The year 2021 was a defining one for the cryptocurrency market. Major announcements such as Tesla’s investment in cryptocurrency and countries adopting cryptocurrency in transactions gave the market significant traction.
Crypto experts predict significant cryptocurrency trends in 2022 and beyond. The cryptocurrencies’ current total market capitalization is over $1 trillion. The number of crypto users is growing daily and evolving at light speed.
There has been a rise in altcoins and technical innovations that will increase crypto adoption. Here are some of the exciting developments to look forward to.
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Metaverse
The Metaverse is a virtual world facilitated by augmented and virtual reality. It combines some elements of the physical and digital world. While you can already enjoy casino games through Slots lv login, the Metaverse will reinforce the experience and make it more immersive.
Unlike with the traditional gaming experiences, the engagement that Metaverse promises should be on a whole another level. Metaverse never sleeps!
It will allow you to do things you cannot do in the conventional gaming environment, and if cryptocurrencies will facilitate the payments there, entertainment will be even easier to get.
The Metaverse presents a huge opportunity for the crypto market. It might just become the mainstream medium of exchange in the Metaverse. Cryptocurrencies will be used to pay for tickets, trade digital assets, socialize and interact with brands.
Each Metaverse platform will have its accepted cryptocurrencies. These will be used to purchase virtual real estate, transfer NFTs ownership, buy avatars, and pay for everything else. For instance, in Decentraland, one of the popular metaverse platforms, the mainstream token is MANA.
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Looming Regulation
One of the negative trends this year has been the looming strict regulation aiming to cut the wings of the crypto industry.
Crypto holders should expect increased attempts at regulation in the crypto market even though the basic principle of blockchain technology is the lack of regulation.
The widespread adoption of cryptocurrency calls for regulation to curb terrorism financing and money laundering. Several US government agencies have already been ordered to assess the opportunities and risks of cryptocurrencies to develop strategies for regulating the industry.
The regulation also comes with several concerns, as it could push away investors that embraced cryptocurrencies due to decentralization and the opportunities that come with the unregulated status. More so, some investors have concerns that the anonymity and transparency of cryptocurrencies could be compromised.
While regulation could impede growth and innovation in the crypto market, it could also attract a new wave of more risk-averse investors who have been on the fence until now. This could pave the way for mainstream acceptance and adoption of cryptocurrencies.
Well implemented regulations could increase stability in the very volatile cryptocurrency market. This will ultimately be a good thing for investors as it will prevent fraudulent activity in the crypto market, and the stability will protect long-term investors. Regulation will give investors more clarity on how they can invest in the crypto market.
At the same time, while governments and relevant agencies look to increase regulation, they should also consider doing it in a way that encourages innovation.
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Continued Growth of NFTs
NFTs give users bragging rights to digital assets representing tangible art items, or the full ownership of purely virtual art.
NFTs are stored on blockchains. The digital assets cannot be destroyed, replicated, or removed. But other than that, they don’t work like cryptocurrencies; NFTs are not divisible.
More people have been adopting NFTs for the status, to support artists or also collect airdrop rights. It’s not difficult to buy credible and authentic digital assets like albums, videos, and images. This allows artists to capitalize on their digital creations.
The NFT market is expected to grow, positively impacting the crypto market, especially if the Metaverse project catches on.
In the optimistic scenarios, people will be going for NFTs to protect their rights to physical and virtual properties, protect documents, facilitate contract negotiations, and verify diverse credentials.
The good thing is that increased adoption of NFTs should increase the audience of all crypto markets and open more possibilities for the use of digital currencies.
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Extreme Amount of New Altcoins Launching
The amount of existing cryptocurrencies has been growing since the launch of the first digital currency.
Currently, there are over 10,000 different cryptocurrencies in circulation, and the number is expected to grow. Investors are faced with the challenge of determining which blockchains to invest in.
Some estimate that by 2030 the crypto market will have tripled. The increase in cryptocurrency users globally will cause an even larger jump in the amount of newly launched cryptocurrencies, most likely with repetitive features.
It is important to remember the impact on the carbon footprint: The sheer amount of useless tokens could push environment-conscious investors away.
Still, as far as the barrier to generating new altcoins remains low, there will most likely be an increase in crypto coins. Even today, people can launch a crypto token with zero technical know-how by outsourcing it - it is not expensive.
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Increased DeFi Adoption
The use of blockchain-powered decentralized financial services is not going anywhere, in fact it is expected to rise.
For instance, more people will choose smart contracts to yield interest payments over intermediaries such as banks.
Increased adoption of decentralized finance will have more investors tie their assets to cryptocurrency, which can be good or bad. Should there be a security breach for instance, a collapse of a DeFi institution could negatively impact the whole industry.
Conclusion
While the crypto market faces challenges, the growth projections are positive. As government agencies regulate the market, more investors will trust blockchain technology. More so, institutions will find the structure appealing and adopt cryptos.
The increased acceptance is also expected to see a rise in crypto coins and innovations, which will further see a boom in the crypto market.