The cryptocurrency market has always been volatile. 2022 hasn’t been a great year for the sector either, as the value of almost all major cryptocurrencies has declined compared to last year’s figures.
Ethereum went above $3,800 as of January 2022, and Bitcoin was just about $48,000. The primary cause of the significant decline of both prominent coins is the Fed’s fight against inflation. Losses shouldn’t come as a surprise to anyone considering that this year has been plagued with crypto breakdowns, crashes, and upheaval. The question is whether the current state of the market instability will last in 2023 or not.
According to a survey by Fortune Business Insights, the North American cryptocurrency trends market is predicted to expand at a CAGR of 11.2% to hit $1,758.0 million by 2027. This increase is attributed to several factors, including increased funding and engagement in the US crypto market. There will be several innovations and improvements as 2023 approaches. Let’s look at what the coming year has in store for cryptocurrencies.
1. Stablecoins Will Become Prominent
These cryptocurrencies are made to have their market value tied to a reliable resource, such as fiat money or cryptocurrency. Stablecoins are expected to become more lucrative in 2023. Two factors may fuel the development of stablecoins.
The first is the unpredictability of decentralized tokens, and the second is the expected overthrow of Tether. Tether was one of the first stablecoins to join the cryptocurrency niche. But as the market expanded, it saw many rough patches. As a result, Tether’s supremacy may soon end with more stablecoins entering the market.
2. Improved Social Interaction in the Metaverse
More companies are expected to invest in the Metaverse next year. For example, RobotEra is creating a sandbox-like metaverse where players will become robots, managing their lands and participating in the creation of a new world. They will also be able to go to concerts, restaurants, and salons while interacting with other players in this socially active Metaverse. Without knowing any code, they can also develop their unique active collaborative experiences. This is a wonderful approach to motivate users to create enjoyable experiences they would like to have while getting compensated for it.
3. The Rise of Institutional Investors
The involvement of institutional investors will be among the largest trends in cryptocurrencies. Institutional investors are anticipated to move up the board in 2023, while individual investors are projected to keep increasing their transaction figures.
This is unusual because individual investors have always controlled the market. Trading volumes will dramatically increase due to the introduction of institutional investors. Therefore, even if there is little trading activity in the space of digital currencies, the sector will be able to survive.
4. Focus on Social Causes
Investors are shifting their investments to include more socially aware initiatives. The project IMPT, a platform for carbon credits, is the best illustration of this.
A decentralized network that IMPT is developing will allow users to acquire carbon credits using IMPT coins. Tokens can be acquired by participating in various ecosystem activities. The burner gets an NFT if such carbon credits are burned. The NFTs can be kept as a collectible or offered for sale on an NFT exchange like Rarible or OpenSea.
In 2023, the crypto market will experience a major shift as the themes above take center stage. The introduction of institutional investors will bring some stability to the crypto market while developments in the Metaverse will continue, expanding the scope of the technology.