The blockchain bubble claimed another victim at the beginning of March. An institution on the US west coast set up, like many of its peers, to collect deposits to lend on land and property purchases, Silvergate Bank moved into what seemed to be the lucrative world of blockchain almost a decade ago. It found a business in funnelling cash between conventional currencies and a rapidly burgeoning range of cryptocurrencies. But as the FTX empire collapsed and cryptocoin values fell, the bank became another piece of collateral damage.
Since the bubble’s peak, interest in non-fungible tokens (NFTs) issued on various blockchains has fallen sharply as well. The daily value of sales of NFTs on the Ethereum blockchain fell to less than $10m at the end of 2022, from a peak of close to $200m at the beginning of the year. As with the core Bitcoin bubble itself, much of the air in the market came from a rush to own assets, whether cryptocoins or links to ‘collectible...