Share this article
Smokey The Bera to Make Berachain More Resilient to Crypto Volatility
Market reflexivity is a big problem in DeFi.
Updated May 15, 2025, 3:38 p.m. Published May 15, 2025, 3:36 p.m.
What to know:
- Berachain aims to create decorrelated user populations to mitigate market reflexivity, according to its founder Smokey the Bera.
- Reflexivity in crypto can lead to self-reinforcing price movements, potentially causing market volatility.
- Berachain plans to support web2 businesses uncorrelated to DeFi and crypto markets to maintain liquidity and stability.
Berachain is focused on building “decorrelated populations” of users to guard against market reflexivity, said Smokey the Bera, theblockchain’s pseudonymous founder, onstage at CoinDesk’s Consensus 2025 event in Toronto.
Reflexivity is a big concern in decentralised finance and crypto. It refers to the self-reinforcing effect of market sentiment. Rising prices often attract buyers and create a positive feedback loop. However, the same process can operate in reverse leading to a catastrophic collapse in prices.
STORY CONTINUES BELOW
Don't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today. See all newsletters
Berachain’s plan for the second and third quarters is to support profitable businesses that exist in web2 and are uncorrelated to the existing DeFi and crypto markets.
Doing so will help Berachain guard against reflexivity, helping it weather market volatility and retain deep liquidity, Smokey said.
Smokey was joined by Jason Atkins from market making firm Auros, when they discussed all things to do with liquidity — essentially how easily and quickly a crypto asset can be bought or sold without a significant impact on its price.
More For You
More For You
Ethereum Backers Respond to Critics: ‘Markets Will Catch Up’
Ethereum insiders pushed back on criticism of the network’s leadership and roadmap, arguing that the ecosystem is built for long-term value.
Top Stories
