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Bitcoin gyrates but less euphoria seen at blockchain conference

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A specialist demonstrating how blockchain works at the Consensus 2019 conference in New York on Wednesday. This year's event drew just 4,800 people, unlike 2018's turnout of 8,000.

New York

THE vibe at a gathering last week for blockchain enthusiasts felt decidedly less exuberant than its predecessor a year ago after dizzying swings in bitcoin.

Last year's Consensus blockchain conference took place just four months after the virtual currency hit almost US$20,000, spawning a legion of bitcoin millionaires who rode in swanky luxury cars and partied in over-the-top soirees.

Despite bitcoin's latest bounce, this year's gathering, again held at a hotel in New York, featured less ostentatious displays of wealth and a more sober sensibility.

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The shift is partly a reflection of bitcoin's dramatic price swings, as well as a sign of the evolution of blockchain technology into more real-life, less glamorous applications.

"It's definitely less buzz, less show," said Wes Fuldord, chief executive at Bitfarms Technologies, a cryptomining operation based in Quebec. "But it's reflecting signs of a more mature market."

Blockchain is a digital ledger that is the underlying technology of bitcoin with broad applications in finance and many industries that permit multiple users to share data and information in real time. The technology is considered secure because the data cannot be altered.

"In 2018, we just had a lot of powerpoint presentations," recalled Francois-Xavier Thoorens, founder of blockchain company Ark. "This year, we have real products." Display stands at the event included a Deloitte product of three screens that employs blockchain for cybersecurity, and an application from startup Riddle & Code that authenticates expensive watches.

Speakers included representatives of Pfizer and AstraZeneca, who discussed blockchain applications in pharmaceutical research, and Microsoft, which is marketing a blockchain-based "decentralised identity" to secure personal data.

Attendees also discussed solutions to manage the ownership of digital assets and the various legal and regulatory issues that have surfaced.

This year's conference, sponsored by the digital media company CoinDesk, follows a turbulent year for bitcoin, which bottomed out at US$3,200 in December in a decline that sparked scepticism on the potential of blockchain. The recent rally in bitcoin - doubling to US$8,000 from US$4,000 in late March - failed to push conference attendance to the 2018 count of 8,000. This year's event drew just 4,800 people.

The volatility in bitcoin prices is especially troubling for some observers. Mr Fuldord said some smaller players have exited the market, leaving it to more established companies.

"Some of the hype has slowed down on the back of price weakness in 2018," Mr Fuldord said.

Some blockchain experts have questioned whether the latest rise in bitcoin is a result of financial market uncertainty due in part to protracted US-China trade talks, with investors seeking "refuge" in the crypto market.

But for many, the rally in the digital currency remains a mystery. "We're still at the stage with bitcoin alternating between euphoria and despair," said Mr Thoorens, adding that more attention from regulators should with time lead to a more normalised market.

Mr Thoorens noted that the crypto universe has come a long way from one that only two years ago could lead to banks closing an account linked to a crypto trading platform.

"All technologies go through the same steps, from fringe, to frontier, to mainstream," said Margaret Rosenfelds, an attorney who specialises in blockchain at K&L Gates.

At this point, finance is the most seasoned when it comes to understanding cryptocurrencies and using blockchain, she said.

But many other sectors are looking at applications, and devotees still expect to see growth, even if the technology remains a bit abstract to a non-specialist.

Comparing it to the technology underlying email and many other now-common applications, Ms Rosenfelds said: "The average person doesn't need to understand how it works to adopt and use it." AFP