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As we welcome the dawn of 2024, the crypto landscape unfolds with promise and intrigue. A retrospective glance reveals a year of remarkable strides – a symphony of growth, technological marvels, regulatory clarity, and a burgeoning embrace of digital currencies.
From astounding valuations of digital art, such as Pak’s NFT getting sold at $91 million and Beeples NFT getting auctioned at $69.7 million, to the staggering success of the blockchain-based game NFL Rivals, boasting 1 million downloads in 2023. Brace yourself for the unpredictable surge as the global crypto market cap skyrockets to $1.61 trillion by December 2023, as reported by CoinMarketCap.
In this dynamic arena, where innovation dances hand in hand with acceptance, join us on a journey into the unfolding narrative of crypto’s trajectory in the year ahead. Fasten your seatbelts; the crypto odyssey continues.
Top Cryptocurrency Trends To Watch In 2024
Here are some of the top crypto trends to watch in the year 2024:
Mass Adoption And Mainstream Recognition
In 2023, many people started accepting and using cryptocurrencies daily. Prominent countries like the USA, UK, India, Australia, Switzerland, and Japan have introduced dedicated crypto taxation rules. For example, in Japan, at the forefront of cryptocurrency regulation, crypto falls under miscellaneous income, overseen by the NTA. Crypto taxes in Japan range from 5% to 45%, depending on income brackets. Residents also encounter a 10% inhabitant tax, creating an overall tax range of 15% to 55%. On top of this, big banks and other important financial institutions also began supporting digital money, setting the stage for even more people to use it in 2024.
Rules about how cryptocurrencies can be used are becoming more apparent in different places, making it easier for regular investors to join in. As people become more okay with using cryptocurrencies, you can expect them to be used more widely in regular transactions and eventually become a part of how the world makes money.
Central Bank Digital Currencies
In 2024, central banks globally are actively pursuing the development and integration of Central Bank Digital Currencies (CBDCs). This marks a pivotal moment as nations make substantial advancements in embracing digital currencies, reflecting a notable shift in governmental perspectives. Although CBDCs differ from decentralised cryptocurrencies, their growing acceptance underscores a broader recognition of the significance of digital assets. The adoption of CBDCs holds the potential to streamline financial processes and foster a more efficient digital economy.
DePIN
DePINs, or Decentralized Physical Infrastructure Networks, are blockchain protocols revolutionising physical infrastructure management. In 2024, DePINs are gaining traction, particularly within the AI sector. These protocols operate openly and decentralised, managing hardware like wireless routers, GPUs, and data centres.
As of December 2023, Filecoin is the largest DePIN, incentivising peer-to-peer storage with FIL tokens. Other notable DePINs include Render, Theta Network, Akash, and Helium, each catering to diverse infrastructure needs.
From computing power to wireless connectivity, DePINs offer an open marketplace for various industries like media, gaming, AI, information services, and life sciences. DePINs create a dynamic ecosystem with crypto-incentivised models, fostering innovation and collaboration in decentralised physical infrastructure.
Tokenisation Of Real-World Assets
The tokenisation of real-world assets (RWA) is revolutionising traditional finance, bringing tangible and intangible assets onto the blockchain. This innovative process transforms real estate, fine art, and credit into digital tokens, offering secure, decentralised trading with transparent property rights.
Liquid assets, such as real estate, can be divided into digital tokens. This lowers entry barriers for small investors andenablesg seamless blockchain-based trading. The technology also ensures transparency, letting buyers verify transaction histories for assets like real estate and fine art.
Intangible assets, including copyrights and patents, benefit from tokenisation by storing ownership rights on the blockchain, providing tamper-proof, traceable records in real time. The credit market has also embraced tokenisation, allowing crypto invto access U.S. treasuries, bonds, and cash-equivalent tokens remotely tokens.
Even exotic assets like carbon credits find a place in this transformative landscape. Tokenised carbon credits facilitate a liquid market, simplifying carbon offset purchases for companies and enhancing fundraising for climate action projects.
The increasing adoption of tokenisation underscores its potential to reshape financial landscapes by merging real-world assets with blockchain technology, offering efficiency, accessibility, and transparency.
