Bitcoin’s rise also helped bring attention to other crypto or blockchain-based assets, resulting in an explosive increase in user numbers and liquidity inflows.
Here are six crypto trends to watch out for in 2022, according a report by KuCoin Labs:
The KuCoin Labs report gives us a deeper look at the crypto space trends and what can be expected from 2022.
More tweet wars
Memecoins such as Dogecoin and
More cryptocurrency upgrades
At the same time, the crypto infrastructure space witnessed a considerable amount of upgrades — starting with Ethereum’s London update to Layer-1/2 expansion. Other cryptos like BSC, Avalanche, and Solana are also trying to grab the top spot as the demand for blockchain-based tech stack increases.
The new solutions aim to increase the convenience of network usage and lower gas or processing fees. The report expects the trend to continue as Ethereum and other cryptos scale and launch updates. While Ethereum has dominated a vast chunk of the market, alternatives are expected to pick up soon.
More interoperability
While developers work on scaling, it’s also essential to build cross-chain bridges around Bitcoin and Ethereum. The space is actively evolving as it’s detrimental to weed out inefficiencies. The report says, “it is likely that 2022 will see similar rates of progress on cross-chain development, as well as the commonplace adoption of such solutions on a logical level across major ecosystems.”
NFTs, games and DeFi overlap to get deeper
NFTs topped the charts last year, and with the metaverse concept picking up pace, it’s natural for them to merge with games and DeFi. The combination can create a comprehensive ecosystem that empowers users and gives them the reins of trading and digital asset release. The technology can enable user identification in a decentralized space and play a pivotal role in future integrations.
The DeFi segment is slowly maturing as regulators take notice and start building policies around it. With a boom in tokenization, the report notes that “with the number of new protocols growing, and established ones solidifying their positions, 2022 will likely see the development of Web 3.0 and other innovative solutions that can absorb DeFi space and make it more accessible to a new audience of users.”
Fine tuning DAOs
DAOs also took center stage as various protocols rolled out the governance cum decision-making model. Not all DAOs were victorious, but their underlying operational principles are sound enough to be used as the foundation. 2022 is not likely to see a breakthrough in DAO expansion but rather the refinement of their mechanisms that can pave the way for future adoption on corporate or company-size levels.
Crypto crimes are on the rise as well
On the security side, there were numerous instances of fraud and security breaches, specifically in the DeFi space. The report notes that $610 million were stolen in just one instance of breach, while the total sum lost to vulnerabilities is counted in billions of dollars. While security enhancements and refinements shall help weed out bad players and develop audit models, it is certain that a similar trend will also be observed in 2022.
Many of these topics have gained mainstream media attention throughout 2021. The rising popularity of NFTs, DAO ventures attempting to purchase a copy of the Constitution, and Facebook rebranding to Meta to explore Metaverse opportunities are just some examples.
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KuCoin Labs takes its role in promoting the development of the whole crypto industry. We incubate and invest in innovative projects, guide their development to their maturity where they would bring the best of crypto. As one of the top investment institutions, KuCoin Labs team gathers professional research on a forward-looking journey, unceasingly diving deep into every aspect and detail of a vertical. KuCoin Labs aims to be an integral force in building the future of Web 3.0.” Said
A few forecasts shared by KuCoin Labs are based on the previous trend, current standing, and future potential. Several companies have set up Bitcoin treasuries in 2021, even though it has retraced by almost 50% from the all-time high. KuCoin Labs expects more institutions to be transparent about their Bitcoin purchases, although they may not necessarily acquire BTC directly.
The focus on Layer-1 and decentralized finance is likely to continue throughout 2022. Other trends that could dominate 2022 are NFTs,
Disclaimer: This is a sponsored post in partnership with KuCoin Labs