The fall from 2022 crypto bear market It still continues throughout the industry, with unsafe credit conditions that have not been fully recovered from the panic crash that has erupted to lenders such as Blockfi, Celsius, Voyager and, ultimately, FTX.
Three years later, privacy-maintaining the clearing of protocol cycles attempted to build a foundation for sustainable credit markets to restore.
In May, the company launched a version of the Pilot of Cycles Prime, which acts like a decentralized home -cleared home, enabling crypto trading companies to net and clear the residual payments without collateral or escrow. The pilot is reserved for institutional crypto trade companies who want to reduce credit use without central counterparts.
In an interview with Cointelegraph, CEO CEO Ethan Buchman said, “unsafe credit conditions have been strictly” since 2022, and “the business previously done in credit requires collateral or pre-funding.”
“The 2022 crisis has confined liquidity from many ecosystems and has led to the ongoing denial of many tokens and defi volumes,” Buchman said. “While some major projects have recovered significantly in 2024/2025, others are not there, and we have seen, for example, the USDC will only recover the 2022 all-time high market cap earlier this year.”
Like traditional finances, the crypto industry has become “more aware of unsafe credit risk,” he said, making it more difficult to restore the credit economy.
https://www.youtube.com/watch?v=-_Q8KQRIDXA
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Crypto cannot rely on tradfi models for all
Although many in the industry draw in parallel between crypto and tradfi, especially as more Traditional financial assets have moved to onchainBuchman emphasized that Crypto cannot take all its hints from the tradition.
“Many in Crypto think that the only way we can restore the credit economy is to recruit large sheets of balance from the tradfi that could be more risk. This is the overall approach of Tradfi, which is anchored to a central bank who prints money to buy security at times of crisis,” he said.
According to Buchman, the better path forward is a “approach to removing the cleaning network.”
“The growth of sustainable credit markets depends on the sound foundations of risk management and clearing in the middle of the system, which activates greater capital-economic and saving of liquidity, especially in times of fatigue.”
In his point of view, “Watering is a starting problem of network topology.”
Others in the industry are also taught Crypto’s liquidity issues. B2 ventures founder Arthur Azizov called it “silent risk structure,” which referred to the 2022 collapse of crypto as an example of “Liquidity Illusion.”
The issue was resurrected in 2025, especially in 90% Mantra’s Om Token In April. Bitget CEO Gracy Chen said the crashing was exposed to “critical” liberation issues in the industry.
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