DeFi Prediction 2023 | What You Gonna See in Cryptocurrency realm

DeFi Prediction 2023: Without a question, 2022 was a fairly down year for the DeFi and crypto industries in general. The trust in the sector has been severely damaged by scams, hacking, rug pulls, and other illegal acts. Compared to the preceding two years, market sentiment for cryptocurrencies has been notably negative.

Additionally, this has slowed down the development of the blockchain and DeFi protocols. In the coming years, some drastic changes might happen. So, in order to comprehend how the market might change or evolve in the coming year, it’s crucial to look at some of the major industry estimates for 2023.

Although users have encountered negative sentiment in the year 2022, still have some positive notes from the 2022. Here you can see what positive you are getting from 2022.

DeFi Prediction: The Positives from 2022

You can’t be obvious that the year 2022 has entirely been depressing and terrible. In year 2022, the use of blockchain has increased across all industries. Talking about the specific field, the banking sector has expanded its blockchain market share from 11% to 29.7% during the past year. It’s a great positive note from the year 2022.

Moreover, the largest company in the banking and financial services sector, JPMorgan, completed its first blockchain transaction on the Polygon network last month. This year, Citigroup also stepped forward and upped its blockchain investment.

Additionally, this year saw an increase in the adjusted TVL (total value locked) for DeFi protocols from $60 billion to $142 billion.

You must have experienced that Ethereum was the primary blockchain network for all active and upcoming DeFi initiatives in 2021. Despite Ethereum’s continued dominance in year 2022, other rival blockchains like Solana and Polygon have seen a surge in market share this year.

What Could Happen in the Year 2023?

The below are the some of the important points that seem obvious that it would happen in the year 2023. Let’s explore the points and learn something fruitful:

Regulation is Inevitable

This year, scams and hacks have rocked the current business, from Celcius to FTX exchange. Users have lost more over $1 billion in money as a result of the most recent FTX crash alone.

More so, major cryptocurrency investment platforms like BlockFi have also declared bankruptcy since there aren’t enough funds to support user withdrawals. The happening of these events in 2023 has unavoidably prompted worries about additional rules for the sector.

Several reputed crypto exchanges have given green flag for increasing regulatory oversight. The CEO of Binance, CZ, has previously released a statement in favor of the requirement for increased regulatory oversight of centralized exchanges.

You might also have come to know that along with other G20 nations, US President Joe Biden is advocating for a strong regulatory framework for digital assets and transactions.

Therefore, these drastic incidents and support of reputed company and people suggest that in 2023, there will be a significant increase in the number of regulations that apply to crypto and DeFi marketing.

Scrutiny for Stablecoins Will Increase

The recent loses of investors due to stablecoins have triggered the authority put more scrutiny. Talking about the same, the stablecoins that don’t have enough audit processes in place to confirm their assets and preserve their dollar peg after the colossal disaster of Terra LUNA and its UST stablecoin has come more under the eye. Obviously, the market has even grown very wary of stablecoins.

In 2022, a number of tier-2 stablecoins failed as a result of a lack of user interaction and adoption. Given the minimal likelihood of additional stablecoins entering the market in 2023, such monitoring may continue. The market may continue to be dominated by Tether and USDC.

Ethereum Might Outperform Bitcoin?

ETH is expected to exceed BTC in terms of growth and scalability in 2023. The long-awaited Ethereum merge finally occurred in September of this year, switching the network’s consensus process from the power-hungry mining-based Proof-of-Work (PoW) architecture to Proof-of-Stake (PoS). This has not only increased the sustainability of the well-known blockchain but also drastically decreased the supply of ETH tokens.

This will benefit ETH in 2023, and the network’s greater adaptability may enable Ethereum to surpass Bitcoin in performance. It is one of the expected DeFi Prediction in 2023.

In general, 2023 is anticipated to be a significant year for blockchain, cryptocurrencies, and DeFi. The community will be hoping for an improvement going into the new year as market mood continues to be weak.

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