Every technological revolution in history tells us that the key to success lies not only in early exposure to technology and practice, but also in a deep understanding of the nature of technology, an accurate grasp of market trends, and a keen insight into future development. This cognitive perspective beyond the conventional is a key factor in enjoying the dividends of Web3.0. In 2024, the change in thinking is particularly important. We conducted in-depth analysis and forecasts of industry trends this year and proposed six key trends. Our purpose is to provide everyone with a new perspective and help those who are concerned about Web3.0 seize the opportunities of the times and achieve sustained growth and development. These trends cover all aspects from technological innovation to regulatory frameworks, from market dynamics to user participation, providing us with anticipatory and response strategies for upcoming industry changes. This article will continue to share the six core trends of the "2024 Web3.0 Digital Asset Trend Report".
Trend 3: The BRC20 inscription is only the starting point of BTC’s new ecosystem. BTC ecological innovation brings new life to digital computing power
The exploration of the Bitcoin ecosystem is like an explorer leaping into the unknown abyss. The birth of the Ordinals protocol, the BRC20 standard and the rise of inscriptions are not only a new starting point for the development of the BTC ecosystem, but also a signal flare for new opportunities for the entire digital mining and trading platform.
In fact, we believe that in the field of digital assets, innovations in underlying technology often herald significant market fluctuations, especially the coming of a bull market. In the recent market development, the innovation of Inscription can be described as a major innovative upgrade in the way of issuing digital assets. Innovation in digital asset issuance methods: From the initial issuance of blockchain-native assets (such as BTC, ETH), to assets relying on smart contract technology (EVM-based assets), to asset issuance methods such as inscriptions, we have witnessed a continuous Evolutionary development trajectory.
Inscription, in its unique way, uses the native assets of the existing chain to issue derivative assets. Compared with traditional asset issuance based on smart contracts, it shows many advantages. Its independence, fairness and security are in the market. It was highly praised. Every inscription of an asset is done on a recognized and secure chain like Bitcoin, so there is no need to worry about backdoor operations or centralization risks. This method ensures the transparency and fairness of issuance. Every transaction and every inscription has its own unique identification. Traceability and non-tamperability are its core features. In addition, compared with smart contracts, inscriptions reduce the risks caused by contract vulnerabilities and provide a more solid security guarantee. In terms of cost, inscription, as a method of issuance that relies on native assets, avoids the high cost of creating and maintaining an independent chain, and also eliminates the complexity and potential expenses that smart contracts may introduce. In terms of consensus, Inscription takes advantage of the strong user base and widely recognized value of the Bitcoin network to ensure a higher degree of market acceptance and community trust.
This innovation is an important milestone for the industry as it not only increases the uniqueness and traceability of assets, but also provides miners with a new revenue stream and helps maintain and enhance the security and stability of the Bitcoin network. . Through Inscription, we are able to issue and trade non-fungible digital assets on Bitcoin, the safest and most decentralized network. This undoubtedly broadens the application scenarios of Bitcoin and also brings unprecedented benefits to market participants. new opportunities. It is this kind of underlying technological innovation that promotes the development of the industry in a more mature and complex direction. We have reason to believe that with the further development and improvement of Inscription and the market’s deeper understanding of this new asset issuance method, more investors will be attracted to enter the market and bring about a new round of bull market.
Ordinals has inspired the emergence of more Tokens and protocol standards, opening up a broader application space and potential possibilities for the Bitcoin network. As a result, the Bitcoin ecosystem has become rich and colorful, and technological progress and value have been further realized.
From the data point of view, the number of daily engravings of Ordinals has repeatedly hit new highs, showing the market's high recognition of this innovation. In 2023, the BRC20 protocol-related transaction volume on the BTC network once exceeded the non-Ordinals protocol transaction volume. On May 7, the BRC20 protocol’s transaction volume accounted for more than 65%, and it also accounted for more than 60% many times in August, September, and November. As of December 8, there were more than 37,643 BRC20 projects with a total market value of more than 3.5 billion US dollars.
On December 21, the total number of cumulative inscriptions on the Bitcoin NFT protocol Ordinals exceeded 46.58 million, and on November 12, it set a new record of more than 500,000 in a single day.
The rise of inscriptions has changed the traditional model of asset issuance, heralding the large-scale rise of the Bitcoin ecosystem. It may also make transaction fees the main source of income for miners, thereby enhancing the stability and security of the Bitcoin network.
