As tech leaders are held to account plummeting revenue to investors, a new scapegoat has emerged: crypto.
Philipp Schindler, Chief Commercial Officer of Google, blame slowing company growth in part due to a decline in ad spend by crypto companies in a third-quarter earnings call.
The semiconductor company AMD in the same way ankle its own revenue disappointment, among other things, due to lower demand for graphics processing units (GPUs) that can be used to mine crypto. Revolut, the financial application reached, said crypto revenue has fallen from 30-35% to 5% of the company’s total since 2021.
Crypto has reached a milestone in its institutional adoption journey that most in the space would be happy to detour.
“This is the first real quarter where you’re hearing these companies actively cite crypto as the reason for the revenue shortfall,” said Griffin McShane, chief information and communications officer at MPCH Labs.
But crypto companies had to intertwine with other tech companies to make this shortfall happen in the first place.
In the crypto winter of 2018, Google was exceeding profit expectations whether crypto companies buy ads or not. But while venture capitalists and talented young coders were building excitement around the potential of blockchain, the rest of the tech economy had no choice but to turn to crypto. In 2022, crypto and tech prices tend to move in tandem.
“If you run a profit-driven business [tech] operation, you need to support blockchain and digital assets because that seems to be where we are going,” said David Tawil, CEO of ProChain Capital.
Crypto’s move to the mainstream has been fragmented and beset by unimpressive trading returns in 2022. Bitcoin mining, the original crypto-tech integration, has been Monday 80% less profitable compared to a year ago.
But tech companies seem to be heading into crypto, despite the revenue headaches. Meta and Reddit integrate NFTs on their platforms. Google Cloud is launch of new partnerships with the Ethereum and Solana communities.
Companies further away from Web3 development are likely less affected by the rise and fall of crypto. Caterpillar, for example, hasn’t shown much desire to move its manufacturing to blockchain, and metaverse real estate doesn’t require heavy equipment to build.
But in the tech industry, a world where every company sees itself as part of a crypto company may not be that far off.
“In many ways, I think we’re already there,” McShane said.
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