On January 8, Bankless Nation members of the cryptocurrency community released their predictions for 2021, including Bankless project founder Ryan Sean Adams, Bankless founding member David Hoffman, and Bankless editor & analyst Lucas Campbell, who published their predictions for the cryptocurrency industry in 2021.
In the past 2020, we have seen:
PayPal starts to support cryptocurrencies
Multiple public companies collectively bought billions of dollars worth of Bitcoin
Eth2.0 officially released
Uniswap's trading volume surpasses Coinbase
Mini Mania in DeFi
The value of $20 billion is locked in DeFi ($60 million at the beginning of this year)
Central Bank implements unprecedented monetary stimulus policy
Global COVID-19 pandemic
2020 is an eventful year, and no one can predict what will happen in 2020.
However, we still try to predict 2021.
Below is Bankless's cryptocurrency forecast for the next twelve months.
The consensus forecast reached by the Bankless team:
ETH will cross an all-time high and reach $2,500. As you know, we are actually more bullish than $2500, so this is our layup prediction.
Cryptocurrency has become a trillion-dollar asset class. Our total market value has just reached $1 trillion. We will maintain this level and go beyond.
Ethereum will settle more than 3 trillion dollars in value. In 2020, the Ethereum network will achieve a value settlement of more than 1 trillion. Next year, we expect more dollars, more bitcoins and more capital inflows on the network than ever before.
At least two DeFi protocols will reach the top 10 of the cryptocurrency market value rankings. Some coins in the top ten assets are stupid (we will not specify XRP). We think they will be replaced by DeFi capital assets, which have actually been valued. The candidates that may enter the top ten include: AAVE, UNI, YFI, COMP, SNX and MKR.
The total market value of DeFi will exceed $100 billion. Our current DeFi market value is only $28 billion. too low. Major agreement upgrades, improved products, and new agreements to be launched next year... US$100 billion can only be regarded as our conservative estimate.
BTC on Ethereum will exceed 2.5% of the total Bitcoin supply. By the end of this year, the number of BTCs on Ethereum will reach 420,000, and we currently have 160,000. The high returns and practicality of the Ethereum economy will cause more and more participants in the new ecosystem to choose to use BTC on Ethereum. Who knows, people may even start using BTC exclusively on Ethereum.
Coinbase's IPO valuation will exceed $100 billion. This is largely driven by the huge tailwind behind the crypto asset mania. Note the comparison with Tesla.
At least two major banks will use Ethereum as the base layer to settle U.S. dollar payments. The U.S. Currency Attorney's Office recently issued guidelines that allow U.S. banks to use public blockchains and stablecoins as the U.S. settlement infrastructure. The current prospects are promising. If banks adopt the technology, the guidance will enable them to significantly reduce costs and increase efficiency. (Oh, in fact, these saved money will not be transferred to the customer, because the bank’s rent-seeking efficiency is not high. The user still has to wait 1-3 days before the transfer can be made, and the fee of 30 US dollars will be paid. There is a limit on the amount to send.)
Next are the respective predictions of Bankless team members:
Ryan Sean Adam:
The market value of stablecoins exceeds $250 billion. There are three growth engines here. First, mortgage and non-mortgage DeFi agreements. Second, crypto banks based on stable currencies such as USDC and GUSD. Third, traditional banks will participate. These three engines will bring the stablecoin market to $250 billion.
After the Ethereum improvement proposal EIP1559 went online, we started to burn ETH. Currently, with the help of Tim Beiko and others, I finally see the momentum of implementing EIP1559. This is the engine for Ethereum to move towards scarcity. This is the last problem of ETH monetary policy. This means that the agreement will begin to destroy the ETH fees generated by each transaction.
Internet bonds have become a reality. Institutional investors will be surprised to see the price of Ethereum rise. After the launch of ETH futures, some people will participate, and then more people will participate. When they do, they will upgrade their narrative to rationalize their ETH bets. They call the collateralized ETH an internet bond, just as they call BTC digital gold. Looking forward to using this meme to get articles from Forbes or Bloomberg. Maybe it was what Paul Tudor Jones said on CNBC.
The central bank will get bitcoin. Either they do this work in secret and we will discover it, or they declare that it is for political purposes.
You will receive a text message about Bitcoin. We will enter a FOMO mood similar to 2017. Friends and family members who know your activities in the currency circle will ask you for advice and hope you will guide them.
The digital renminbi will be launched and will be successful, and the United States will be forced to consider adopting a digital currency strategy.
These are some discussions and no action has yet been taken. I expect this will be the main issue approaching the next 4-year election cycle, which may be related to MMT, UBI and China's dominance.
David Hoffman:
At least one unsecured/algorithmic stablecoin will reach a market value of $1 billion. And it will remain above that level in the first half of 2021. This unsecured stablecoin will become stable enough and will eventually be included in Curve.
At least one unsecured/algorithm USD stablecoin will also thunder. Like a death spiral. Hope it was not included in Curve at that time.
