Lamborghini and Snoop Dog, anyone?

As conferences go, Consensus 2018, which was quite possibly the largest gathering of crypto-enthusiasts and industry personnel in one place, seemed to be a grand success. A record 8500 attendees thronged the halls of New York’s Hilton Midtown hotel over three days last week. (For context, the same conference drew 400 attendees just two years ago). During the day, they attended panel discussions about applications of cryptocurrency technology to industries as diverse as real estate to media. In the evening, they streamed out into New York’s hot and humid weather to attend swanky boat cruises and concerts.

Some complained about the number of suits (aka Wall Street types) at the conference but others cheered the mainstreaming of cryptocurrency technology. There was also a parody of sorts. A group of protestors, who were evidently hired, stood outside the hotel holding up placards claiming to be “Wall Streeters Against Bitcoin”.

But the conference failed to lift the fortunes of cryptocurrency markets. A number of analysts, most notably Tommy Lee of Fundstrat Global Advisors, had predicted a bump in prices post-Consensus. That hasn’t happened. Cryptocurrency markets collectively shed 10% of their value in the last week, dropping to $372 billion this morning. In fact, the markets rallied to $391 billion as Consensus got underway. By the end of next evening, as crypto announcements petered out, crypto market prices had crashed to $361 billion.

“Clearly, we were too optimistic,” Lee told anchors at CNBC. The firm’s prediction was based on the hope that a gathering of large audiences and experts would “reinvigorate confidence” in the markets by removing uncertainty related to regulation and industry adoption. But there was a failure to discern an underlying message from Consensus, Lee told CNBC. “The announcements fell short,” he said and added that there was a “slight negative tilt” due to the continuance of regulatory uncertainty regarding the status of cryptocurrencies and ICO tokens. That said, he is still bullish bitcoin and expects the cryptocurrency to skyrocket to $25,000 by the end of this year.

Still, it is unfair to judge the relative merit or demerits of a conference purely on the basis of its effect on prices. There were a number of notable announcements made during and on the sidelines of the conference. These announcements herald Wall Street’s move towards cryptocurrency ecosystems in the coming months.

The biggest of these related to development of custodial solutions. For example, French custodial solutions firm Ledger announced a partnership with Japanese investment bank Nomura. Komainu is a consortium established to “overcome barriers to institutional investment in digital assets with new services, standards, and best practice.” Apart from Nomura and Ledger, Global Advisors, which is the parent company of CoinShares, is also part of the consortium. North America’s largest cryptocurrency exchange Coinbase announced Coinbase Custody, in partnership with an SEC-regulated broker-dealer. The exchange has partnered with a number of crypto hedge funds to launch its solution. The CEO of BitMex, which mainly targets retail investors, told CNBC that their trading solutions can also be used by Wall Street.

The slew of announcements is not surprising when you consider the interest in trading bitcoin by prop trading firms. According to this Medium post, Jump, a Chicago-based trading firm which is also the largest trader of U.S. Treasuries, has a team of 22 people working on crypto solutions. DRW similarly has 30 people on its crypto team. While these developments are not directly related to Consensus, they might receive a boost from the gathering at Consensus. But the caveats in this equation are regulatory uncertainty and industry adoption. Until there is clarity on those fronts, cryptocurrency prices will continue to move sideways or decline.