Web3 investments have been gaining attention as a potential hedge against disruption in the technology industry, and senior director at venture capital firm Bertelsmann Investments, Martin El-Khouri, agrees. Despite regulatory challenges and market downturns, investors continue to back new ventures in the Web3 space. Decentralized finance (DeFi) startups have experienced a remarkable surge in venture capital funding, nearly 120% in 2022 alone.
El-Khouri, who recently spoke at the Proof of Talk conference in Paris, emphasized the importance of distinguishing between genuine value and artificial inflation in the market for Web3 investing. With the hype in the space subsiding, investors can now identify projects built on solid foundations.
Many investors now view Web3 investments as a strategic move to hedge against disruption. However, El-Khouri acknowledges the difficulty of convincing corporate leaders in large global entities to pay attention to Web3. He suggests that the industry has a certain reputational problem that needs to be addressed for traditional corporate leaders to take it more seriously.
Regulatory risks are always a concern for investors, but El-Khouri emphasizes that regulatory clarity can actually benefit investments in the Web3 and crypto sector. For example, the upcoming EU‘s new Markets in Crypto-Assets (MiCA) regulation can potentially ease the process of evaluating different types of businesses.
Aside from Web3, El-Khouri also noted the growing interest in generative Artificial Intelligence (AI) and AI startups. The AI market is projected to reach $407 billion by 2027. Despite the rapid growth of the AI market, El-Khouri believes that blockchain and crypto will play an even more crucial role, particularly when combined with generative AI.
Blockchain can address issues such as the double-spending problem and provide provenance to digital assets, which is particularly relevant in AI content creation. El-Khouri concluded his interview by asserting that blockchain can solve the double-spending problem without the need for an intermediary, and it gives provenance to digital assets.
In conclusion, while Web3 investments are being seen as a hedge against disruption in the tech industry, there are still challenges to overcome, such as reputation and regulatory clarity. However, with growing interest in blockchain, AI, and crypto, the future of these industries looks promising. Investors need to carefully consider the genuine value and long-term potential of new ventures in order for the Web3 space to fully realize its potential.
Source: Cryptonews
