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- Weekly Recap - Dec. 17th
Weekly Recap - Dec. 17th , 2023
Top News Headlines
Top Crypto Prices by Market Cap.
1. Bitcoin $40,993.55 7D -2.3% | 6. Cardano $0.570 7D 3.4% |
Source: Coingecko Price Feed, Dec. 17th 2023, 10:25pm EST. Data excludes Lido Staked Ether, and stablecoins USDC and USDT.
Spotlight: Coinbase 2024 Market Outlook
With the holiday season fully underway and the New Year right around the corner, it’s time to look ahead at the key trends driving the digital asset industry forward!
Before we dive into the Coinbase 2024 Crypto Market Outlook, let’s quickly recap how the industry performed in 2023…
The total crypto market cap effectively doubled in 2023: rising from ~$750B at the beginning of the year, to it’s current level of ~$1.5T. Congrats to everyone who stuck around during the bear market and finally made some $.
This year’s comeback was mainly driven by:
Rising geopolitical conflicts reinforcing Bitcoin’s status as a safe haven asset
A dozen spot Bitcoin ETF’s being filed by top U.S. institutions, with unanimous approvals expected in 2024
Innovative new use cases across Tokenization, Decentralized Physical Infrastructure, AI x Crypto, and Web3 Gaming bringing thousands of new users and billions of dollars back into the space.
So, what’s in store for 2024?
Key Theme #1: The Next Cycle
According to Coinbase’s Institutional Research group, the next crypto cycle will be dominated by a couple key points:
Bitcoin will remain king - institutions will continue to favor ‘safer, high-quality’ digital assets like Bitcoin. The ETF narrative will continue to bring new inflows into BTC, and then ultimately to riskier crypto assets as the cycle progresses.
Evolution of Layer 1s and Layer 2s - The rapid growth of new layer 1 blockchains (Solana, Avalanche, Injective, etc.) will continue to capture larger market shares as users look to escape the latency and higher fees of Ethereum. These blockchains will also become more specialized - focusing on use cases like gaming and DePIN. At the same time, layer 2s like Arbitrum and Optimism will compete heavily with each other for Ethereum mainnet volume.
Key Theme #2: Resetting the Macro Framework
Coinbase researchers also believe next year will provide the favorable macro tailwinds for risk assets to bounce back across the board. LFG!
The continuation of the disinflation trend, softer US economic activity, Fed cuts, and, perhaps most critically, the foundations for crypto regulation will continue to be built, facilitating long-term adoption.
Key Theme #3: Connecting to the Real World
Tokenization - Tokenization is a vital use case for traditional financial institutions and we expect it to be a major part of the new crypto market cycle, as it is a critical part of “updating the financial system.” 2024 will see more and more FI’s embracing tokenization, and it will be important to watch the regulatory progress being made in jurisdictions like Singapore, the EU, the US, and the UK.
Web3 Gaming - this subsector of crypto had a resurgence of interest in 2H23 after a steep drop in transaction activity in the early stages of the most recent crypto winter. In 2024 we should expect to see the release of many AAA games built by legends from the traditional video game industry, infusing all of the wonderful financial mechanisms crypto has to offer.
Decentralized Identity - Privacy is a new frontier for blockchain developers, who are leveraging innovations like zero-knowledge (ZK) fraud proofs to enable computations on user data while still keeping that data encrypted. The applications for this technology are extensive, as it enables an end-state where users have full control and ownership of their personal data.
Key Theme #4: Future of Blockchain
Better User Experience - one of the biggest themes to emerge from the recent bear market cycle is a focus on how to make crypto technology more user friendly and accessible. The added responsibility of managing crypto (wallets, private keys, gas fees, etc.) is not for everyone, and Coinbase predicts 2024 will give rise to a whole suite of new applications deigned to streamline the crypto UX and onboard the next billion users to the industry.
For more predictions check out the full 2024 Crypto Market Outlook by Coinbase!
As always, thank you for reading the Weekly Recap by Digital Asset Insights, and please share with your friends and family!
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