We can therefore see that the situation of Bitcoin mining in 2023 indicates a continued growth trend, in which the craze of inscriptions has greatly promoted Bitcoin on-chain transactions and pushed up transaction fees, thus having a fundamental impact on the revenue structure of miners. The change. This new trend has reignited interest in mining. On October 19, according to an investigative report by The Times, Bitcoin mines owned or operated by Chinese companies were discovered in at least 12 states in the United States. The total energy consumption is equivalent to the energy consumption of 1.5 million households. Many mines The farms are equipped with mining machines manufactured by Bitmain. Records show that since May 2021, Bitmain has shipped 15 times more equipment to the United States than the previous five years combined.
Correspondingly, the stock prices of listed mining companies have also rebounded significantly, but the market's evaluation of these companies is obviously divided. For example, the leading mining companies Marathon Digital Holdings (RARA) and Riot Blockchain (RIOT) will be in 2023. The annual increases were 393.53% and 369.73% respectively. The emerging mining company CleanSpark (CLSK) even reached a 141.43% increase. However, there are still some established listed mining companies such as Hive Blockchain (HIVE) and Hut8 Mining Corp (HUT). Follow the rise and fall of Bitcoin. This suggests that the growth potential of the mining industry may be just beginning to be recognized by the market, and investors may not yet be fully aware of this change.
In addition, in the development of the Bitcoin and Ethereum ecology, we should not regard them as opposites, but as complementary existences. The POW and POS they represent respectively jointly meet the diverse needs of the Web3.0 world and promote the construction of a long-term coexistence ecosystem. It is crucial to avoid falling into the bias cycle of technology and market. Only by maintaining an open and exploratory spirit can we truly seize the opportunities of the Web 3.0 era. We should keep an open attitude, Stay hungry, Stay foolish, and meet and embrace new technological trends with an open mind.
On the other hand, due to the rise and craze of inscriptions, digital asset trading platforms are undergoing a profound change. This change lies not only in the diversification of trading methods, but also in the integration of trading platforms and wallet services. Traditionally, trading platforms and wallets are often two separate entities, one focusing on asset trading and the other focusing on asset storage. However, the popularity of inscription technology, especially its application in the Bitcoin network, has forced the trading platform to reconsider its service scope and expand its functions to meet the needs of users who can trade and store assets on the same platform.
This convergence trend is a great boon for users. It lowers the threshold for participating in digital asset transactions and simplifies the operation process. Users no longer need to switch between multiple platforms to complete the entire process from purchase, storage to transaction. For trading platforms, this also means being able to provide more comprehensive services, increase user stickiness, and open up new revenue channels.
We predict that future trading platforms will increasingly adopt this one-stop service model, integrate wallet functions, and provide a more secure and convenient user experience. The integration of trading platforms and wallets will become a major trend in the field of digital asset services, bringing more liquidity and vitality to the entire digital asset ecosystem. Trading platforms are gradually shifting to a one-stop service model, and the market value of each platform's platform currency will also be closely related to their ability to integrate future services. This one-stop service not only includes traditional trading and asset storage functions, but also extends to the integration of emerging digital assets such as inscription technology. As the core component of these platforms, the market value and application scope of platform coins will directly reflect the platform's performance in terms of technological adaptability and market leadership.
In general, the inscription craze is just the beginning of a new ecosystem and the first wave of underlying innovation in the digital asset ecosystem. Every underlying technological innovation in history is often accompanied by three stages of development: technical verification, bubble formation, and finally the return of the market to rationality. Each wave is accompanied by huge opportunities and risks, attracting the eager attention of capital and innovators. In the process, initial bubbles may bring about rapid wealth growth, but this is often short-lived and unstable. These bubbles will eventually recede as markets become saturated and rationality returns.
The key for investors is to recognize this cyclical market fluctuation and stick to the stage that they are most familiar with and good at in their investment decisions. Investors should seek opportunities in areas where they understand and can effectively assess risks, and avoid blindly chasing market hot spots and bubbles. Only in this way can we achieve steady returns and avoid potential huge risks to the greatest extent in this round of technological innovation and market fluctuations.
In the next few days, we will continue to share the six key trends in the "2024 Web3.0 Digital Asset Trend Report".
