Bankless: Review of 2022 Predictions and Trend Forecasts for 2023

Written by: Bankless

Compiled by: The Way of DeFi

2022 was full of surprises, wasn't it? At least I didn't expect…

• A ++top three exchange++ committing one of the worst frauds in history.

• ++The largest cryptocurrency fund++ being a massive over-leveraged scam.

• One of the largest blockchains going to zero and ++being wanted by Interpol++.

But should we be surprised?

While the specific details are always unpredictable, the madness of 2022 was exactly what Bankless predicted when we put trust in people instead of code.

We don't know which crypto bank will fail us… we just know they will fail.

So we must keep our keys safe.

We don't know which trader on Twitter is just an over-leveraged gambler.

So what we need to do is invest theoretically, not ++chase their narratives++.

We don't know which blockchain technology will change the world next.

But we know it will be those that prioritize ++decentralized technology++.

Protocols, not people.

Code, not kings.

We will double down on Bankless's core arguments in 2023. We won't get every detail right. That's impossible. But we have the right direction. As always, westward.

We're going bankless.

In the new year, it's time to make some great predictions. We were wrong about many things last year… but seriously, who could have predicted the collapse of FTX?

The good news is, this doesn't stop us from making bolder predictions for the new year. In hindsight, predictions can serve as a useful metric for measuring our depth in the echo chamber or how misled we are by market sentiment.

"What were you thinking?" is a valuable question we don't ask ourselves enough.

So, how did we do on some of our ++overall predictions++ entering 2022?

• ❌ New all-time high for cryptocurrency market cap.

• ✅ Eth2 merge occurred.

• ❌ Total market cap reaching $5 trillion (the peak was still $3 trillion).

• ✅ Bitcoin adopted by another nation-state (++CAR adopted in June++).

• ❌ Ethereum becoming a trillion-dollar network. (Currently only at $0.56 trillion)

• ❌ L2 reaching $25 billion in TVL. (Only reached $7 billion)

• ✅ NFT sales reaching $30 billion. (Surpassed $30 billion before April -- counting wash trading?)

• ❌ A DeFi protocol reaching the top 10 by market cap.

• ➖ DAOs making an eight-figure purchase for a real-world project. ++(UkraineDAO?++)

• ✅ Michael Saylor buying more Bitcoin. (He bought 5,610 BTC)

Overall Grade: C

Now, let's take a look at the team's predictions, starting with Ryan, David, and William.

Ryan Sean Adams: Founder

Grading Ryan's 2022 Predictions:

• ❌ Crypto market cap exceeding $7 trillion. (The peak was still $3 trillion)

• ❌ ETH to $10,000. (Only reached $4,500)

• ✅ L2 market cap entering the top 10. (Reached 10th place including Polygon)

• ❌ Bridging billions in assets. (Across, Hop issued tokens but still in the millions)

• ✅ BTC to $100,000. (Only reached $63,000)

• ➖ Web3 socialization. (Farcaster, Lens, Deso… still in early stages)

• ➖ DeFi returning. (DeFi didn't return… but it served us when CeFi failed!)

• ❌ Crypto banks going public. (They didn't)

• ✅ DAOs becoming more quirky. (The $8 million raised for the Ukraine war also counts as quirky)

• ✅ NFT expansion. (NFTs did expand… but only BAYC)

• ❌ GameFi establishing a niche. (Last year wasn't even a niche… still too early)

Overall Grade: C-

Perspective: I expected this bull market cycle to have 50% more upside. By last April, the Fed's tightening shortened the bull market's duration, but looking back, I'm glad -- we needed a detox!

RSA's 2023 Predictions:

• 2023 will have many ups and downs, but the crypto market cap will ultimately be above ++2 trillion dollars++.

• ETH withdrawals enabled in Q2 2023, Proto-Danksharding enabled in 2023.

• ETH dropping to three digits, giving us one last buying opportunity.

• Ethereum outperforming Bitcoin, but 2023 is not a year for a turnaround.

• A cryptocurrency law passing in Congress, but it's not the end of the world.

• L2's TVL reaching $25 billion (yes, the same as last year).

• DeFi rebuilding, returning to $125 billion in TVL.

