How SF managed to escape the crypto crash

As cryptocurrency coin prices plummet in frightening, jagged lines on television and computer screens around the world, Adam Jackson remains unfazed, helping hundreds of thousands find work.

Jackson is the co-founder of Braintrust, a nonprofit talent network that uses cryptocurrency to connect freelancers to businesses. Workers using Braintrust are paid in dollars, not cryptocurrency, but it is used to secure gigs and reward users. Last month, investors poured $100 million into the cryptocurrency, which is roughly worth what it was worth a month ago before the latest wave of volatility.

Braintrust is an example of how cryptocurrency price ups and downs are tied to many San Francisco crypto companies, but only loosely. The overall industry here doesn’t go up and down with the price of Bitcoin, which has risen from around $41,000 to $68,000 and back down to the current price of around $38,000 over the past four months.

“Volatility does not affect us. We are not traders,” Jackson told The Examiner. Comparing Bitcoin, the plummeting and most widely used cryptocurrency, with Braintrust is like “comparing a piece of gold with Linux,” the open-source computer operating system, he said.

Cryptocurrency shines with the promise of gold, evaporates bad investments and baffles outsiders. Some say it’s the future of money, others say it’s a complete scam. The falling prices of Bitcoin and other tokens may seem to confirm cynics’ suspicions that this is all a trend not even worth understanding.

It is not true here. In San Francisco, some nonprofits like Jacksons and businesses large and small are working on the challenges of hybrid working, climate change and better ways to send money to refugees. Technicians write code that they believe will change the world. Smart investors demand real business plans. An industry anchored in a laborious reality is taking shape.

Scams certainly abound, but stock market crashes actually help eliminate them. A crypto industry being built here has deep roots and a solid future, experts say.

“There’s a big difference between speculation and utility,” said Cory Johnson, a former business journalist who hosts the “Drill Down” trading podcast and is an expert cryptocurrency commentator. “Silicon Valley is building businesses using cryptocurrency and blockchain that have utility,” Johnson told The Examiner. “They’re not trying to find someone stupid to buy their chips at a higher price.”

Cryptocurrency is a digital currency built on an encrypted computer code called blockchain, which records transactions. The price of Bitcoin and other major cryptocurrencies has fallen recently, in part because the Chinese government banned the use of cryptocurrencies in the world’s largest economy. According to data cited by Bloomberg, this huge setback sent down a crypto investment bull market that dumped $30 billion into cryptocurrency last year.

Think of it this way. The San Francisco cryptocurrency industry is building businesses and nonprofits that look like machines. The sweets inside the vending machines are cryptocurrencies. The cost of candy, or the price of different cryptocurrencies, goes up and down. Some people, cryptocurrency traders, hang around vending machines all day, hoping to buy candies when the price is low and sell them to someone else when the price goes up. Right now, candies aren’t worth as much, and people who bought them when the price was high aren’t happy.

Some vending machine manufacturers are deeply affected by the price of candy. Share prices of San Francisco-listed companies Robinhood and Coinbase recently hit historic lows as the price of Bitcoin and other cryptocurrencies plummeted by half or more. The value of these companies is closely tied to Bitcoin and other cryptocurrencies.

But many other San Francisco cryptocurrency companies don’t make the ATM equivalent. They make chocolate mixers, candy cane harvesters, confectionery conveyor belts and candy coolers. Does the price of candy affect them? Of course, in the long term. But their daily life? Not a lot. And others make entirely different types of machines that have nothing to do with candy.

Braintrust and Ripple, a 500-person private San Francisco company valued by PitchBook at $10 billion, “are businesses with real uses,” Johnson, the host of the “Drill Down” cryptocurrency podcast, told Reuters. The Examiner. “These are not tokens with funny names and promotions where the price goes up and down based on tweets.”

Ripple, supports fast and inexpensive international payments. Despite significant ups, downs and legal challenges, it remains one of the biggest cryptocurrencies in the world. The company did not immediately respond to a request for comment.

Adams developed his nonprofit Braintrust in the trendy coworking space Shack15, which offers stunning views of the San Francisco Bay. Johnson records his podcast and meets with crypto leaders there. At a time when The City’s tech campuses are mostly empty, Shack15 is often filled with talk about the future of money.

Next to Johnson’s space in Shack15 is crypto startup SKALE Labs. Jack O’Holleran, CEO of the 35-person startup, called Shack15 “a nice place for people in the crypto industry.” Cryptocurrency entrepreneurs haven’t gone to the ledge of the Ferry Building as token prices plummet, O’Holleran said.

“There’s definitely a sense of remorse for the people holding the tokens,” O’Holleran told The Examiner. “But it takes five to ten years to build a new Internet. Real builders aren’t looking for the quick buck. The whole scene in the Bay Area is really rooted in those values.

There’s even a silver lining to cryptocurrency price declines, O’Holleran said. “People looking for a quick buck are leaving. It actually helps us. It’s hard to win in the echo chamber of a bull market.

Gene Hoffman, chief operating officer of Redwood City cryptocurrency startup Chia Network, agrees. “This category has a high quack ratio,” Hoffman told The Examiner. “Slowdowns shake off Ponzis.”

The price of the Chia cryptocurrency token settled around $200 last spring after briefly hitting around $1,600 upon release. This week, the Chia coin price was around $80.

“It’s boring,” Hoffman said. “I wish our coin prices were higher. Does that change what we do with the World Bank? Not at all.” In November, Chia launched a program with the World Bank and Costa Rica to build a blockchain network that tracks greenhouse gas emissions to help nations meet the United Nations Environmental Pact’s climate change goals. Paris Agreement.

“These technologies are going to solve real-world problems,” Hoffman said. “It’s independent of the price of the parts.”

Founders of crypto startups can’t get too caught up in the drama of market dips, said Ophelia Snyder, co-founder of 21Shares, a company that facilitates cryptocurrency trading. “The crypto market is moving incredibly fast, both in terms of value and market speculations, and in terms of the underlying technology,” Snyder told The Examiner in an email. Companies in the sector need “the resilience to withstand market fluctuations and not let them distract from progress on important technical and infrastructure issues.”

And despite the ubiquitous charts showing falling cryptocurrency prices, many experts believe that even prices will eventually recover. “Over the long term, we remain optimistic,” Robert Le, senior emerging technology analyst at PitchBook, told The Examiner in an email. “There are huge opportunities to disrupt multiple industries.”

Meanwhile, many companies in San Francisco’s crypto community are working on projects indirectly related to crypto coin prices. “I don’t think anyone understands this emerging industry,” said Jackson, Marin’s co-founder of nonprofit crypto community Braintrust. “It’s like the late 90s, when all the tech stocks were trading together. It took 10-15 years for people to realize that what Microsoft does doesn’t usually affect Google and Apple.

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