely to remain broken for a while,” Lubin said. “So we remain the tail that is being wagged by a very sick dog: the global macro situation. But our ecosystem and our company are doing quite well, even with with reduced volumes, reduced intensity. I think we’re all enjoying just building.”

It’s the preferred explanation from practically every entrepreneur in the cryptocurrency ecosystem at the moment, as crypto markets continue to be hammered by the same economic headwinds in the U.S. and throughout the world that are weighing on equities, bonds, and other more traditional investment vehicles.

Anatoly Yakovenko, who started Solana, points to the same things and thinks the bear market will last at least another year.

“Looking at macro stuff, my guess is there’s probably 12 to 18 months more of this brutal, Fed rates going up,” Yakovenko 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.”

Last month at Anthony Scaramucci’s SALT conference in New York, FTX CEO Sam Bankman-Fried said something similar and maybe the most direct: “Everything is down this year because dollars are up this year.”

The crypto market is likely to stay in the doldrums until money gets cheaper. But Lubin and other developers are still as confident as ever about the most important parts of the crypto industry.

“I think NFTs still have a ton of legs, NFTs are going to undergo so much innovation,” he told . “I imagine we’re post our irrational exuberance moments with respect to DeFi. I think it’ll continue to innovate and mature quite significantly, but I think the real building will be in the development of the Web3 economy.”

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