• The strongest developer communities still exist: in order, Ethereum, Cosmos, Solana.

David Hoffman: Founder

Grading David's 2022 Predictions:

• ❌ The bear market will never come.

• ✅ Crypto newcomers are less concerned about centralization worries. (But it will be the complete opposite in 2023!)

• ✅ The merge occurred.

• ❌ ETH competitors trying to fix the monetary supply schedule. (Competitors still have delusions about oversupply of block space and the resulting token issuance schedule)

• ➖ Solid fee markets emerging on ETH competitors. (They did emerge, but then went back to 0)

• ✅ Optimism & Arbitrum thriving. (These two L2s were among the few growth areas in Crypto last year)

• ❌ EVM equivalents pushing Optimism to dominance. (Not in 2022, but this outlook looks good!)

• ✅ NFT flipping losing momentum. (Retail money ran out = everyone's profits decreased)

• ❌ RAI being adopted. (RAI certainly gained intellectual adoption; but did not translate into real adoption)

• ✅ BAYC surpassing Punks.

• ➖ 'Web3' becoming a household term. (Yes, but not in the way I wanted…)

• ✅ The speed of the 'bankless' meme accelerating. (Thanks FTX!)

• ✅ Politicians starting to advocate for Web3.

• ✅ Bankless continuously outputting. (We are very proud of our coverage of the FTX incident, and Bankless has a lot in the works for Q1 and Q2 of 2023).

Overall Grade: B

David's 2023 Predictions:

• Throughout 2023, Ethereum L2 will continue to see steady growth and adoption - Ethereum's scaling factor will ++grow from 2x to 5x++.

• At least one universal zkEVM will be open to users.

• The StarkNet ecosystem will maintain its lead over other zkEVMs.

• The performance of Ethereum DeFi blue chips will surpass that of Alt-L1 tokens. L2 tokens will do the same.

• ++DAOs++ will still struggle. Most DAOs will continue to operate at a loss, with only a few focusing on their PNL.

• There will always be a place for a bull market! I think this time it will be with Ethereum's signings. We will see more websites with 'SIWE' power.

• Bitcoin Maxis will continue to go crazy, out of touch with reality. Cory Klippsten will lead this effort.

• Richard Heart will find a new scam to promote after Pulsechain fades.

• The NFT collecting community will follow ++Balaji's network state++ theory. Those who survive the bear market will inject real utility into their assets.

• A dual assault from the CFTC and SEC will push cryptocurrency into its only safe haven: decentralized intangibility.

William M. Peaster

Grading William's 2022 Predictions:

• ❌ Ethereum DeFi's TVL will x2.

• ❌ Ethereum L2's TVL will reach $100 billion.

• ✅ A top 50 DeFi project will go bankrupt.

• ➖ US politicians will continue to be enthusiastic about Web3.

• ❌ All-time NFT sales will reach +$50 billion.

• ❌ Cool Cats becoming a top 3 NFT brand.

Overall Grade: F

WMP's 2023 NFT Predictions:

• As alt-L1s wobble, Ethereum's market share in NFT trading volume will again reach the 80% threshold.

• Polygon's NFT sales will surpass the historical sales of alt-L1s like Cardano, Flow, and Solana.

• As other market aggregators continue to gain traction, OpenSea's market share in the NFT market will sink below 50%.

• Yuga Labs' collections (BAYC, MAYC, BAKC, Otherdeeds, and CryptoPunks) will reach $10 billion in historical trading volume.

• Yuga Labs' showdown with the SEC will have some fireworks.

• Sorare will surpass Flow-based NBA Top Shot in sales events.

• The NFT-based identity ecosystem (ENS, POAP, SBTs) will see its next wave of significant activity.

• NFT use cases will increasingly drive activity in L2.

• The NFT gaming sector will launch its next breakout project (like Axie in 2020-2021).

• A major project will lose control of its NFT collection due to a hack.

Predictions from Other Members of the Bankless Team

The complexity of the team's predictions shows our excitement, interests, and blind spots.

Dawson Botsford: CTO

• Gemini Earn will return 100% of all frozen funds. I have a lot of assets stuck here, so I'm optimistic about this issue.

