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Tyler Cowen

How the Crypto Crash Could Be Good for Crypto

A price collapse doesn’t have to herald the end of a technology or its relevance.

What’s next?

What’s next?

Photographer: Mary Turner/Bloomberg

These days, cryptocurrencies are far from the rage. Many have lost 80 percent or more of their market value from their peak in January, and some have fallen off the map altogether. But perhaps that development is precisely what we need for crypto to take the next step forward.

For context, railroad stocks collapsed after a bubble in the 19th century, but still the railroad continued to transform our world. Internet stocks plunged in the dot-com crash of 2000-2002, but that in turn cleaned out the bad companies and paved the way for the subsequent tech revolution, including the rise of Amazon and Google.