Pantera’s Paul Veradittakit’s 2021 Predictions

It has been an eventful yr, to say the least. By way of blockchain and crypto, we noticed a number of key developments: the halving of Bitcoin, liquidity mining and the explosive progress of a number of decentralized finance (DeFi) purposes, stronger instruments for blockchain interoperability and way more. 

As 2021 begins and the globe slowly eases its approach out of the COVID-19 pandemic and related market fluctuations, I sit up for seeing much more progress within the innovation, widespread use and various impacts of blockchain applied sciences. The house is turning into concurrently extra complicated and extra accessible, broadening the horizons for what the crypto neighborhood can obtain in constructing decentralized, user-first monetary programs.

Here’s a assessment of my predictions from final yr. Together with a abstract of how that house or development fared in 2020, I’ve included an accuracy ranking to evaluate how properly the prediction held up, with one being least correct and 5 being most correct.

See additionally: Pantera Associate Paul Veradittakit’s Crypto Predictions for 2020

Given Diem’s eventful (within the regulatory sense) public reveal in 2019, I anticipated 2020 to be an equally thrilling yr for Fb’s challenge by way of growing a popularity, preventing key regulatory battles and starting to construct up adoption. Quite the opposite, Diem’s launch was delayed and it stayed predominantly beneath the general public radar all through 2020. 

In April, the affiliation introduced it might make key modifications to its structure to handle a number of the fundamental regulatory considerations introduced towards it. The governing affiliation additionally renamed the challenge from Libra to Diem, and the pockets was renamed from Calibra to Novi. Most lately, key people within the initiative claimed that the platform may launch as early as January 2021. Even when Diem didn’t catch the general public eye as a lot in 2020, it undoubtedly made some key developments behind the scenes. Moreover, with the groundbreaking federal antitrust lawsuit towards Fb, Instagram and WhatsApp, the challenge is prone to get considerably extra consideration within the months forward.

Bitcoin’s halving from a block reward of 12.5 BTC to six.25 BTC in Could of this yr definitely garnered a whole lot of widespread consideration, however the precise impact of the halving occasion on the value of bitcoin continues to be ambiguous. There was a muted response to the halving occasion: A couple of days after, the value even dropped a bit. Some consultants proposed the halving had been “priced in” within the months main as much as it. In different phrases, as a result of buyers anticipated bitcoin’s value to understand the value naturally inflated earlier than the halving occasion, making the precise change following the occasion much less noticeable. 

Even when not speedy, the halving definitely had a significant impact on the long-term outlook for bitcoin and the macro narrative that has since dominated the dialogue with conventional buyers on bitcoin’s potential.

See additionally: Bitcoin Halving, Defined

Sadly, in 2020 we didn’t see that many new developments within the blockchain house for gaming, and definitely not many public dealing with launches. Many recreation builders nonetheless face an excessive amount of technical friction by way of constructing on chain, as a result of its complexity and infrequently gradual runtime. Nonetheless, the curiosity within the idea has not subsided. Many recreation creators are exploring how non-fungible tokens (NFTs) can be utilized as useful digital belongings in video games. 

A number of studios, together with Pixelmatic, Ubisoft and Atari have all claimed that blockchain applied sciences may play vital roles of their video games sooner or later, and are starting to actively discover the idea. As of as we speak, one of the vital promising and well-known blockchain video games is The Sandbox, a recreation sort of like Minecraft the place customers can monetize digital belongings through the blockchain. The Sandbox has already introduced partnerships with main recreation builders together with Atari and Sq. Enix.

If nothing else, 2020 was the yr of DeFi. One of many greatest traits of the yr, undoubtedly, was liquidity mining. To maintain it easy, liquidity mining is actually the place customers provide their very own belongings as liquidity to a protocol in trade for a protocol’s governance token. Over time, as a result of plenty of curiosity, this governance token will increase in worth, typically producing immense returns for liquidity-supplying customers and incentivizing them to maintain supporting the DeFi protocol. This yr governance tokens for Compound, Balancer, Yearn.Finance and lots of extra launched and exploded in worth. Additional, the worth generated…