• Arthur Hayes criticizes CEX and enterprise capital-backed initiatives and advocates for a return to the ICO mannequin.
• Hayes argues that the crypto trade has strayed from its core mission of empowering retail traders.
• ICOs provide a extra democratic and inclusive approach to fund initiatives with out the bias of conventional VC corporations.

In his essay “The Remedy,” BitMEX founder Arthur Hayes criticizes centralized exchanges (CEXs) and enterprise capital-backed initiatives for hindering innovation within the cryptocurrency trade. He advocates a return to Preliminary Coin Choices (ICOs) as an answer to the issues posed by CEX and conventional enterprise capital.

Hayes argues that the crypto trade has strayed from its core mission of empowering retail traders and as a substitute focuses on enterprise capital-backed tokens that underperform. He additionally notes the evolution of the crypto new issuance market, which is turning into extra much like conventional finance (TradFi), particularly with the introduction of “meme cash.” Hayes views meme cash as tokens with no inherent worth aside from their means to unfold memes and doubtlessly create wealth for early adopters.

Moreover, Hayes criticized the TradFi mannequin, arguing that it prioritizes social connections over expertise and benefit. This bias results in an absence of variety in funding choices, with VCs preferring firms primarily based in acquainted areas.

As a treatment, Hayes advocates a return to an preliminary coin providing (ICO) mannequin, the place initiatives can elevate funds instantly from the neighborhood. ICOs provide a extra democratic and inclusive approach to fund initiatives with out the bias of conventional VC corporations. The ICO mannequin has change into extra affordable as a result of mixture of meme content material's virality and potential know-how.

Additionally learn: Arthur Hayes hyperlinks Bitcoin progress to US financial coverage

Hayes additionally identified that the event of decentralized exchanges (DEXs) will present a fluid and vibrant buying and selling setting. The ICO mannequin is poised to make a comeback with advances in blockchain know-how, improved consumer interfaces, and elevated liquidity on decentralized exchanges (DEXs). Tokens will be traded instantly after issuance, permitting initiatives to boost funds and construct their neighborhood extra effectively.

The authors encourage venture founders to undertake the ICO mannequin and urge retail traders to “say no” and reject the centralized alternate (CEX) mannequin.

Hayes additionally highlighted the speculative nature of ICOs as a power reasonably than a weak spot. Whereas many ICOs inevitably fail, some promise to ship transformative returns to traders. He added that the resurgence of ICOs might in the end disrupt that centralized enterprise capital mannequin.