‘We’re in a crypto super cycle,’ says CoinFLEX CEO

Welcome to Forkast Forecasts 2022. In this series, leaders, innovators and visionaries in blockchain-related fields tell Forkast.News their predictions for the year ahead.

Mark Lamb

Mark Lamb is a serial entrepreneur of fintech and IT startups. He is co-founder and CEO of CoinFLEX, a physically delivered crypto futures exchange that is a spinout of UK spot exchange Coinfloor, which Lamb also cofounded. CoinFLEX offers futures, spot and repo markets on more than 25 different cryptocurrencies. The company is incorporated in Seychelles, with a global team headquartered in Hong Kong.

Predictions for 2022

We’re in a supercycle

The difference between this cycle and the last cycle … in the last cycle, you largely had Bitcoin and a bunch of different coins, most of which in 2017 were at the end of the day attempts to create ecosystems, but not actually ecosystem coins themselves. So Ethereum, for example, was a dream, and there were lots of ICOs that got funded with Ethereum to go towards that dream, but it wasn’t a materialization or instantiation of that dream. And that’s what we see now where when you have that ecosystem live and billions and tens and hundreds of billions of assets trading and staking and earning yield within that ecosystem, people don’t feel the need to cash out. They feel the need to deploy assets in different ways and not take them out of the crypto economy. So that’s what’s exciting about 2022, it does feel like we’re part of a proverbial super cycle.

Displacement of traditional finance continues

The next period of time is going to be all around — there will be some very big outperforming projects and the whole space is going to keep growing at an incredibly astonishing clip. It’s really just the displacement of traditional finance, fiat currencies and the traditional way of doing things — Web 2.0 versus Web 3.0.… There’s a lot of people who overpriced that disruption in the short term and then really underpriced it in the long term. In the long term, people think, Oh, wow, this is going to happen in the next two years, then it’s going to be done. … Look, I’ve been in crypto nine years. It hasn’t slowed down at all. It hasn’t stopped. It’s unabated. And so that disruption is going to take place over a 20-year cycle and it’s going to be infinitely bigger than everyone’s thinking it’s going to be.

Crypto’s secret weapon is stablecoins

We’re going to see this transformation where people start realizing the value of the dollar being locked up and being delayed and being in a system that’s less efficient. And that realization will make its way to stablecoins, which inadvertently will end up funding the growth of crypto.

There’s not very much leverage in crypto as a percentage of the market cap. The leveraged positions in crypto are maybe $20 – $30 billion. The crypto market is around $3 trillion. So 1%.  And you compare that to equities in any sort of traditional industries and it’s much higher: 25%, 50%, et cetera. So the interesting thing you see here is: The opportunity to be a provider of leverage and earn yield from your dollars while you’re using your dollars is something that banks have, and the consumers, the people, the retail users don’t have. 

The benefits of stablecoins are actually very underestimated, especially in the short term. It’s grown to be huge, but it’s kind of something the market is actually sleeping on. And we’ve seen that with flexibility, it’s just been completely transformative for us this year.