Four Crypto Predictions for 2024

Bitcoin Spot ETF Approval

The anticipation surrounding the approval of a Bitcoin spot ETF has persisted over the last five years, often feeling like an elusive goal. However, signs in 2024 suggest a breakthrough. Regulators are dedicating time to BTC-related meetings, signaling a potential landmark moment. Drawing a parallel to 1993 when State Street introduced the SPY 500, which has become the most liquid and heavily traded equity globally with an average daily trading volume exceeding 30 billion.

Allowing Main Street retail as well as FDI (Foreign Direct Investment) funds access to incorruptible digital monetary system characterized by absolute scarcity.

New All-Time Highs for BTC and ETH

As I write this Bitcoin is the 10th Most valuable global asset valued at $855.5 Billion. Worth more than Visa, Tesla, Berkshire Hathaway and other giants. The upcoming BTC halving in spring, reducing block rewards, is poised to create a supply shock. Paired with a surge of capital that has remained on the sidelines for over a year, this sets the stage for new all-time highs. Economically The 2023 post-downturn period has seen significant tech innovation in the web3 sector, reminiscent of the post-2001 downturn in the S&P which was the catalyst for a new bull run.

Bitcoin has added programmability features, including base protocol improvements and increased activity in Layer 2 (L2) offerings, Bitcoin is expected to experience a substantial uptick in activity.

Ethereum appears poised to become the preferred blockchain for various real-world assets, including tokenized real estate. Additionally, several filings for Ethereum-based ETFs have been submitted, with the potential for a smoother approval process following the approval of a Bitcoin Spot ETF.

Web 3 VCs deploying again with tightened DD

Web 3 funding experienced a substantial 68% decline in 2023 compared to 2022, plummeting from 33.2 billion to 10.6 billion. Web 3 venture capitalists are now demonstrating a heightened sense of risk aversion, shifting their focus towards established legacy projects and blockchains that demonstrate adaptability and the potential for expanding use cases. This shift signifies a departure from the spray-and-play strategy observed in 2022, especially among venture capitalists who faced challenges in securing new funding rounds.

DEFI Summer 2.0

2020 brought us DeFi summer, while most of us dealt with global shutdowns DeFi surged 2024 holds promising signs for the decentralized finance (DeFi) space, giving rise to what enthusiasts are calling "DeFi Summer 2.0." Several factors contribute to this optimistic outlook.

• Maturation of DeFi Protocols: The DeFi landscape has matured since the initial DeFi Summer of 2020. Protocols have evolved, learning from past challenges, and are now more robust, secure, and user-friendly. Think LSD (not the drug of the 70’s but Liquid Staking Depravities).
• Widespread Adoption: Increasing global awareness and understanding of DeFi concepts are fostering greater adoption. As traditional financial institutions explore blockchain technology, decentralized alternatives gain legitimacy especially with RWA (Real world assets).
• Interoperability and Cross-Chain Solutions: Improved interoperability between various blockchain networks and the development of efficient cross-chain solutions are overcoming scalability issues, making DeFi more accessible and efficient.
• Innovations in Governance and Tokenomics: Governance models and tokenomics are evolving, enhancing community participation and incentivizing sustainable growth. This evolution creates a more dynamic and resilient DeFi ecosystem.
• Advancements in Security Measures: Learning from past exploits, DeFi projects are implementing advanced security measures, reducing vulnerabilities and increasing user confidence.