During the last cycle, we have experienced many trends that have led the market. The cash inflow throughout has caused some projects to grow extremely strongly. Let's take a look at a few names that are not very strange such as DeFi Summer, Layer 1 Wars, Ponzinomics, GameFi, Metaverse, etc. and many people have been fortunate to change their lives after a short time by following these trends.
So in the next cycle, what trends will the market stand out? Let's find out with Holdstation through the article below.
- AI is becoming the top concern of the community today
- NFT combined with DeFi opens the door to the "digital photography" industry
- Omnichain increases compatibility between different chains
- SocialFi is being used more and more widely by the community
- Ethereum's Layer 2 solutions are increasingly evolving in terms of project quality as well as technology that is compatible with the parent chain
- Synthetic assets open the gateway between the traditional market and Cryptocurrency
- Real Yield is gradually escaping the trend and becoming a common standard of projects
- Decentralized exchanges saw a spike in user numbers this year with multiple collapses of centralized exchanges
- Crypto market demand for options trading is increasing
- DAO is being widely applied by many projects as well as investment funds in the operating and voting model
- The model of asset management as well as the optimal aggregation of interest rates for users is growing and has great value for supporting new users to enter the market.
AI (Artificial Intelligence) has appeared for a long time and is always expected to be a world technological push to support people in many fields. Because of the complexity, this industry has not really exploded. However, in early December 2022, OpenAI - an AI research and development organization - successfully released ChatGPT - an AI chatbot system that provides automated chat services with customers. This event is like a milestone marking a new development. Immediately, a number of AI crypto projects received attention and attracted inflows of money.
FETCH is a network that provides the necessary tools to build a decentralized economy that happens automatically thanks to AI technology. Users can request or train organizations to do transactions on their behalf such as Sell property to the highest bidder during the auction period,...
- $FET - payment token on the network.
NUMERAI is a decentralized stock prediction platform incorporating a staking platform built by a hedge fund.
- $NMR - payment token and staking reward.
OCEAN PROTOCOL is a data exchange that creates a marketplace to issue and purchase information through a Computer-to-Data mechanism to ensure privacy.
- $OCEAN - means of payment for data trading and staking rewards.
SINGULARITY NET is a decentralized AI trading marketplace on Singular Network. Developers can provide AI services such as text generation, text summarization, speech cloning, speech separation, etc.
- $AGIX - means of payment for services, allowing businesses to use the marketplace through fiat gateways, and staking rewards.
ALETHEA AI is a decentralized platform that enables the creation of interactive intelligent NFTs (iNFTs) in the Intelligent Metaverse world by applying AI Animation.
- $ALI - governance and rewards.
IEXEC is a marketplace for trading computing resources, data and applications. In addition, the platform also provides oracle creation services.
- $RLC - means of payment and staking.
The Graph is a decentralized data query tool that does not need to be connected directly to a network or through a 3rd party organization such as Etherscan. The Graph is like Google for blockchain and users can search for information about token supply, transaction history of a wallet address, etc.
- $GRT - means of payment, governance and staking.
COTEX BLOCKCHAIN is a blockchain infrastructure that supports the implementation of AI algorithms and dAPP powered by AI.
- $CTXC - transaction fees and miner rewards.
Maybe the recent growth is just temporary FOMO of the market in the face of good news, but it is undeniable that the combination of AI and Blockchain will ensure the security and facilitation of web3. It will take time for this technology duo to achieve widespread popularity, but AI is also considered a good marketing method for projects, so investors can surf the short-term bull waves and the reputation of the company. The project books mentioned above are well worth following.
NFT combines DeFi
Q3/2021 to Q1/2022 is a period of strong growth for the NFT market with many deals worth more than $10 million for an NFT PFP. However, this field still faces limitations in terms of liquidity and practical application when most of the current NFTs are still in the PFP NFT (Profile Picture NFT) array and have mainly collectable value. Therefore, it is not surprising that the "bubble" burst right at the time when the general economy was in decline.
However, the potential of this technology will be great if it is well exploited and creates value for owners. Some projects have been actively building infrastructure to increase the use of NFT such as being able to use NFT for collateral or instant NFT transactions through the pool, and even Long/ Short NFT ⇒ Optimize capital and increase investment opportunities.
