January 5, 2023: Aggregated New Year Predictions 🥳🍾🔮

The Most Commonplace 2023 Crypto Prophecies

crv.mktcap.eth

Jan 05, 2023

“It is difficult to predict, especially the future.” —Niels Bohr

We’ll go out on a limb and drop the following predictions for 2023:

Predictions about the remaining 99% of 2023 may be a bit tougher. Conventional wisdom about 2022 was especially wrong.

King G @MrCustomSuit

Reading 2023 theses/predictions is a waste of time. Especially if it's from funds/VCs/instis. Basically just shilling their bags and giving the public optimism for the future of the space (for their own benefit; most are crypto native). They were wrong about everything in 2022

Jack Niewold 🫡 @JackNiewold

For today's newsletter, we're evaluating the 2022 predictions of the biggest names in crypto: did [REDACTED] hit any of these? Sending this out tonight, find out which crypto founder made the below predictions: CryptoPragmatist.com/sign-up/

We saw several dozen predictions about crypto in 2023, so rather than bore you with another lame-brained prediction thread, we thought it easier to simply aggregate all the other predictions and build the ultimate meta-predictions list. We’ve categorized every prediction, and sorted predictions from rarest to most common.

I this exercise useful? The bear case is that it’s just a reflection of groupthink. A lot of the predict0000rs were VCs, who disproportionately lack independent thought and sit far left on the IQ curve.

On the other hand, the wisdom of the crowds is the best engine we have for untangling the future. Besides, some VCs still have a lot of money, so they may well have the dry powder to bring their vision to reality.

Here’s what everybody expects will happen.

Nation-State Adoption

More nations are going to buy crypto in 2023, according to at least 5 predictions.

Tom Dunleavy @dunleavy89

6. BTC nation-state CB buy by one G20 country (Argentina?) This recent study can be taken with a grain of salt bc it comes from noted crypto firm HarvardU but the crux is BTC+gold will become a larger share of cb reserves bc the risk of holding treasuries post Russia sanctions

Seq @CryptoSeq

12/ Russia will either use Bitcoin or Ethereum for cross-border settlement. They will issue assets consisting of local currency as well as commodities likely on a private instance of Ethereum and interoperate and use public Ethereum for settlement.

Inverted:

Real World Assets

In 2023, real world assets are so big you can just use the acronym RWA to get your prediction across.

Tom Dunleavy @dunleavy89

3. Defi stops being just ponzi games More and more real-world assets (RWA) will be secured on-chain Today $635M/~12% of DAI supply is collateralized by RWA. RWA asset loans will grow to 1/3rd of DAI/over $2b @goldfinch_fi @maplefinance + others see RWA loans grow to $2b+ too

Options

What’s the over/under on options? It’s the next big thing according to six predictions.

Tom Dunleavy @dunleavy89

9. Options notional$ exceeds $100b a mth Options volume > spot in equities Crypto spot > options volume by ~20x Derbit has 92% of volume. Too high The traditional options market has 4 major players vs 1 here. Watch for: @lyrafinance @dopex_io @Buffer_Finance @PremiaFinance

Peter Johnson @TheChicagoVC

4) Crypto options volumes break ATH (coin-denominated), and @DeribitExchange falls below 75% market share. @alexmatthews95 knows this market extremely well (follow him). His thread dives deep on this one. cc @tradeparadigm @Injective_ @OrBit_Markets

Alex Matthews @alexmatthews95

1) Part 3 of our 2023 predictions is out now! Check below for my thoughts on the crypto outlook for options trading in 2023. https://t.co/86H8YLYYoq

Alex Matthews @alexmatthews95

1) Part 3 of our 2023 predictions is out now! Check below for my thoughts on the crypto outlook for options trading in 2023.

blockworks.coWhat to Expect for Ethereum and Blockchain Infrastructure in 2023 - BlockworksWhere now for Ethereum? What’s in store for stablecoins? A final series of predictions for 2023 from Brevan Howard Digital’s venture team.

knower @knowerofmarkets

17) Options volumes will go 5x from 2022 / current daily average by EoY and will be led by platforms like Aevo and Strike w/ increase in popularity of options involving Uni v3 LP positions

Stablecoins

The third largest cryptocurrency may have seen its market cap drop in 2022, but it’s up only for 2023. Lots of stablecoin predictions, with Visa in particular is in the crosshairs.

