Binance Research’s analysts are keeping a close eye on a number of developments that might have a significant impact on the cryptocurrency market in 2023.
In 2023, according to a recently-released report (“Full-Year Review 2022 & Themes for 2023”) by Binance Research, macroeconomics will be the driver of returns for risk assets. Whether macro factors operate as a tailwind or headwind for crypto will be determined by central bank policy, global GDP statistics, and recession risks. According to Binance Research, there may be a stronger relationship between traditional and crypto markets as the crypto market develops and more institutional players enter the field.
Another one of their predictions is that real-world assets will be used as a growth driver for DeFi and NFT initiatives. Asset tokenization or the acceptance of real-world assets as collateral are two potential integration points with physical assets.
With regard to Ethereum’s upcoming Shangahi upgrade, they anticipate more interest in staking as the day for withdrawing staked ETH draws closer. This may be helpful for liquid staking methods, but it is also likely to cause fluctuations in market share. An example of this could be a market share shift from Ethereum 2.0 to other liquid staking protocols that offer better returns or user experience.
Binance Research also is of the opinion that NFTs’ usefulness will be crucial to their widespread acceptance in the future. More innovation in areas such as integrations with blockchain games, collaborations with Web2 enterprises, and other real-world use cases is anticipated to drive the next adoption phase and move beyond simple image NFTs.
Lastly, Binance Research believes that increased regulatory clarity for cryptocurrency is coming. Regulators’ skepticism makes sense, and it will be difficult for crypto to win back the public’s confidence. However, the blockchain industry would benefit from increased regulatory certainty in the long run. An example of this could be a government that creates a clear regulatory framework for Initial Coin Offerings (ICOs), which would provide a more secure environment for investors.
As for their review of 2022, the report said there was a lot of volatility, with various developments and changes in the market. Ethereum adopted a new method of validation called Proof-of-Stake and new L1 blockchains, such as Aptos, entered the market. The layer-2 scaling solutions saw significant growth, but the overall DeFi sector faced a drop in value. The NFT market had a good start but slowed down later in the year. The blockchain gaming industry continued to grow, but there were indications of slowing down and less interest in the virtual world concept. The policy debate was fueled by multiple events in the year, and there was a spike in venture capital investment and fundraising activities.
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