The Ever-Changing Crypto Narrative: What to Expect in 2024
Layer-3s, superchains, appchains, and chain development kits (CDKs) are among the many advancements in blockchain set to take off in the coming year.3 unknown bull market stories for 2024
Every market cycle in cryptocurrency is like a whirlwind that sweeps investors and enthusiasts into new narratives. These narratives not only capture our attention but also shape the future of the crypto market. In 2017, it was all about initial coin offerings (ICOs), while decentralized finance (DeFi) dominated in 2019. In 2021, nonfungible tokens (NFTs) and the metaverse took center stage. But what will be the main narratives of 2024? Let’s dive in and explore some intriguing possibilities.
Chapter 1: The Battle of CDKs, Superchains, Layer-3s, and Appchains
In 2024, we are likely to witness an intense battle among various chain development kits (CDKs), superchains, layer-3 solutions, and appchains. Polygon, Optimism, Arbitrum, and others have learned from Ethereum’s success and are evolving beyond their current roles as layer-2 scaling solutions. They are establishing interconnected ecosystems of their own.
Imagine a world where major companies like Flipkart, Immutable X, and Libre launch their own chains using Polygon’s CDK. These companies create platforms that other companies can build upon, offering a selection of blockchains with specific characteristics to meet their unique needs. Polygon transforms from a generalist blockchain into an ecosystem of various blockchains with specific jobs to be done and connected liquidity.
It’s crucial to see layer-2 solutions not just as blockchains, but as ecosystems. Polygon is evolving into Polygon 2.0, Optimism has its superchains, Arbitrum is expanding through its layer-3, and so forth. Let the battle begin, and may the best infrastructure, community, and business development team win!
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Chapter 2: Bitcoin’s “Etherization” with Ordinals
In 2023, the Ordinals protocol propelled the Bitcoin (BTC) network into the world of nonfungible tokens (NFTs) and fungible token issuance. While Bitcoin NFTs are fun and generating market volume, the real value of the Ordinals protocol lies in the Pandora’s box it opened.
Discussions about different use cases for Bitcoin, beyond being a store of value, gained traction like never before. Solutions like BVM enable the creation of a Bitcoin layer-2 (L2) using networks such as Polygon and Celestia for data availability, and Polygon and Optimism for execution functions.
With approximately 200 testnets already created from the BVM infrastructure, it’s evident that significant developments are underway to introduce L2s and smart contracts to Bitcoin. This wave of innovation is reminiscent of the DeFi explosion witnessed on Ethereum in 2019. Brace yourself for unimaginable things happening on Bitcoin in 2024, like Circle or Tether natively issuing their stablecoins on it, possibly through the Taproot Assets protocol of the Lightning Foundation.
Chapter 3: The Rise of Digital Identities
Digital identities have piqued the interest of both governments and the crypto underground. Central bank digital currencies (CBDCs) play a critical role in driving this trend. In Brazil, the Central Bank is actively conducting tests with major banks and companies, exploring the potential of CBDCs to serve as foundations for digital identities. Over 130 countries are also working on CBDC initiatives.
In addition to institutional adoption, airdrops are another trend that encourages the adoption of digital identities. To address the challenges associated with airdrops, future major airdrops may incorporate a validation layer based on digital identities, as Linea has done in its ecosystem.
In a year characterized by advancements in CBDCs and airdrops, discussions and solutions surrounding digital identities will take center stage. Both mainstream traders and “degens” will contribute to the ongoing narrative, shedding light on the importance of secure and reliable digital identities.
🔒 Invest and Engage 🔒
As the crypto market continues to evolve, it’s crucial to stay informed and make strategic investment decisions. 🔍 Dive into the articles below for further insights:
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Stay curious, stay connected, and remember to share this article with your fellow crypto enthusiasts! ✨💻🚀
Note: Lugui Tillier, Chief Commercial Officer of Lumx, holds investments related to Polygon, Optimism, and the Ordinals protocol, although none are mentioned in this article.
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