We all want to know what the future holds after the end of a tumultuous year that very few people saw coming. What will blockchain and cryptocurrency trends continue shining to 2021? In this article, we will be looking at five top predictions for crypto and blockchain in 2021.
DeFi: Sustainable or Bubble Growth?
One takeaway that is anticipated to trend in 2021 is the DeFi. According to Sonic Capital, Stefan Rust, DeFi, which grew exponentially this summer, has been making for four years. The growth of DeFi led to yield farming and decentralized exchanges (DEXes) exploding in popularity.
Radix CEO Piers Ridyard revealed that 2021 might not feel like a big year as 2020 did for DeFi and that the hype might slow down a bit. However, the actual progress being made will make 2021 the biggest DeFi year. Piers Ridyard further predicted that 2021 might not be enough for DeFi to get where it is supposed to be. However, it will not take long before the established finance players decide how to co-opt DeFi without them being co-opted like the music and media publishers did before them in the internet age.
It is time for more regulations
There can never be growth forever. There is a time when DeFi will become defy. The community needs to take lots of precautions and develop frameworks that will help accommodate the growing demand. Governance and regulators will have to reckon with the incumbents while trying to grip the nascent space. This will most likely result in a considerable defiance sort between the two groups of actors.
The regulatory commissions have, for a long time, eluded the crypto world. However, in 2021, there are high chances that government agencies and other regulatory bodies will take action.
Everything will get tokenized
Where there was a single BTC (bitcoin), there are currently countless tokens that range from utility to governance to security tokens and much more.
Hedera Hashgraph co-founder, Mance Harmon, predicts token proliferation combined with “componentized” finance. DeFi will create a market for the adoption of enterprise in 2021.
There are NFT (non-fungible tokens) that make a digital item unique. They are already being used in video games, collectible virtual pets, and fine art. In 2021, expect to see wider tokenization and NFTs applications.
Increased CBDCs momentum
With reports concerning the latest Digital Currency Electronic Payment (DCEP) trials, China’s new digital currency is continuing to flow outside the country. Harmon of Hedera Hashgraph, “What China is doing with the CBDC efforts and Blockchain Services Network makes them a few steps ahead of the rest in terms of DLT focus and efforts.” Other country’s CBDCs momentum is being spurred by China’s development together with geopolitical implications. Most of the central banks around the world are racing to develop their cryptocurrencies.
The coronavirus pandemic has accelerated the digitization of things. More digitization, especially in the finance department, is expected in 2021. This will see more companies beginning to accept cryptocurrency.
The new DCEP digital currency in China is one of the many projects which will make Asia a continent to watch out for when it comes to blockchain and other related areas like digital ledger technology. Blockchain innovations in the supply chains in China will disrupt and secure the industry worldwide.
D’Haussy predicts up to 25% of Asian banks will offer digital asset custody in 2021. Together with a combination of significant Asian exchange acquisitions in 2021, the prospect will make Asia among the top in blockchain adoption.