Ten Predictions For Web3 & The Crypto Economy For 2022- Best Guide

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Ten Predictions For Web3 & The Crypto Economy, 2021 proved to be a breakout year for crypto with BTC price gaining almost 70% YoY, Defi hitting $150B in value locked, and NFTs emerging as a new category. 

Here are my ten predictions through the crystal ball into 2022 and what it holds for our industry:

Ten Predictions For Web3 & The Crypto Economy

1. Eth scalability will improve, but newer L1 chains will see substantial growth — 

As we welcome the next hundred million users to crypto and Web3, scalability challenges for Eth are likely to grow. 

Ten Predictions For Web3 & The Crypto Economy

I am optimistic about improvements in Eth scalability with the emergence of Eth2 and many L2 rollups. The traction of Solana, Avalanche, and other L1 chains shows that we’ll live in a multi-chain world in the future. 

We’re also going to see newer L1 chains emerge that focus on specific use cases such as gaming or social media.

2. There will be significant usability improvements in L1-L2 bridges — 

As more L1 networks gain traction and L2s become bigger, our industry will desperately seek improvements in the speed and usability of cross-L1 and L1-L2 bridges. We’re likely to see interesting developments in the usability of bridges in the coming year.

3. Zero-knowledge proof technology will get increased traction — 

2021 saw protocols like ZkSync and Starknet beginning to get traction. 

As L1 chains get clogged with increased usage, ZK-rollup technology will attract both investor and user attention. We’ll see new privacy-centric use cases emerge, including privacy-safe applications, and gaming models that have privacy built into the core. 

This may also bring more regulatory attention to crypto as KYC/AML could be a real challenge in privacy-centric networks.

4. Regulated Defi and emergence of on-chain KYC attestation — 

Many Defi protocols will embrace regulation and will create separate KYC user pools. 

Decentralized identity and on-chain KYC attestation services will play key roles in connecting users’ real identities with Defi wallet endpoints. We’ll see more acceptance of ENS type addresses, and new systems from cross-chain name resolution will emerge.

5. Institutions will play a much bigger role in Defi participation — 

Institutions are increasingly interested in participating in Defi. For starters, institutions are attracted to higher than average interest-based returns compared to traditional financial products. 

Also, cost reduction in providing financial services using Defi opens up interesting opportunities for institutions. However, they are still hesitant to participate in Defi. 

Institutions want to confirm that they are only transacting with known counterparties that have completed a KYC process. The growth of regulated Defi and on-chain KYC attestation will help institutions gain confidence in Defi.

6. Defi insurance will emerge — 

As Defi proliferates, it also becomes the target of security hacks. According to London-based firm Elliptic, the total value lost by Defi exploits in 2021 totaled over $10B. To protect users from hacks, viable insurance protocols guaranteeing users’ funds against security breaches will emerge in 2022.

7. NFT Based Communities will give material competition to Web 2.0 social networks — 

NFTs will continue to expand in how they are perceived. We’ll see creator tokens or fan tokens take more of a first-class seat. 

NFTs will become the next evolution of users’ digital identity and passport to the metaverse. Users will come together in small and diverse communities based on the types of NFTs they own. 

User-created metaverses will be the future of social networks and will start threatening the advertising-driven centralized versions of social networks of today.

8. Brands will start actively participating in the metaverse and NFTs — 

Many brands are realizing that NFTs are great vehicles for brand marketing and establishing brand loyalty. 

Coca-Cola, Campbell’s, Dolce & Gabbana, and Charmin released NFT collectibles in 2021. Adidas recently launched a new metaverse project with Bored Ape Yacht Club. We’re likely to see more interesting brand marketing initiatives using NFTs. 

NFTs and the metaverse will become the new Instagram for brands. And just like on Instagram, many brands may start as NFT natives. We’ll also see many more celebrities jumping on the bandwagon and using NFTs to enhance their personal brand.

9. Web2 companies will wake up and will try to get into Web3 — 

We’re already seeing this with Facebook trying to recast itself as a Web3 company. 

We’re likely to see other big Web2 companies dipping their toes into Web3 and metaverse in 2022. However, many of them are likely to create centralized and closed network versions of the metaverse.

10. Time for DAO 2.0 — 
Time for DAO 2.0

We’ll see DAOs become more mature and mainstream. More people will join DAOs, prompting a change in the definition of employment — never receiving a formal offer letter, accepting tokens instead of or along with fixed salaries, and working in multiple DAO projects at the same time. 

DAOs will also confront new challenges in terms of figuring out how to do M&A, run payroll and benefits, and coordinate activities in larger and larger organizations

We’ll see a plethora of tools emerge to help DAOs execute with efficiency. Many DAOs will also figure out how to interact with traditional Web2 companies. We’re likely to see regulators taking more interest in DAOs and making an attempt to educate themselves on how DAOs work.

Thanks to our customers and the ecosystem for an incredible 2021. Looking forward to another year of building the foundations for Web3. visit our website


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