Despite the bearish market, blockchain-based technology — from the internet of things to the metaverse — is poised to generate trillions of dollars in new value by 2030.
The previous year was difficult for people all throughout the world. Financial markets collapsed, affecting millions, if not billions, of people globally. Inflation increased. It has undoubtedly been the worst year for cryptocurrency since Bitcoin’s creation. It’s been more like an ice age than a crypto winter, with bad actors and weak projects dominating headlines, including FTX, Voyager, Celsius, Terra, Hodlnaut, and Nexo this week.
The purge could continue in 2023 with projects that, like Tezos, Lisk, and EOS, do not produce new technologies or innovate. It’s often remarked that 90% of crypto initiatives will fail or fade away because, among other things, they solve nothing.
The suspect actors violated transparency and decentralisation, severely eroding user trust. Big Tech continues to abuse user data and privacy in the Web2 business, forcing the Federal Trade Commission to investigate how Facebook, Google, Amazon, and Apple manage customers’ personal information.
And, as harsh as this silver lining statement may sound, many crypto aficionados have hopefully learnt the lesson that “if you don’t have your keys, you don’t have your crypto.”
It has come down to the failure of huge centralized crypto businesses rather than developers or builders in the blockchain industry.
Proof of reserves (PoR) emerged as a major concern in 2022 to restore trust in the aftermath of frauds and scams. To prove that a centralized platform has enough assets to match user assets, PoR employs cryptographic proofs, public crypto-wallet ownership verification, and third-party audits.
Over $2 trillion in market capitalization was lost as a result of the bitcoin market slump, and many digital assets lost 90% or more of their value.
Guess what, though? Stock market losses have wiped out $9 trillion in wealth from American households alone as of September.
Despite the volatility and demise of multiple crypto enterprises, crypto’s risk-adjusted return performed in par with the US and worldwide stock indices in 2022, and far outperformed US bonds.
Meanwhile, the blockchain market is poised to expand more. According to PwC, the value of metaverse-related projects alone will be $1.5 trillion by 2030.
There are several reasons to remain optimistic about cryptocurrency. On December 7, the number of wallet addresses having a balance of at least 0.1 BTC reached an all-time high of over 4.1 million. On November 28, the number of addresses holding one to ten bitcoins reached an all-time high of 800,000 addresses.
Despite the issues that created a significant slowdown this year, decentralised finance (DeFi) is also on the increase. The number of DeFi users worldwide is growing on a daily basis. At the peak of the crypto market in November 2021, the total value locked in DeFi was over $180 billion. However, we anticipate a return to around $232 billion by 2030.
While GameFi took a knock and sank to $8 billion, credible evidence says it will rebound to $50 billion by 2025 — but others believe it will fail in 2023. The machine economy, or decentralised Internet of Things, is one of the most promising blockchain categories, with a potential value of $5.5 trillion to $12.6 trillion by the start of the next decade.
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