Peter Johnson @TheChicagoVC

ICYMI - 2023 Web3/Crypto Predictions - Thread Form: 1) Stablecoin volumes (on-chain only) surpass the largest card network, @Visa, which processes around ~$12tn / year.

Zero Knowledge

ZK applications are seemingly too technical for the average person to have a strong opinion, but at least seven predictors though to weigh in.

Miles Deutscher @milesdeutscher

6. ZK-rollups (and zkEVM) are the top performers. ZK is one of the most exciting crypto innovations, and there are many upcoming products on the horizon (zkSync, Hermes, Aztec etc). Out of the top performers list, I expect ZK to feature heavily in the top 20 by the end of 2023.

knower @knowerofmarkets

5) Development of ZKRs and zkEVMs will continue and get even faster than 2022, with VCs touting this as a new narrative

Inverted:

proto.eth @protolambda

4) ZK-rollups will not be post-EOF EVM-equivalent at EthCC, a year after their initial announcements. Due to upstream EVM changes like EOF, and incomplete rewrites/upgrades with new ZK tech.

DeFi

Not a big surprise that people have opinions on DeFi in 2023. They generally took the form of predicting DeFi would outpace CeFi, or prognosticating the rise of permissioned DeFi.

DeFi vs CeFi

knower @knowerofmarkets

2) DeFi TVL will reach $75 billion by EoY, but the top 50 protocols by TVL will look vastly different to today’s list

Permissioned DeFi

Seq @CryptoSeq

8/ This will also have consequences for DeFi and think we will see some permissioned DeFi next year as well as more controls being enforced - IP blacklists and potentially also KYC. DeFi will continue to struggle with high interest rates being offered elsewhere with lower risk.

_gabrielShapir0 @lex_node

(6) at least one major DeFi project will add CEX-style KYC/AML to its web apps

Institutional Adoption

Here come the institutions! Certainly to several businesses who sell to such institutions.

Tom Dunleavy @dunleavy89

18. Inst. use the bear market + clearing regulatory environ. as an entry point. At least one big bank gets involved in a big way. $5.5T take rate across transaction intermediaries. Tradfi needs to get in on disintermediating that bf defi eats their lunch. These guys arent dumb

Seq @CryptoSeq

10/ Whilst at the same time regulatory clarity and familiarity with compliance opens the door for traditional finance players to become more prominent in this space which ultimately enables more integration with the traditional markets and sets foundation for wider adoption.

Self-Custody

Self-custodial wallets have been around since the beginning of cryptocurrency, but they’re getting a lot of attention in 2023 — at least 9 predictions.

Tom Dunleavy @dunleavy89

21. Self-custody has a new bull mkt w/ innovations like account abstraction/MPC @Ledger + @Trezor sales 2x. But this is a long term trend. We see CEX volumes v DEX move back to ATHs as we onboard the normies. @coinbase finally finds a bottom in Q1 and runs in the Q3/Q4 23

Peter Johnson @TheChicagoVC

3) Custody (finally) starts to separate from centralized exchanges Exchanges will increasingly enable seamless trading from non-custodial wallets and institutional traders will increasingly be able to hold assets with a trusted custodian while trading those assets across venues

NFTs

Even more so than DeFi, lots of predictions on where NFTs are headed in 2022. The predictions here are more varied. Corporations are going to get into it…

Tom Dunleavy @dunleavy89

16. NFTs keep expanding beyond PFPs. At least 3 more major companies launch projects. Ticketing, rewards programs, membership programs, in-game assets all continue to grow. More companies get involved like @Starbucks, @BMW and @Reddit. @0xPolygon is a big winner.