Data Availability Layers
The future of blockchain is heading towards modularity. A single blockchain system won’t handle specific tasks like settlement, execution, and consensus. Instead, each blockchain will focus on a particular function, allowing scalability and specialisation.
Data availability networks are emerging as off-chain solutions to address the issue of on-chain data congestion and hardware upgrades. These networks enable blockchains to store and verify transaction data externally, preventing blockchain congestion. This not only aids scalability but also ensures that historical transaction data is accessible for verification.
In 2023, the concept of data availability gained prominence, particularly in Ethereum’s scaling roadmap focused on rollups. As more specialised rollups emerge, the demand for data availability solutions will rise. In October 2023, Celestia made history by becoming the first modular data availability blockchain to launch its mainnet. Other notable players in this space include the NEAR data availability layer (NEAR), Avail, and EigenDA, contributing to the evolving landscape of blockchain technology.
Restaking
Another emerging trend in the world of cryptocurrency is re-staking. Crypto investors have increasingly shown a strong affinity for yield, with restaking protocols emerging as a focal point in this market narrative. Restaking involves locking up liquid staking tokens (LST) to generate additional yield.
For instance, when individuals stake Ethereum (ETH) through platforms like Lido or Rocket Pool, they receive corresponding LSTs such as stETH and rETH as proof of their stake. Through restaking protocols, one can augment their yield further by staking these stETH and rETH tokens.
From a financial perspective, restaking mirrors the concept of yield farming. Unlike the more complex process of yield farming, which involves staking, lending, and restocking across various DeFi protocols, restacking simplifies the procedure, making it more accessible to a broader audience. This streamlined approach allows participants to explore additional yield opportunities with ease.
Technically, restaking enhances yield and contributes to the security of roll-up applications, similar to how staking ensures security for Layer One blockchains like Ethereum. This illustrates the EigenLayer protocol, which pioneered restaking on Ethereum.
Developers can utilise EigenLayer to construct roll-up chains for specific decentralised applications (DApps). LST holders, in turn, can earn rewards by becoming validators for the DApps they support, which is achieved by restaking their LST tokens.
Alternatively, those who prefer not to operate a validator node can delegate their LST for restocking to an operator, further expanding the utility of restocking in the crypto-economic landscape.
Artificial Intelligence
AI, the technology that has taken the world by storm, has not left the cryptocurrency untouched. The disruptive nature of AI has positioned it as a formidable force.
Crypto investors are actively seeking opportunities to capitalise on AI by distinguishing between two types of crypto projects:
Projects That Support AI Operations:
These AI-focused decentralised public infrastructure networks (DePINs) provide the essential infrastructure for functioning AI applications.
For instance, crypto projects like Akash and Render operate decentralised marketplaces where users can buy and sell GPU power, a crucial resource for AI applications in processing data.
Projects That Create AI Solutions And Provide AI Services:
This category involves crypto projects that develop and offer autonomous AI software and services.
An example in this category is Fetch.ai, which provides a platform for developers to create and sell autonomous AI software and services. These AI solutions operate independently, allowing buyers to automate various business functions.
Bittensor is a crypto project focused on establishing a decentralised AI industry. Bittensor aims to produce new AI frameworks and create decentralised markets for compute resources, data storage, data processing, and oracles, all within a unified ecosystem.
This dynamic landscape showcases the growing intersection of cryptocurrency and artificial intelligence, with projects spanning from infrastructure support to creating and selling autonomous AI solutions.
Conclusion
In 2024, the world of cryptocurrency is at a crucial point. There are two possible directions it could take. One path leads to more people using it, getting support from prominent institutions, and becoming more connected to the financial system. The other path has risks like crypto taxations and strict government regulations. It’s hard to predict precisely what will happen, but the trends discuss
ed in this blog can help guide us through this critical year.
Author Bio
Snehal Waghmare is a Content Marketing Specialist at Rankfast. With 3 years of expertise in enhancing online visibility through strategic optimization, Snehal not only enhances online visibility but also crafts engaging content that simplifies the complexities of the crypto world. Connect with her on LinkedIn for insightful content.
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*This article was paid for. Cryptonomist did not write the article or test the platform.
