The coronavirus pandemic is affecting more and more aspects of the blockchain and cryptocurrency market. As Cointelegraph previously reported, more than half of the 2020 crypto conferences were canceled or postponed due to the COVID-19 epidemic, while mining manufacturers had to stop producing equipment in China.
At the same time, other companies have been able to seize new opportunities by digitizing business processes and moving employees online. Cointelegraph analyzed the severity of the consequences that seemed to be for projects using blockchain technology and cryptocurrencies, and how the coronavirus pandemic affected their roadmaps and publication schedules.
The latest news related to digital initiatives shows that, in most cases, the extent of changes within the project is directly linked to the degree of spread of the coronavirus in a specific country.
For example, China, which would have stopped the spread of the pandemic on its territory, announced that it would launch its national blockchain network in April 2020, as initially planned. Chinese mining companies have resumed operations after the recent closure of their offices and facilities.
Meanwhile, Russia, which is facing rapid growth in the number of COVID-19 cases, has postponed the adoption of a law on cryptocurrencies indefinitely. Earlier, Cointelegraph also reported that the Russian government had halved the budget for the development of blockchain technologies. New York City, which has an extreme number of confirmed coronavirus cases, has seen almost all local blockchain companies, including Cointelegraph, close their offices.
Other projects have temporarily suspended activities related to doing business in other countries. For example, Prime Trust, a company that provides open banking solutions in the blockchain sector, said that its representatives could not visit their recently opened offices in Cyprus, which resulted in slowdowns and delays with everyone. working remotely.
The situation with the new versions
It seems that the roadmaps of the 20 main cryptography projects in terms of capitalization have not been affected by the coronavirus. This can be explained by the fact that the launch of the main critical updates planned for 2020 is carried out by the blockchain, not by people, and the employees involved are used to working in a decentralized manner.
In addition, process automation has enabled Bitcoin Cash (BCH) and Steemit (STEEM) to successfully fork, while Tether (USDT) launched its stablecoin on the Bitcoin Cash network. The pandemic does not seem to have affected the date of the much-anticipated event of halving Bitcoin, unless miners around the world turn off their equipment at once.
The development of the Cardano blockchain platform (ADA) is also going as planned despite the COVID-19 pandemic, as noted by Cordano founder Charles Hoskinson during a livestream on YouTube on March 13 . Additionally, the developers reassured investors and users that the project had been making substantial progress on the next network update called Shelley – with a number of bugs reported by testnet users having decreased significantly over the years. last weeks.
In an interview with Cointelegraph, Paul DiMarzio, the community director at the Enterprise Ethereum Alliance, explained that the company’s groups are continuing their work, although the alliance has had to adjust its roadmap:
“For Synchronize and Consensus, we have renewed our sponsorship until 2021, Blockchain Revolution Global must now be in the fall. We have suspended all conference ideas for the time being until life begins to stabilize. “
Companies cut budgets and staff
For many blockchain companies, this is an extreme measure taken to minimize the economic consequences caused by the COVID-19 epidemic. Large blockchain analytics companies Elliptic, Chainalysis and CipherTrace have indicated that they have already cut their workforce or their budgets, or plan to do so in the near future. In particular, Elliptic has cut 30% of its workforce in the United States and the United Kingdom; CipherTrace has downsized its sales and marketing departments; and Chainalysis has announced plans to cut employee wages by 10%.
In April, the digital asset conservation agency Trustology laid off seven employees, because the company’s main customers – large banks and institutional players – took longer than expected to enter crypto house.
Marketing is another spending item that companies working with crypto and blockchain technology have cut by canceling offline conferences and other events. In particular, the developers of AlphaWallet symbolized the tickets for the EDCON 2020 Ethereum conference. However, due to the cancellation of the event, the blockchain tickets they worked on are no longer needed. Company CEO Victor Zhang told Cointelegraph that it cost the team about 40 hours of development.
Carlos Domingo, CEO and co-founder of Securitize, a blockchain-based security tokenization company, told Cointelegraph that, although the company has not laid off staff, it has cut its marketing budget.
Another blockchain project – Telos Foundation – has also seen its budgets affected by the recent foreclosure and market volatility. Justin Giudici, the product manager at Telos, told Cointelegraph that to cope with the negative consequences, the project team changed its focus to initiatives with a shorter impact period. Meanwhile, according to Giudici, the company did not fire any employees while seeing an increase in staff working time:
“Some participants unfortunately lost their day jobs, freeing them up to contribute even more to Telos. Many of these contributors have savings and are happily happy to work for TLOS or even for free out of passion and belief in the project. “
Other projects have shifted marketing spending to other areas to better manage their budgets. For example, HedgeTrade, a prediction platform that allows users to make predictions about live sporting events, has postponed its launch due to cancellations of sporting events worldwide. David Waslen, CEO and co-founder of HedgeTrade, commented on the question: “As a result, we will shift some of this focus on marketing and development to other areas of expansion, such as adding forecasting. and the entry into the electronic sports arena. “
The restrictions and economic problems caused by the coronavirus have left many token sales without investment, while forcing others to postpone their launch. The latest ICOBench report shows that the investments raised by the projects during the last week of January to the first week of February are considerably lower than those of the same period last year.
