As 2024 is closing in and the bull market still seems to be primed it's time to take a look at what 2023 brought us and what it could mean for 2024 and the crypto world.
Tokenization
Tokenization such as RWA (Real World Assets) has been a major focal point for many. Two of my latest articles go over this in detail Surging Interest in RWA and USDT Real World Asset Tokenization
With a drastic increase in what is known as institutional investments it's clear that tokenization will be a center point of that. Take into account taxes and how things are taxed. For example when a trade is made or non-qualified dividend is sent it's a taxable event right then and there. While something like a ETF is a tool to defer tax obligations. That's done by reinvesting the dividends earned on the ETF back into more ETF shares. The benefit to this is you only have to pay taxes later allowing you to keep more capital now which can be compounded.
Now to the every day person this might not be a lot and you most likely wouldn't really notice it. However throw in $250,000+ and you'll quickly see thousands of dollars in difference each year.
This new tokenization could open up even more options to save on taxes such as in the form of trusts. a TAF token could allow a family to reinvest funds on the regular and not pay any taxes on those gains until they finally cash out.
DeFI
DeFi had a rough ride in the last bull market. In 2022 still defi platforms lost over 53 billion dollars due to hacks and other frauds and screamed from everyone that something had to be done. In the bear market of 2023 things really slowed down. To the point of only seeing 1 billion dollars extracted from hacks a small price compared to 2022.
But what might 2024 hold for DeFi? Could we see large hacks return or have DeFi platforms and people learned their lesson?
I'm a firm believer that most people really don't learn lessons and as market caps go up scammers with come out of the woodwork again. DeFi is also far smaller than what it once was. But I often question that as I've seen plenty of new and other internal liquidity pools for games etc which simply are not counted into sites such as defi Llama etc.
This very well could mean billions more are still in DeFi but it's far more decentralized now. We also should admit that while fraud and hacks are down to just 1 billion dollars that's still a lot of money and in a truly decentralized and trustless system there needs to be a better way and one where these things simply no longer happen.
It should be very clear that 2024 is going to be the year of the bull market and that DeFi will need to do much better if it wants to survive. New features such as smart contract pauses and NFTs for digital identity to verify transactions could be a small step into improving that overall infrastructure.
Scalability
One thing about blockchains is still clear. They simply are not fast enough or big enough and I'm not sure if one will ever be. That's because we as humans will find a way to eat up all of that data and always say it's not fast enough.
The most recent mega issues in this are what's known as inscriptions where everyone is taking profile pictures and whatever else and inscribing them to the blockchain. Cause major downtimes and bottlenecks in not only bitcoin but many other blockchains who have seen partial to full outages in the last few weeks. This is ahead of the so called bull run as well I might add.
This started with Ordinals which allows any text, image, video etc to be inscribed directly to the blockchain like bitcoin. This is done in replace of platforms that do not use smart contracts (Kind of like here on the hive blockchain which makes me wonder if Ordinals would be a thing here but it seems to be limited to EVM chains) The issue whoever with all of this is a lot of the data and calculation is done off chain and we could get into a whole mix about how they work but I found this great X tweet that goes over it in better detail here > Inscriptions on Blockchains What They Are
Posted Using InLeo Alpha