Therefore, the list of projects that combine NFT and DeFi (decentralized finance) needs to be kept in mind to include in the portfolio for the next growing season.
Some pretty promising protocols are as follows:
- NFTY Finance is a Peer-to-Pool NFT lending and borrowing market creation platform on the Ethereum ecosystem. Currently, the project has just released the Testnet version, so investors can participate in the experience early and maybe have the opportunity to receive the Airdrop.
- GigaSwap is an OTC NFT and token trading platform that allows users to swap assets instantly without having to go through a third party. The protocol is in the testnet stage so further observation is needed.
Each blockchain today is designed to optimize in some aspect and operate separately, such as Ethereum which emphasizes security or IMX which is more suitable for gaming platforms due to speed. This makes ecosystems limited in interaction and data transmission as well as expanding to attract new cash flows. If users want to transfer assets from one blockchain to another, they have to go through many complicated and sometimes not very secure steps.
Although many cross-chain solutions have been built to overcome this problem, they only work for blockchains with similar features, such as from Ethereum to Polygon, but cannot connect Ethereum to the Bitcoin blockchain.
Therefore, as the market grows, Omnichain protocols will be appreciated for their design to provide data transfer between any two contracts on separate blockchains, regardless of network connectivity, token or consensus mechanism. Some typical projects in this field include:
LayerZero is a protocol that provides the Omnichain infrastructure for developers as well as users to transact between different blockchains. Although it has been out for a while, the project has not released tokens yet, so this will be an opportunity for users to hunt for airdrops through the use of products.
Detailed instructions on airdrop hunting strategy from LayerZero HERE
ZetaChain is a Layer1 omnichannel smart contract platform that connects all blockchains like Ethereum, Polygon, BNB (BSC) and even non-smart contract blockchains like Bitcoin and Dogecoin without using a bridge or wrapped tokens. The project is in the testnet stage and deploying the testnet experience campaign, so there may be an airdrop in the future.
Detailed instructions for participating in the ZetaChain testnet:
ZetaChain Testnet - Guide to Join the Omni-chain Layer1 Airdrop Hunt
SocialFi stands for Social Finance. This is a combination of decentralized finance on social networking platforms. Taking applications from existing social networks, socialFi platforms support users to earn money by creating content, playing games, and taking popular quizzes about crypto and blockchain, ...
Unlike the social networks inherent in Web2, with SocialFi, when blockchain technology is applied, user information will be provided with a higher level of privacy and security. Issues related to revenue and profit sharing will also become more transparent with the application of decentralized databases.
In a word, like copying trading, for example, instead of having to follow a signal on Twitter from a KOL to enter an order. Through SocialFi, users can surf social networks and enter orders through a KOL article with just one click thanks to smart contracts without performing other cumbersome procedures, thereby creating a system called social trading.
We can mention a few outstanding SocialFi projects such as:
- NestedFi: The project supports building, managing portfolios, copying trades of the best traders and supporting social trading with just one click
- STFX: SocialFi Protocol for Short-Term Digital Asset Management
- Hooked Protocol: The 29th launchpad project recently invested by Binance
- Lens Protocol: Project made about Social Graph and running on Polygon network developed by the founder of Aave
Layer 2 Wars
During the downtrend phase, the money flow is usually only concentrated in Ethereum, however, the development roadmap of Ethereum is very long and is only in the infancy stage, still has to develop quite a long way, it takes a long time to become one. a comprehensive chain such as low cost, high speed,...
During that time, layer2 on Ethereum was born as an extension of this network to solve the main problems in the blockchain industry, which are scalability, speed, and security. Layers will bring high scalability to Ethereum, making it easier for projects to build on these layers, and at the same time make it easier for users to access and adapt to crypto, in addition to solving problems. on the cost issue when the transaction cost on layer2 is much cheaper than Ethereum. On the other hand, inheriting the security of the Ethereum network itself.
Arbitrum and Optimism can be mentioned the two largest Layer2 on Ethereum, which grew very strongly during the downtrend period when the number of transactions continued to increase as well as the number of users growing.
