If global markets Continuing to face downward trends, crypto markets anticipate greater adoption as people view the digital asset sector as a hedge against inflation (although some prices are currently below their 52-week mark).
Whether it’s new cryptocurrency buyers or those learning more about NFTs, Bitcoin and the general crypto ecosystem, there is an upsurge in crypto awareness worldwide and, in turn, adoption, data shows.
About half of all crypto owners in the US, Latin America, Asia-Pacific, Brazil, Hong Kong and India first bought digital assets in 2021, marking a major breakthrough for the emerging industry, according to a Gemini report. Globally, 41% of those surveyed who did not own crypto said they were interested in learning more or buying it by 2022, the report said.
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At the end of 2021, the global crypto market had 295 million users, but that number could reach 1 billion by the end of 2022, based on last year’s growth rate, according to a report by Crypto.com. But given the current market volatility, with a total crypto market cap 46% lower than the year to date, it is uncertain whether that 1 billion mark will be reached within the next six months.
Mainstream adoption amid a decentralized ethos
As crypto becomes more mainstream, regulators around the world have been watching the space more closely to protect (they say) consumers. Just last week, The Group of Seven, an international political forum of members from the US, Canada, France, Germany, Italy, Japan and the UK, called for rapid, consistent and comprehensive regulation of crypto asset issuers and service providers.
But can crypto really remain decentralized while governments worldwide are at home in the industry?
Decentralization can mean different things to different people, but most in the web3 community agree that it’s one of the key factors in what makes crypto, well, cryptocurrencies† So as regulators step into the space and begin to set frameworks and guidelines, decentralization must remain prominent in the industry if it is to stick to the core principles on which it is based.
“Decentralization is at the heart of the web3 ethos, and it must remain at the core as crypto becomes more mainstream,” Wilson Wei, co-founder and CEO of CyberConnect, told Marketingwithanoy. “To ensure that decentralization remains central to crypto and web3 as a whole, it starts with the infrastructure.”
Decentralization comes down to ownership of data, Wei said. The problem with Web 2.0 is that a handful of tech giants like Facebook and Instagram own most of the user data, but in web3, data shouldn’t be owned by the platform, he argued: “To stay decentralized, we need to make sure that applications are actually build services on top of decentralized infrastructures, guaranteeing the sovereignty of user data.”
This is more of a parallel and complementary evolution, Jonathan Schemoul, co-founder and CEO of Aleph.im told Marketingwithanoy. “There are already decentralized cryptocurrencies and applications that people use and support for the advantages they offer over centralized options, and will continue to be.”
For example, Aave is a decentralized lending protocol that allows users to take out collateral-backed loans without authorization without the need for personal information or KYC/AML (know your customer/anti-money laundering) documentation, Schemoul noted. But centralized crypto platforms like BlockFi, on the other hand, also enable crypto-collateral lending and operate in a way that is permissive, more intrusive and less transparent than decentralized alternatives, he added.
A world that merges with Web 2.0 and web3
In some ways, crypto will remain decentralized, while in others it will lean towards centralization, Schemoul said. “That’s fine; web3 is not going to replace Web 2.0.”
“The ethos isn’t just decentralization for the sake of decentralization,” said Kurt Hemecker, COO of Mina Foundation and former chief of operations at Meta’s Diem Association. “On the contrary, the underlying decentralized design is what makes cryptocurrency revolutionary.”