Many projects have postponed their symbolic offer indefinitely. Jesse Uzzell, CEO and founder of Climate Futures, said the project should cancel its token sale and the launch of DApp initially scheduled for March: “We have postponed our launch of 1PLANET and have not decided on the news official launch date due to a coronavirus crisis and how it dominates the news. “
SWAZM, another blockchain company that had planned its initial exchange offer for the first quarter of 2020, has announced its postponement. Vali Malinoiu, CEO and founder of the company, said:
“This forced us to implement homework policies, delayed many partnerships and put us on general alert.”
Investors are now focusing more on keeping their cash flow and are waiting to see what the economic and business landscape will look like after the passage of COVID-19, according to Sukhi Jutla. The symbolic sale of his project, MarketOrders, a blockchain-based market for the gold and diamond jewelry industry, was delayed by three months as technological development slowed.
However, there are those who have announced that their token sales are not affected by the pandemic. For example, on March 5, the BTSE cryptographic exchange reported its IEO as success, with tokens sold in four hours, while the blockchain project Solana raised $ 1.76 million, selling all of its tokens through a Dutch auction.
Major cryptocurrency exchanges such as Kraken, Gemini, OKEx and Bitstamp appear to be unaffected by the coronavirus pandemic, signaling an increase in user registrations and trading volumes. Binance’s monthly futures report revealed an 85% increase in trading volumes on the stock market’s perpetual futures contracts for January 2020. In February, OKEx exchange launched OKChain on a testnet and its first application of decentralized funding, OKEx DEx, followed by the launch of its “Buy the fiat Crypto gateway service for users to convert their fiat to cryptocurrencies in March.
The massive spread of the coronavirus in Asia did not prevent the launch of Huobi Thailand, as reported by Cointelegraph on March 5. Two other major cryptocurrency exchanges – Poloniex and Bitfinex – have not delayed their launches, which are slated for this month – LaunchBase and Wagering Rewards Program, respectively.
Related: Here’s How The Crypto Sector Takes Up To The Challenges Of The Pandemic
With regard to the exchange of cryptocurrencies operating in other regions, the situation seems to be the same. Bithumb Global, for example, shared with Cointelegraph its plans to publish the developments as originally planned.
“The coronavirus doesn’t really affect our growth because most of our business is primarily digital,” said company vice president Vincent Poon. Sunny Ng, marketing director of Bithumb Global, also added that the company has accelerated the development of diversified trading products.
Ali Beikverdi, founder and CEO of bitHolla exchange software provider, told Cointelegraph that existing crypto exchanges using the company’s exchange kit software were reaching record transaction volumes. “This may be due to the fact that more people are online while in quarantine, trying to bring crypto to online trading,” added Beikverdi.
However, according to Beikverdi, the growing reluctance of potential exchange operators who want to start an exchange business has forced the supplier to postpone advertising and marketing content and to postpone the creation of new content.
How do projects deal with the consequences of COVID-19?
Cointelegraph interviewed 18 projects to understand how the coronavirus affected the activities of blockchain and crypto companies in terms of numbers. Ten of them indicated that the pandemic had had no effect on their business processes. They attribute this to their decentralized approach. For example, Changelly CEO Eric Benz told Cointelegraph that the team is still on track to launch its most important product this quarter, and that operations remain strong, with a sharp increase in use.
Careful spending is also what helps blockchain projects not to affect their processes. The Foundation for Interwallet Operability, a developer of smart tokens, shared with Cointelegraph that sound budget management helped the company launch the FIO protocol blockchain in late March with the participation of 23 block producers from around the world. Other projects have adapted to new methods that seem effective in the new reality. Silicon Valley blockchain startup Harmony, for example, is currently experimenting with a “digital whiteboard”:
“Anyone can intervene at any time, comment on our execution asynchronously, while we have windows open continuously if you want to catch up with a colleague. It also led us to improve intra-cooperation between our offices and our colleagues in Europe and China. “
Garlam Won, Harmony CMO, also noted an increasing number of Stake Heist attendees before the public launch of Open Staking due to the increased availability of people staying at home.
In an interview with Cointelegraph, Norbert Goffa, the co-founder and executive director of ILCoin, explained that despite the cancellation of many events and travel restrictions, the project plans to introduce the technology in the fall and adapt to the situation to stick to the road map. Meanwhile, the company is focusing on other aspects that don’t require face-to-face meetings – such as discussion lists and partnerships.
Matic, another blockchain scalability platform, saw many partnerships in March despite the postponement of important events. Chandresh Aharwar, vice president of operations and marketing at Matic, told Cointelegraph:
“Overall, remote working has worked well for us, and I personally see that the team’s overall performance has improved (we are continuously hiring at this time as well, which also plays a role).”
However, the remaining projects have seen their plans significantly affected by the coronavirus epidemic. In a recent blog post, the Filecoin team explained that some members of the project community in China requested a delay before launching the second version of the testnet, thus affecting the final launch of the main network which was then postponed to summer 2020.
Some projects report financial losses and partnership breakdowns caused by the postponement of critical events. Gary Bracey, CEO of Terra Virtua, told Cointelegraph that the project was about six weeks behind schedule:
“We originally planned to run a large beta test in mid-March, with an official launch scheduled for April. Due to current conditions, we had to adapt our strategy accordingly. The key to all of this was our development studio, as each individual had to remove their equipment from the office and settle in at home. “