In addition, next year, the layer2 war will become even more attractive with the participation of large projects applying zk-rollup technology such as:
- zkSync: As a Layer 2 for the Ethereum network, the project belongs to the same zk-rollup solution group as StarkWare and counterbalances the Optimistic Rollup group of Arbitrum and Optimism.
- Starkware: As a Layer2 project for the Ethereum network, the project also belongs to the group of zk-rollup scaling solutions similar to zkSync.
- Scroll: A project built with a combination of EVM (Ethereum Virtual Machine) and zk-rollup technology, known as zkEVM, on Ethereum to help support compatibility with applications and tools in current Ethereum.
And of course, it is necessary for layers2 to launch their own native token to apply the token for many activities in the ecosystem itself, similar to BNB Chain's $BNB or Ethereum's $ETH, Solana's $SOL. Before that, Layer2 Optimism or Metis also launched their own native token. The fact that layers2 launches next year with tokens is predictable, from which it can be seen that next year's layer2 war will be a race for speed, transaction costs, scalability as well as use cases of layer2 tokens.
Synthetic assets in crypto are tokens that represent and simulate real-world asset classes based on blockchain technology. A synthetic asset in crypto is like a derivative that mimics the exchange rate of a real asset but is not backed by that real asset. Instead, this crypto-synthetic asset simulates the properties of a real asset and is over-collateralized by another crypto asset.
Simply put, synthetic assets in crypto can represent all kinds of real assets such as commodities, stocks, forex, ETFs, oil, gold and many other types of financial instruments. Thereby giving investors more trading options with trading pairs not only encapsulated in each cryptocurrency but also many other real assets.
Traditional markets have huge daily volume, such as the forex market with $6.6 trillion in daily volume, or the Nasdaq stock market's average volume of more than 100. billion dollars per day.
So if in the crypto market, how will investors still be able to trade with such assets? If combining the application of blockchain technology and potential markets such as forex, stocks, or gold, the aggregated asset array in crypto will bring advantages such as:
- Completely decentralized, bringing high anonymity to investors when being able to trade with many types of assets without having to carry out complicated identification procedures like on traditional exchanges. intermediaries, helping to optimize costs
- Working continuously 24/7, for the crypto market that never sleeps, investors can make transactions at any time, unlike the media market that always operates on fixed time frames and does not work. moving on the weekend
- Tokenization of all assets makes it easy for investors to trade and exchange any existing assets on the blockchain.
- Security when applying blockchain technology as well as transparency when all transactions are recorded on the blockchain
Here are a few projects working on synthetic assets, specifically: Synthetix, Dopex, GMX, Kwenta, dYdX,...
Being noticed by the market since about August 2022, Real Yield has gradually found its place in the "DeFi Pie". Now, this model is no longer a word of mouth in the community but has become a big step change for the market. Investors now fully understand the risks in the Liquidity Mining model, they tend to look for models with long-term stability. And Real Yield has fully met those needs.
There have been many new projects using this model and with certain success. In addition, many old projects have also begun to adjust for inflation, gradually replacing them by paying bonuses from revenue or platform fees.
In addition to the reward being paid from revenue or fees, Real Yield also contributes to the user being able to assess the health status of the project. A good project will have a real interest rate with a steady and sustainable APR. It is very likely that this will be the main model leading the market with “DeFi Summer 2”.
Projects using the current Real Yield mechanism:
- Perpertual Dex: GMX, Gains Network, Synthetix,…
- AMM Dex: TraderJoe, Curve Finance,…
- Yield Strategies: Umami Finance,…
Following the collapse of the FTX exchange and the recent FUDs about the lack of transparency on Binance's reserve assets. The market was in a panic, and the main trend was to cash-out your assets or withdraw to your personal wallet. The phrase “Not your keys, not your coins” has also become the word of mouth of the crypto community. The proof is that the number of Dex Users increased sharply at the end of October compared to the gloomy period from June this year.
However, besides the good points, decentralized exchanges also have many limitations that can be mentioned as
- Big slippage
- Liquidity is not deep enough
- Impermanent Loss
- Risk of scams, Smart Contracts being hacked
Some of today's decentralized exchanges
- AMM Dex: Uniswap, Pancakeswap, TraderJoe,…
- Perpertual Dex: GMX, dYdX, Synthetix,…
- Stable Swap Dex: Curve Finance, Wombat Exchange,…
- NFT Dex: OpenSea, Looksrare, Sudoswap,…
And there are many decentralized exchanges that serve different needs of users.
