2023 Crypto Assets Industry Review and 2024 Development Trend Outlook

In 2023, the total market capitalization of the Crypto Assets market returned to 1.7 trillion USD, with an annual growth rate exceeding 110%, marking that the industry has passed through the cycle's winter. Looking back at this year, several important events left a deep impression on industry insiders:

1. A large trading platform reached a settlement with US regulators, pushing the compliance of Crypto Assets companies to become a mainstream trend.

2. The Bitcoin ecosystem leads a new paradigm of fair issuance of inscriptions, which is mainly attributed to the technical feasibility brought by the Taproot upgrade.

3. Ethereum's LSD/LSDFi defines the industry's concept of "risk-free yield", with ETH staking rewards regarded as "Crypto Assets treasury yields".

4. Layer 2 networks are gradually taking over Ethereum ecosystem applications, with the current total locked value of Layer 2 networks reaching $2 billion, close to Ethereum's $2.9 billion.

5. A certain public chain has once again become a hot topic, and the DePIN and MEME projects within its ecosystem have regained market attention.

6. Real-world assets ( RWA ) earnings have become an important source of profit for decentralized finance lending protocols. For example, the most profitable DeFi protocol MakerDAO derives 58.1% of its revenue from RWA (mainly government bonds).

Looking ahead to 2024, industry experts predict the following ten major development trends:

1. After the approval of the Bitcoin spot ETF, it is expected to bring in over $30 billion in incremental funds.

2. The total market value of the Bitcoin ecosystem's inscriptions could exceed 20 billion USD, and truly fairly issued leading MEME projects are expected to gain medium to long-term consensus.

3. The Bitcoin Layer 2 network will usher in rapid development, benefiting the infrastructure for application-based ecosystems of Bitcoin.

4. The total locked value of Ethereum's Layer 2 networks is expected to surpass that of the Ethereum mainnet, possibly reaching over $100 billion.

5. Although the scale of zero-knowledge proof Rollups is still difficult to match that of optimistic Rollups, the zero-knowledge modular combinations in Ethereum's Layer 2 network components will tend to be complete.

6. A certain cross-chain project is expected to issue coins in the first half of the year, which is likely to boost market enthusiasm for the interoperability track.

7. The parallel EVM new narrative will drive secondary growth for certain public chains.

8. The market size of the decentralized physical infrastructure network ( DePIN ) may grow 10 times.

9. There may be explosive autonomous worlds or full-chain games with strong social attributes.

10. The integration of AI and Crypto Assets in multiple application scenarios will create star cases, such as using Bitcoin as an AI payment currency, and utilizing zero-knowledge machine learning (ZKML) for training sensitive data and model evaluation.

These trends reflect that the Crypto Assets industry is developing towards a more mature and diversified direction, while also facing challenges and opportunities in various aspects such as technological innovation, regulatory compliance, and market demand.