10 Predictions for Cryptocurrency in 2023

This year has been a particularly tumultuous year for the cryptocurrency market, with many decentralized and centralized entities failing or struggling to survive. Malicious individuals and practices are wiped out in a dramatic and necessary process necessary for the maturity of the entire system. Nevertheless, Web3 technology emerging from this crypto winter changes everything.

Web3 represents the next evolution in information exchange, largely analogous to the shift from an agricultural society to a more industrial society. It’s a computing fabric designed to put people at the center and privacy first. Blockchain technology brings new ways to interact with the internet and fundamentally changes the way we interact with each other. As we move forward into the future, there are some predictions about what we can expect to see on the other side in 2023.

1) Crypto venture capital funding will continue to decline through early 2023, but that’s not necessarily a bad thing. Rather, it normalizes to a reasonable point. Investors don’t want to catch falling knives and are waiting for things to bottom out while considering broader macroeconomic concerns and the risk of a global recession. 1/2), interoperability (layer 0/bridge), lending and trading protocols will continue to be funded to fill the void resulting from changes resulting from recent hacks, financial shortfalls and regulatory changes. and exchange collapse.

Related: The Federal Reserve’s Pursuit of “Wealth Countereffects” Is Undermining Crypto

2) In 2023, the original Web3 anarchist ethos of rejecting the need for big brands will be gone. Participants will eventually find that, in the absence of external funding from big brands, there will only be tokens that derive value only from the dollars of users and speculators. Instead, the project embraces the big brands and the advertising, marketing, and sponsorship dollars they bring in, and by distributing meaningful outside capital among real users, he’s building Web3 (a token that stands for micro-equity). Make your dreams come true. Web2 brands such as Nike, Starbucks, and Meta will continue to experiment with Web3, continue to focus on non-fungible tokens (NFTs) as their preferred format, and focus on customer acquisition and engagement over monetization.

3) People will find the way many people have thought of the Web3 community to be bullshit. “Community” is often used primarily to describe “a collection of Discord speculators who share a common dream of rapid wealth, abandoning their projects once their growth carousel is stuck.” We continue to see exceptions to the rule, such as strong and engaged decentralized financial communities, and online-to-offline decentralized autonomous organizations like LinksDAO, but what we see in 2023 is: The whole Web3 ideal of a project/community fit was often just a project/speculator fit. Therefore, we cannot afford to ignore the fundamentals of actual product/market fit.

4) As Web3 app development costs fall and user acquisition costs rise, quality and discovery become more important. Web3 has App Store and AdMob Moments to help developers and users find each other more efficiently. Initially he will have L1 and Wallet vying for this position, but a new player may take over. The breakout Web3 apps of 2023 will be like Angry Birds in 2009, the top downloaded and top grossing apps in the early days of mobile.

5) The current trend towards ‘stability’ and ‘sustainability’ in gaming (due in some ways to the rise of Axie Infinity) creates a wave of products with built-in stability, but dynamic It lacks the nice boom and bust qualities. Most crypto speculation. This creates a flat, muted player experience that feels like a copycat version of his existing Web2 video game. Over time, game developers are recognizing that market speculation is part of the fun and try to embrace it in a healthy and responsible way.

6) Web3 continues to serve a solid niche in apps that are functionally clones of existing businesses but with some basic blockchain components. These apps, like many early Internet companies (such as Amazon as the web bookstore) and mobile companies (such as Robinhood as mobile), hope to offer the same traditional core offerings, but with Web3 to some degree. Cultivate niche markets for users with affinity. stock trader). They are differentiated largely by marketing and experience rather than core product offerings. Some of them, like Amazon, will make moonshot bets on truly paradigm-breaking innovations.

7) To address compliance costs and overheads, blockchain apps will increasingly rely on existing large tokens to power token-related mechanisms. Ethereum continues to push back its roadmap to 2023, but when it finally ships sharding to reduce gas costs, interest in the alternative L1 will drop significantly.

8) Stablecoins will find more use cases outside of virtual capital markets. This will drive more mainstream adoption, primarily among businesses, and innovation within Web3. Government and private blockchain research and development will continue, with some launching centralized public infrastructure such as central bank digital currencies and market infrastructure.

Related: The outcome of SBF’s prosecution could determine how the IRS treats FTX’s losses.

9) Culture wars over cryptocurrencies heat up towards the end of 2023, leading to a U.S. election cycle. (SafeMoon, etc.), booms and busts will continue. More politicians will take a strong stance against cryptocurrencies. However, the US government will continue to be indecisive on regulation, harming domestic industries. The emerging regulations are a patchwork, and risky projects can slip through the cracks.

10) As builders develop through the bear market, the point in 2023 when new growth areas will begin to emerge beyond existing common narratives such as NFT profile picture projects, play-to-earn projects, alternative L1s, etc. there is. The new narrative will drive the next cycle and hopefully these new frameworks will drive real consumer utility and adoption, bringing hundreds of millions of new crypto users/wallets.

Future uncertainty is also an opportunity, and those who can adapt quickly stand to benefit if major changes occur.

This article is for general information purposes and is not intended, and should not be construed as legal or investment advice. The views, thoughts and opinions expressed herein are those of the author and do not necessarily reflect or represent the views or opinions of Cointelegraph.