Options trading in traditional finance is very popular. However, there are not too many users in the cryptocurrency market yet. According to data from Coinglass, $BTC options volume at one point hit $15 billion during the peak season. Besides, $ETH Option Trade open volume is also growing starting around mid-July this year.
The centralized exchange that holds a lot of market share in this segment is Deribit, at one time the $ETH trading volume was open to more than 8 billion USD in August 2022. These figures show that options trading is gaining more popularity among investors in the cryptocurrency market.
However, after checking through decentralized Option exchanges, it seems that the demand for options has not had much impact. The proof is that the two Option platforms with the largest TVL today, Ribbon Finance and Opyn Finance, have yet to show signs of cash inflow.
Two Bull-Cases for options trading could grow in the near future:
- If DeFi reflects the needs of the traditional market, when Cryptocurrency grows large enough, the market will also create needs for more complex products and among them, rights transactions cannot be missing. choose.
- Derivatives trading on Dex is more and more popular because of the benefits it brings, many people will start buying options contracts to hedge prices to avoid liquidation.
Some projects on options trading array readers can refer to:
- Ribbon Finance
DAO (Decentralized Autonomous Organization)
All businesses, organizations and collectives in the world must have a leader. This means that all power is concentrated on a certain individual or group of people. The DAO was born to solve that problem and bring about decentralized governance where everyone has equal power and competes in groups of people with the same purpose.
Returning to Cryptocurrency, DAO is probably no stranger to investors participating in the market. But why can DAO become a trend for the next time?
Many current projects are using a tokennomic model in the form of veToken. This leaves the community free to choose and vote according to their wants and needs. In parallel, many DAO platforms were born to help small individuals with the same purpose gather together to create collective voting rights with greater power.
Investment funds are also gradually applying the DAO model to raise capital from the community or vote on strategies to invest in projects. From there, it is possible to share profits according to the percentage of individuals' contributions to that deal. In addition, the DAO also brings benefits to individual users such as rewards from participating in governance.
If the governance models of projects still depend on tokenomic, the DAO will grow more and more.
Some projects on DAO readers can refer to such as:
- Redacted Cartel
Asset Management - Yield Management
For those who are new to the market, having to get used to too many coins/tokens will get them confused. Especially when the market grows larger and larger, the need to buy many different coins/tokens investors is increasing. The need for dApps to manage capital and portfolios is essential. This is most likely a trend that decentralized wallets, SocialFi platforms will target in the future.
Similar to Asset Management, Yield Management also aims to optimize operations for users. There is no need to spend a large amount of money to buy/sell, provide liquidity, etc., but simply buy a token that plays an administrative role, everything about strategy, Farming, Staking, etc. will be planned. project done and you just enjoy the interest return. This is like buying a "fund certificate" but the Farming side and the reward will be returned to the Staked person for that amount of "fund certificate".
Projects about Yield/Assets Management that readers can follow
- Umami Finance
- Dapp Radar
To exploit the opportunity to make profits from Umami Finance and identify the potential of the platform, you can read the following analysis: Umami Finance Staking Guide - A Low-Risk Platform For Passive Income On Arbitrum
In the next cycle, catching a new trend as well as related projects is very important in the crypto market in order to catch the inflow of money and the outstanding projects mentioned above will be the ones that will benefit. Firstly, we can review the narratives as follows:
- NFT combines DeFi
- Layer2 Wars
- Synthetic Assets
- Real Yield
- Decentralize Exchange
- Option Trade
- DAO (Decentralized Autonomous Organization)
- Asset Management - Yield Management
The information, statements and conjecture contained in this article, including opinions expressed, are based on information sources that Holdstation believes those are reliable. The opinions expressed in this article are personal opinions expressed after careful consideration and based on the best information we have at the writing's time. This article is not and should not be explained as an offer or solicitation to buy/sell any tokens/NFTs.
Holdstation is not responsible for any direct or indirect losses arising from the use of this article content.