Starknet Co-Founder Says Crypto Industry Is in Its Worst Slump Ever

Starknet co-founder Eli Ben-Sasson said the cryptocurrency industry is going through the deepest downturn in its history.

Ben-Sasson told crypto outlet U.Today on June 17 that startup shutdowns and budget cuts are repeatedly setting new records, with the industry-wide funding squeeze intensifying.

He said the current crisis could ultimately have a positive long-term effect on the market.

In past bear markets, projects with weak competitiveness could survive for extended periods. Now, many startups are going bankrupt or suspending operations because of funding shortages, he said, adding that the market is due for a reset.

Ben-Sasson also said traditional financial institutions have recently shown less interest in the crypto market, though he does not see that as entirely negative.

Crypto was not created to replace the existing banking system, he said. It was born to expand freedom for financial innovation. The exit of large amounts of capital could also serve as an opportunity for the industry to reconsider its core purpose.

Ben-Sasson has previously said the crypto industry is facing a severe identity crisis.

The market has recently seen weaker investment and project restructurings. Some participants view that as a natural industry shakeout that is clearing away excessive speculation and inefficiency.