• Brian Armstrong will become more famous. After a year filled with rug pulls, Crypto needs good actors to serve as idols. Brian will be ready to be a knight.

• Sui, Aptos, or similar companies will gain traction and then break through in scale.

• Ethereum will open physical stores (like Solana). I hated this idea before, but now I feel some people need a real experience to understand crypto.

• CryptoPunks will soar.

• Bankless Labs will create two more products defining web3 -- Earnifi has brought in over $150 million through airdrop notifications. We are currently expanding more technology for your Bankless journey.

Rachel Cusack: COO

• Ethereum will flip Bitcoin.

Lucas Matney: Head of Editorial

• The situation at Twitter will worsen, with Elon distancing himself from the most ardent defenders of crypto, and crypto Twitter will still not turn to decentralized social.

• Reddit will quietly become a major crypto player.

• The SEC will directly target some crypto venture capital firms.

• Elizabeth Warren will give up being the Senate's active advocate for regulating cryptocurrency, realizing that hating DeFi isn't the kind of progressive appeal she thought it was.

• A non-Kardashian celebrity will be fined over $1 million for promoting a project.

• Apple will continue its war on crypto while quietly building a team to explore monetization in the app store.

Lucas Campbell: Head of Web3

• ENS will crush it on fundamentals (registered domains, revenue, etc.).

• ++Liquid staking++ will outperform the market.

• Against the backdrop of new artists and collectors entering the space, ++music NFTs++ will continue to gain traction. Music is collectible.

• Web3 social will lay the groundwork for a bull market (similar to DeFi in 2019). Identity, social graphs, ++collectible content++ are all key parts of this new internet social layer.

• TCR summer. ++Token Curated Registries++, a crypto-native concept hypothesized in Ethereum's early days, will finally start to see some adoption (due to the wave of web3 social).

Donovan Choy: Editor

• The rollout of CBDCs. They won't get far unless governments mandatorily tie them to basic payment services (like taxes).

• StarkNet will underperform relative to its L2 competitors.

• Technically, Ethereum's censorship issues are a thing of the past. Another black swan event like the Tornado Cash sanctions could stir up significant unrest, but there won't be any existing censorship issues like in 2022.

• BTC will not break $28.7K in 2023.

• Individuals will lose more money in cryptocurrency.

Ben Giove: Analyst

• After the Shanghai upgrade, liquid staking in the DeFi space will see massive growth. Lido remains the market leader but will lose significant market share to challengers like Rocket Pool, StakeWise, and Frax. RPL will match LDO's market cap. All LSD pure plays (LDO, RPL, SWISE) will outperform ETH this year.

• The total TVL of Ethereum L2s will exceed $10 billion, driving a revival in DeFi. Arbitrum will become the second-largest L1/L2 by TVL after launching their token, with GMX becoming a unicorn.

• A major L1 will announce they will become an Ethereum L2.

• We will see November 9, 2022, as the bottom of the crypto market, and this year will end with a rise. ETH will not see three digits again, reaching $3,000 at some point in 2023 before pulling back.

Jack Inabinet: Analyst

• The deadlocked Congress will make little significant progress on cryptocurrency regulation or legal clarity.

• Driven by GLP yields, Arbitrum's asset management protocols will gain widespread adoption.

• SBF will be convicted.

Dave Freiburger: Content Operations

• 50% of Fortune 500 companies will enable "crypto payments," and 15% of companies will add wallet connections to their websites or engage in cryptocurrency/web3 through partnerships, dedicated features, or NFTs.

• Twitter will become more involved in web3. As Twitter seeks more ways to monetize, it will roll out more web3 products/features, with other web2 companies following suit. However, Farcaster will lead as the premier web3 social application, distancing itself from these products.

• Moonbirds DAO will essentially reach or come close to the success level of Nouns DAO.

Kristi Klaudy: Community Manager

• Further consolidation of Bitcoin miners and a tighter oligopoly market.

• Discussions within the Bitcoin community will thrive around long-term improvements to Bitcoin security. I truly believe this will become a topic in 2023/2024 (depending on market conditions).

That concludes the Bankless team's predictions for 2023.

Remember… this is not financial advice.