The tokenization of real-world assets will continue to perform poorly. We have not found effective legal procedures to complete this work. This will bring benefits to local assets on Ethereum, as there is less competition for capital and easier creation.
For most of this year, Ethereum's dollar-denominated yield will maintain an APY above 10%. At some point, they may even break through 30% during fluctuations. As revenues continue to shrink in traditional markets, the fact that anyone will be able to obtain these benefits will become one of the key drivers of interest in Ethereum.
At least one large game studio will announce its intention to integrate certain components of Ethereum into its NFT asset integration in its games. This will be possible to a large extent when L2 Rollup provides the infrastructure for tradable game assets and provides the latency and speed required for an impressive gaming experience.
Due to protocol design errors, the L1 versions of the following protocols will not be subject to hacker attacks, exploitation or loss of user funds. Eligible candidates include Maker, Aave, Compound, Synthetix, Uniswap. Please note that incorrect ERC20 tokens from third-party teams are not counted!
Due to a certain strategy error, Yearn will lose some user funds.
USDC will be close to rival Tether in terms of total dollar supply. Tether will face strong regulatory resistance, which will benefit the growth of USDC.
The supply of stablecoins on all other non-Ethereum blockchains will be an afterthought. Almost all the supply of encrypted stablecoins will be on Ethereum. There is almost no other place to use it.
Tron will follow the old XRP path, one way or the other. Maybe the regulator will take action and start cracking down.
There will be an unsustainable social token frenzy. Major celebrities and influencers will mint tokens named after themselves and then airdrop them to fans. They will have a ridiculous market value.
No important new L1 will be launched. There is not much to say here.
Decentralized pledge as a service provider will be subject to a lot of hype and speculation. This may be too early, because they will not really matter until the merger of ETH 1 and ETH 2, which will not happen in 2021.
The focus of the desktop use cases of Ethereum and DeFi will lose its dominance over the use of mobile applications, because new entrants entering the ecosystem use fewer desktop applications and become more accustomed to the mobile environment.
The use of desktop DeFi will continue to be dominated by MetaMask. The growth of mobile DeFi usage alone will not weaken MetaMask's dominant position, nor will it be replaced by competitive desktop applications.
Discord will become the main platform for discussing cryptocurrencies, and Telegram will withdraw.
Facebook's Libra (which has been renamed Diem) will be launched, and no one will really care about it except for regulators.
Lucas Campbell:
Uniswap's annual transaction volume will reach $1 trillion. The current daily transaction volume of the agreement is almost 1 billion US dollars. According to this rough algorithm, it means that the daily transaction volume only needs to reach 3 billion US dollars-according to the current growth rate and the upcoming Uniswap V3 upgrade, this is not an unrealistic goal.
The sales value of encrypted artworks will exceed $1 billion. For reference, the current scale of digital art on the main platform is about 24 million US dollars per year (not including Nifty Gateway). This is a small scale, and the digitization of this asset class can greatly increase liquidity. Now, ownership can be instantly transferred to anyone anytime, anywhere. Equally important, the scope of digital art is broader. A work of art can not only have visual aspects, but also audio. What if NFT is the cover artwork for Taylor Swift's new album, and this new album is also the album's hit single? How much will it sell? Once a few popular creators realize this potential, the story will write itself.
There will be a black swan event like The DAO. The smart contract audit company is now fully operating at full capacity. Currently, you need to queue for several months to arrange for any well-known company to conduct an audit. There are a lot of tasks in the hands of auditing companies that need to be continuously advanced. Sorry to say, but in this case bugs are likely to occur, one of which is very costly. Hope it is not Eth2...
The market value of DPI exceeds $1 billion. The index industry has begun to take shape, and DPI as an index cooperative has only appeared for a few months, most of which are in the DeFi bear market. This will become an asset for new cryptocurrency investors to enter DeFi. All DPI needs to do is to obtain enough liquidity to allow major head companies (such as Coinbase and Binance) to list it. Once this happens, by (1) increasing liquidity and (2) index underlying asset prices rising (another DeFi bull market cycle), it is enough to push DPI to unicorn status.
In terms of driving user attention, retroactive token distribution will become very profitable. There are many projects that can be tokenized. Retroactive token distribution to past users of the agreement has become an industry standard. I won’t be surprised if more projects with unissued coins launch their native tokens next year and distribute large supplies to historical users. This does not include new projects that want to arouse interest (such as Mirror and Badger), or even existing tokenized projects that want to reward old users for special operations done in the past (projects that reward users for migrating to L2, or once migrated to V2 Wait, the project will reward V1 users).
DeFi derivatives will flourish. In 2019, we have stablecoins and loans. In 2020, we have AMM. In 2021, we will see that the field of derivatives will eventually play an important role. We have reached the point where we finally have a robust derivative protocol ecosystem on the main network. Highlights include: Synthetix and UMA for synthetic assets, Hegic and Opyn for options, FutureSwap, dYdX and Perpetual Protocol, and other products for leveraged trading products. My guess is that we will eventually see these agreements begin to appear in the trillion-dollar derivatives market.