Tech
The 6 most important trends in Web3, blockchain and cryptocurrencies in 2024
The 6 most important trends in Web3, blockchain and cryptocurrencies in 2024
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As we move deeper into the age of artificial intelligence, many questions about privacy and data control remain unanswered. By now, most of us are fully aware that everything we do online involves the generation and sharing of personal data. The centralized nature of the companies and government bodies through which it passes means they have total control over who sees it and what can be done with it. While we trust their privacy policies and compliance with regulations such as GDPR, this does not eliminate concerns about data breaches and theft.
Some say Web3, with its decentralized databases and blockchain-based apps, offers solutions. It promises greater privacy and security, giving us back control and ownership of our data. At least in theory, Web3 tools and technologies, protected by cryptography, are beyond the control or censorship of any single entity, including tech giants and governments.
Although overshadowed by rumors of generative AI in 2023, work on the next generation of web3 apps and technologies continues. Could 2024 be the year these innovations become mainstream? Let’s explore the trends that will define its trajectory over the next 12 months and beyond.
Sustainability in Blockchain and Web3
At the top of the list of concerns is the fact that blockchain and web3 technologies clearly present a sustainability problem. Computing using distributed, encrypted resources simply uses a lot of energy. At its peak in 2022, Bitcoin
Bitcoin
It is estimated that the grid alone consumed the same amount of energy as Finland. In response, more efficient technologies, such as Ethereum
ET
networks’ proof-of-stake algorithms have been developed and green web3 initiatives have emerged. Regenerative financefor example, it has emerged as a way to leverage technology for environmental and sustainable initiatives.
Social network3
Web3 promises decentralized social tools that its supporters say will lead to more private, censorship-free communications and networks, with users retaining control of their own content and data. Transparent, open-source algorithms could help track and block attempts to spread disinformation, with policies administered democratically through blockchain-based voting mechanisms. We’d probably have to look beyond 2024 to see something similar challenge Facebook or TikTok. But social tools like Mastodon based on decentralized principles are already emerging and becoming increasingly popular, so I expect to see continued innovation in this space.
A Bitcoin Bull Run?
Cryptocurrency plays an important role in web3. It is no coincidence that many web3 projects fail when the price of Bitcoin collapses, causing funds to dry up. In 2024, another Bitcoin halving will take place, which has traditionally increased the value of the number one cryptocurrency. Of course I don’t want to make financial predictions, but if this were to happen, it will inevitably lead to an injection of funding and enthusiasm into web3.
Decentralized Finance (DeFi)
Decentralized finance (DeFi) is a term used for an emerging generation of financial services products based on blockchain and web3 technologies. Often, they are built around web3 capabilities to enable peer-to-peer trading and lending, bypassing “middleman” banks and financial institutions with their high fees. In recent years, these products have attracted investment, which means that in 2024 they will be more accessible than ever.
Web3 and immersive Internet
Call it a “metaverse”, if you must. However, many web3 ideas are intrinsically linked to the concept of immersive online environments that mirror the real world. Web3 and blockchain technology have applications in online identity (such as avatars) and the creation of unique digital assets via NFTs. It can also be used to govern and administer online entities, from community groups to businesses, allowing members to democratically elect representatives and vote on the approval of rules and regulations. An easy prediction to make is that the web will continue to evolve to become more engaging in 2024, but we’ll also have a better idea of what web3 brings to the table.
Central Bank Digital Currencies (CBDC)
These are essentially cryptocurrencies issued by central banks. Obviously, since they are under the control of the banks that issue them, they are not decentralized. And they shouldn’t be! Instead, CBDCs can be thought of as attempts to move the technology used to administer financial services onto blockchain infrastructure, where it can be managed more efficiently and transparently. China will continue to pilot its digital yuan into 2024, joining other countries such as the United Kingdom, Bahamas, Nigeria and Sweden that have launched or discussed plans for CBDCs.
High-profile fraud and other crimes
There is no denying the fact that many scammers and criminals have made themselves famous (and often made a lot of money) in the cryptocurrency world that is the basis of web3. The collapse of FTX and the sanctions imposed Binance this year could be just the tip of the iceberg if the industry continues to grow at the pace some predict. With lawmakers dragging their feet, it’s still a Wild West industry. So if you’re going to get involved, be careful.