Observations from ETH Denver 2023

This year's ETH Denver surprised us in a few ways

Last week, we were at ETH Denver meeting with startups, holding office hours, and reconnecting with people we haven’t seen since last summer. ETH Denver was the first big conference post-FTX, so we were eager to see what the mood was. Here are some of our observations from last week:

Big crowds - The crowds were as big as ever - official crowd estimates were at over 13,000 attendees, although we heard some people suggest it was more in the 20,000 to 30,000 range when considering all of the side events. Regardless of how deflated people feel about the industry, there are still an enormous number of young entrepreneurs and developers experimenting with different product/business ideas. We met many college students ditching class to attend the conference.

International presence - The amount of international participation felt very high. At least half of the startups we counseled during our office hours were from outside of the US. Asian countries seemed particularly well represented. 

Building for an enclosed crypto economy - A high percentage of ideas people were developing were based on the idea of a closed crypto ecosystem. There seemed to be very little discussion about how to integrate into existing financial rails or Web2 ecosystems. It felt very much like the 2013-2015 era of crypto conferences where the industry was focused on a fully contained financial ecosystem free from government control or interference. Perhaps it was the nature of a developer conference like ETH Denver but it felt like a reaction to one of these factors:

• People are afraid of regulation and everyone is wary of the regulatory overhang and concerned about it. People want to comply but are confused about how and wonder if it’s even possible. 

• Layer 1’s are still fueling much of the developer ecosystem, which naturally encourages self referential ideas in crypto.

People believe that there is/will be a big consumer backlash against centralized crypto/web3 ecosystems. Many of the startup ideas that we listened to are based on the idea that FTX’s collapse was the pivotal catalyst to push consumers away from centralized crypto platforms. Many of these ideas are predicated on a belief that consumers are now ready to self-custody their assets. 

Special thanks to Jump Crypto and Encode for inviting us to host office hours at The Pit

“Cross-chain” and “zero-knowledge proofs” win the most frequently-heard buzzwords 

So many startups called “ZK___” or people building out solutions that would solve cross chain problems. It seemed like both themes were ever present throughout the conference.

Overall, the mood was optimistic. People were excited about all the “fluff” being washed away, leaving fewer distractions as people grow the ecosystem. There’s a lot of potential, still a lot of work to be done - but lots of excitement. Consensus in April, will be another great check-in point to gauge the mood of the industry.