Webull CEO Anthony Denier argues that most professionals predict there will be crypto regulations in the coming year.
Next year should be important for CRYPTOCURRENCY like decentralized finance (de-fi) economy continues to expand and sees greater participation from individuals and institutions, according to industry experts.
Crypto experienced incredible ups and downs throughout 2021, with Bitcoin hitting its all-time high as well as one of the biggest drops in the crypto market when that value was cut in half. This year also saw non-fungible tokens (NFTs) achieve widespread awareness as celebrities began to jump into the space with their own products.
But what does next year hold for de-fi and cryptocurrencies?
The White House is considering extensive oversight of the cryptocurrency market to combat the growing threat from ransomware and other cybercrime, a spokeswoman said Friday. (iStock / iStock)
The future of cryptocurrencies will depend on three main factors: energy efficiency, adoption, and regulation.
Regulation will prove especially important after a major change in 2021 that caused the federal government to decide to start taxing cryptocurrencies the same way it would stocks, effectively removing the "wash sale" loophole that many crypto investors they had enjoyed it, thanks to the legislation included in Biden. infrastructure bill.
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Nimbus CEO Alex Lemberg believes that regulatory bodies will become "a little friendlier" and "better prepared" to start regulating space.
"Institutions have already found investment vehicles and structures to participate regardless of participation, but I think, from both the local state and federal government perspectives, that will continue to grow," Lemberg told FOX Business.
NFT CryptoArt display in the art gallery with people using smart phones and digital tablets. Image fully generated in 3D. The image on the walls is mine and it is also a 3D generated image. (Getty images / istock)
VanEck investment firm CEO Jan van Eck said Barron which sees Washington "paralyzed" on regulation, with no movement "in either direction."
And that will allow for retail adoption, which has long been the biggest limiting factor to the popularity of cryptocurrencies - both the biggest jump and drop in Bitcoin's value occurred around Elon Musk. broad statements about Tesla first accepting cryptocurrency payments for cars, then turning around and saying that his company would no longer accept cryptocurrencies due to its damaging effects on the environment.
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One of the most interesting ways that cryptocurrencies can see better adoption of cryptocurrencies as payment for income.
Using crypto as income is not as prohibitive as it sounds, as individual stakeholders can buy fractional shares of a coin. This mechanism is the way that Bitcoin managed to reach its maximum value of $ 67,582 on November 8, 2021, when it would otherwise limit its value closer to $ 4,000. Block.One founder Brock Pierce said Crypto potato He believes that Bitcoin will exceed $ 200,000 in 2022.
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Mayor of New York Eric Adams and the mayor of Miami Francis Suarez have requested at least some of their paychecks in the form of cryptocurrencies, as have athletes, including NFL players Odell Beckham Jr. Y Aaron Rodgers. Suarez even lobbied for Miami to create the city's first ever cryptocurrency, MiamiCoin.
"I think it will be another catalyst driving adoption," Lemberg argued. He also mentioned the Metaverse "play to win"mechanism as a significant indicator of future and innovative methods that will see companies integrate cryptocurrency.
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The adoption of proof of stake (POS) over proof of work (POW) can also help increase participation and improve acceptance of cryptocurrency in spaces that you have traditionally struggled to enter. The biggest benefit POS would provide would be to see cryptocurrency energy consumption significantly reduced as it would no longer require the incredible investment of time and machine to solve equations and earn a token on the blockchain.
The change could affect miners who obtained their stake through the proof of work, but Lemberg predicts that the energy benefits of the proof of stake will improve the public image of the cryptocurrency.
No aspect of the de-fi has seen greater adoption than NFTs, which are digital collectibles that can be traded and traded. The market exploded this year, reaching a volume of 23,000 million dollars. Everyone from Ozzy Osborne to the NBA announced NFT in an effort to cash in on the trend and make money from the rising tide of value.
Adidas released their "Into the Metaverse" NFTs and earned more than $ 22 million.
Van Eck believes that cryptocurrencies will also face a test as a store of value, as inflation remains a major concern. If currencies remain strong while traditional currencies continue to fluctuate, public adoption may increase.
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But that adoption likely won't come in the form of an ETF, and the SEC is likely to push for jurisdiction over any cash cryptocurrency market, defeating the goal of a de-fi economy.
"It's clear that the SEC wants jurisdiction over the cryptocurrency cash markets," Van Eck told Barron's. "They don't seem to approve a Bitcoin ETF unless a federal court forces them to."
