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As crypto interest soars: can experts offer us a glimpse into the future?
Cryptocurrency has captured the world's attention, with record highs and significant drops making the crypto landscape increasingly fascinating. This journey has not been without hurdles and regulation is undoubtedly the one factor that could impact the future. That aside, as curiosity about crypto trends for 2023 grows, this news article, guided by expert opinions from CryptoDaily, the world's fastest growing Cryptocurrencty community, will provide a sneak peek into what lies ahead in the cryptocurrency space.
#1. Mainstream Emergence of Web 3.0:
Web 3.0 is showing remarkable signs of dominance in its early days. It is expected to gain prominence in 2023 and beyond. It offers a sustainable solution for individuals who want to fund their websites without relying on large corporations that own servers or charge substantial fees. Web 3.0 allows for a personalized internet experience and prevents single-point failures, such as a specific social media site crashing, which would not impact other activities during the crash period.
As Web 3.0 gains acceptance, cryptocurrencies like Ethereum, Livepeer, and Helium, among others associated with the third version of the internet, will likely benefit.
#2. The Rise of Crypto Warfare:
Recent geopolitical events have significantly impacted the cryptocurrency industry. Although experts predicted a positive trend in crypto after 2021, world conflicts have seen digital currencies facilitate these events.
Per the CSIS, During Russia's invasion of Ukraine, cryptocurrencies played a crucial role for both countries. Russia used crypto to counteract sanctions imposed on them, while Ukraine received aid in the form of crypto donations, totaling nearly $100 million. This situation demonstrates the emergence of a new trend in crypto warfare, which could prompt reconsideration of the decentralized financial system's potentially harmful aspects while highlighting the industry's importance.
#3. Expanding Corporate Crypto Use and Dynamic Applications:
More organizations are embracing cryptocurrencies, as evidenced by major brands like Disney, Microsoft, Google, and Apple entering the metaverse space. The use cases for crypto assets, such as NFTs and metaverse integrations, are also becoming more dynamic.
Microsoft, for example, is developing a SharePoint-based solution called "Virtual Office" to enhance worker interaction regardless of their physical location. As corporate interest grows, more crypto products and services may find novel applications.
#4. Growth of Layer 2 Smart Contracts:
Layer 2 (L2) smart contracts are gaining popularity, and experts believe this trend will continue. Bitcoin and Ethereum are considered "Layer 1" cryptocurrencies, featuring their own settlement layers. However, Layer 1 blockchain networks lack scalability, prompting the development of Layer 2 smart contracts to achieve greater scalability.
These L2 smart contracts are essential for mainstream cryptocurrency adoption, as they enable indefinite scaling.
#5. Cryptocurrencies Driving Green Energy Adoption:
Cryptocurrencies have faced criticism for their environmental impact, with Bitcoin mining in the United States alone producing an estimated 40 billion pounds of carbon emissions.
The Proof of Work (POW) model demands significant energy consumption, often from fossil fuel sources. However, emerging blockchain networks are increasingly adopting more environmentally friendly consensus mechanisms.
These efforts to develop sustainable consensus mechanisms are driving the adoption of green energy in the crypto industry.
#6. Institutional Adoption of the Cryptocurrency Ecosystem
Undoubtedly, one of the most significant cryptocurrency trends is the growing adoption of cryptocurrencies by institutions. Initially, corporations and financial institutions were hesitant about engaging with cryptocurrencies. However, recent times have seen increased collaboration and significant capital allocation towards the crypto market by these entities.
By the end of 2020, institutional assets in the crypto market amounted to around $15 billion, with experts anticipating further growth in the coming years.
PayPal's data reveals that users who purchased cryptocurrency through their app doubled their login frequency after PayPal enabled crypto transactions, underscoring the impact on the money management industry.
#7. Harnessing the Power of DeFi
Decentralized Finance (DeFi) has emerged as a primary catalyst for the cryptocurrency market's growth. DeFi enables traditional financial transactions on the blockchain through the use of smart contracts. Since 2017, search interest in DeFi has skyrocketed by approximately 5,600%. DeFi transactions span various areas, from conventional lending to derivatives generation.
DeFi Plus reports indicate that the Total Value Locked (TVL) in DeFi smart contracts soared from $2 billion in 2020 to $15 billion in 2022, and in 2021, it more than doubled to $100 million.
Yield farming, a popular DeFi application, involves lending crypto assets to other platforms in exchange for interest or new cryptocurrency, thereby maximizing returns through DeFi.
The substantial growth of DeFi highlights its importance as a key cryptocurrency trend to watch.
#8. The Rise of NFTs
Non-fungible tokens (NFTs) have experienced tremendous growth in the crypto market. NFTs are unique tokens on a blockchain that cannot be replicated and may represent real-world items such as artwork or real estate, either physical or digital. NFTs can tokenize domain names, graphics, video games, and various forms of art, enabling more efficient trading, buying, and selling with reduced fraud risk.
Mainstream adoption of NFTs occurred in 2021, solidifying their position within the cryptocurrency market.
NFT sales are expected to skyrocket given that Ethereum NFT sector's market capitalization has surged from $3 million to $33 million.
Conclusion:
The world accepts that the FTX collapse is not unique to cryptocurrency - thanks to the SVB collapse that shows us conventional finance and banking carries a similar risk. As such, we can expect to see cryptocurrency enthusiasts steam ahead, with the only factor on their minds, being that of potential regulation. Remember: keep looking for great crypto tools, keep studying the industry. As governments compete for influence, this might be the one industry where fast moving and innovative countries could shine in order to attract bright minds.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.