It’s been a pretty bad year for the cryptocurrency markets. So what awaits cryptocurrency enthusiasts in 2023? Here are 10 crypto predictions for 2023…
A possible Binance investigation could complicate the crypto market recovery
A major market crash could send BTC price below $13,000 and ETH below $800 in the first half of 2023. Also, the continued effects of the FTX collapse could lead to some potential bankruptcies. Also, the recent FUD on Binance is worrying, though it hasn’t done any harm yet. It could be a disaster for the industry if the investigation into global regulatory collaborations with Binance or companies of similar size comes to fruition.
An investigation by the US for Binance could prolong the recovery time for the markets. However, Binance, which owns more than 10% of the entire industry value, seems hard to fail.
The real cryptocurrency bull will be in 2024
If we follow the historical trends of Bitcoin’s 4-year halving cycle regarding the crypto bull runs of the past, the next Bitcoin halving is around May 2024, coinciding with the macroeconomic cycle. In addition, the regulatory environment may change. Institutional infrastructure for cryptocurrency investment, which may be ready with regulations, is also developing. All put together, the true bull is more likely to happen in 2024. More stable economic conditions in 2023 than in the past few years and regulatory clarity for the crypto industry could lay a good foundation for future bull runs.
Bitcoin adoption will increase
After El Salvador, Central African Republic and Brazil; other countries may also accept Bitcoin as a means of payment. It’s been more than a year since El Salvador made Bitcoin a legal national currency. Also, the Central African Republic (CAR) approved Bitcoin as a legal tender in April 2022. El Salvador continues to buy Bitcoin for its national reserves. Also, many Brazilian companies have started to buy Bitcoin. This trend will continue whether in a bear market or a bull market. Countries whose currencies are more volatile than Bitcoin, and especially those with a concentration of younger generations adopting innovation, would consider a try.
Institutional interest in crypto markets is growing
Some trillion-dollar AUM traditional funds will begin to allocate large amounts of capital to crypto assets. While some financial institutions insist on their bearish views on cryptocurrencies, there will be some forward-thinking institutions that are bullish and see this bear market as an opportunity to prepare. Banking Giants USA Bank, Morgan Stanley, BNY Mellon, Goldman Sachs, Citi, Wells Fargo and others are investing in crypto assets or infrastructure at various stages and scopes. There are also recent efforts by BlackRock, Fidelity, Citadel, and Virtu to convert to cryptoassets.
These are all trillion-dollar financial firms with vast potential to take crypto assets to new heights. Currently, there are only $9 billion in direct crypto assets from these firms. But that number could change dramatically if these “pilot” routes go at full throttle. While we don’t know what the underlying trigger will be, this change will most likely happen in the next few years.
Major economies may approve Bitcoin ETF
Major economies will approve cryptocurrency-related ETF. vThis will lead to some institutional money entering the cryptocurrency market. Although China has banned crypto, Hong Kong is now keen to open up to crypto and compete with Singapore. Recently, the Hong Kong Securities and Futures Commission (SFC) approved CSOP’s application to list its Bitcoin and Ethereum Futures ETF on the HSE. It gives more hope to other Asian countries to follow the trend, as well as for the Middle East and South American countries that are already quite heavily adopting crypto.
Plus, ETFs that are already traded in Canada, the US, Brazil and Europe, we will see it added to the list. A Bitcoin spot ETF may not have been approved that early in the US yet, but that day will come and the impact will be significant.
These companies can receive payments with cryptocurrencies
Apple could add crypto as mobile payments, including Google, Meta or Twitter, possibly USDC, Bitcoin and even Doge Coin. As we reported on cryptocoin.com, the USDC stablecoin has been added to Apple Pay to help increase the use of cryptocurrencies by allowing Crypto businesses to accept payment method. Also, Apple plans to allow external iOS Apps as a potential boon for Crypto and NFTs. Twitter has reportedly submitted paperwork to the Financial Crimes Enforcement Network (FinCEN) to initiate the registration process to process payments. There is a growing rumor that Tesla CEO Elon Musk plans to reschedule payments and consolidate them on Twitter.
It’s no secret that Elon loves DogeCoin, and if it could work legally, it’s theoretically possible to add DogeCoin as a payment method on Twitter. While Meta’s global stablecoin project (Libra or Diem) scares many central bankers, its efforts in Metaverse, crypto and Web3 are huge. Whether it’s payment or tech infrastructure, it’s no surprise that Meta is taking action to embrace crypto more.
2023 will be an important year for these cryptocurrencies
Metaverse and Web3 Gaming will grow exponentially, especially integrating with AIGC (AI-generated content) and NFTs. Citi says the metaverse could be worth $13 trillion by 2030. JPMorgan has announced that Metaverse will become a $1 trillion economy by 2023. Deloitte says Metaverse could add $1.4 Trillion a year to Asia’s GDP by 2030. The latest AI-powered ChatGPT provides an example of how gamified technology can quickly go viral, and that’s where Web3 is good.
There are also developers trying to create an AI picture on the blockchain using the power of NFT and Metaverse. I predict that this combination of different elements will eventually reach a full ecosystem and 2023-24 is the key period to build this foundation. APE, FLOW, and THETA are currently some of the leading NFT and metaverse altcoins by market cap.
SocialFi will continue to evolve
SocialFi will continue to build and evolve. SocialFi (the social media related crypto ecosystem) that can increase social network monetization and gamification to emphasize community ownership. In addition, there are emerging decentralized video and music platforms that allow the creator property economy to flourish. It is essentially building web3 apps on the success story of YouTube, TikTok, OnlyFans, Netflix, Spotify etc.
Next on Web3…
Exponentially more Web2 engineers, lawyers, finance and other young talents will join web3. Because they believe Web3 is the future and it’s more fun. Also, technical layoffs may hurt some, but if they can’t find a sufficiently lucrative web2 job, it can reinforce their commitment to building Web3 startups. While venture capital willing to invest in web3 has been lower due to the drop in the market, these web2 talents have amassed wealth from high paying web2 businesses that can drive development with their own money out of pocket.
These groups have the best engineering and product skills to help them succeed in the next Web3 bull run. More and more young talents will join to create Web3 and it is likely that Web3 will become better and more legitimate.
CBDC studies of countries are accelerating
Digital currency adoption is accelerating. Also, more countries are launching their central bank digital currency (CBDC). CBDC developments will increase awareness of the digitalization of currencies and add some legitimacy to people’s thinking about digital currency. Here are the latest and upcoming CBDC progress/plans globally:
1) The Central Bank of the Republic of Turkey Plans to Launch CBDC in 2023.
2) Pakistan Initiates New Laws To Accelerate CBDC Launch By 2025.
3) Bank Of England Opens Applications For ‘Proof of Concept’ CBDC Wallet.
4) The Reserve Bank of Australia (RBA) expects to complete its central bank digital currency (CBDC) pilot by mid-2023.
5) Testing the wholesale use of the central bank digital currency (CBDC), the Reserve Bank of India (RBI) is preparing to run the retail pilot of the “digital rupee”. The pilot should begin in December 2022.
6) The Central Bank of Korea is advancing to the next phase of central bank digital currency (CBDC) development, a real-world test in late 2022 and beyond.
7) The Swedish central bank has partnered with Norway, Israel and the BIS to test international retail payments via central bank digital currencies (CBDCs).
8) The central banks of France, Singapore and Switzerland want to explore cross-border CBDC trading and settlement using DeFi protocols.
9) Iran has started experimenting with a central bank digital currency (CBDC) by launching a pilot program in partnership with two local banks.