- BitMEX exchange has shared its top 3 predictions for the crypto industry in 2023.
- With the current macroeconomic outlook, emphasis remains on betting on projects with real use cases.
The digital currency ecosystem remains a major industry whose emergence and survival have continued to baffle regulators around the world. Over the years, the nascent industry has recorded quite a number of advances and trends that have largely kept it on the radar as the next mega-tech innovation of the 21st century.
Over the past few years, we have seen the growth of Decentralized Finance (DeFi), Non-Fungible Tokens (NFT), and even the metaverse, all of which denotes a high level of innovation or the other. While the industry has continued to nurture the innovations surrounding this technology, the current trend in the global economy which has trickled down to the crypto ecosystem has triggered a whole new perception for the industry.
As a major contributor to the industry, the BitMEX crypto trading platform has shared three major predictions for the digital currency ecosystem that we should watch out for in 2023. Here’s a short insight into each of these predictions.
#1, the Recovery of Risk Assets
Risk assets like Bitcoin (BTC) are often kept in a speculative range when the global economy is experiencing and undergoing some form of meltdown as we have seen since the advent of the coronavirus pandemic.
According to BitMEX’s hypothesis, risk assets have a very high likelihood of recovering this year as inflation is likely to ease and the hawkish approach of Central Banks around the world eases. Should the projection on inflation come through and a dovish stance to monetary tightening is adopted, there will be more cash flow into the economy which will generally encourage the embrace of Bitcoin and other crypto assets.
While the industry can expect funds to flow into the economy, BitMEX shared a reminder that the ecosystem has not forgotten the lessons learned from the collapse of mega Web3.0 giants such as FTX Derivatives Exchange and Genesis Global amongst others. The exchange is optimistic that better decisions will be made this time around.
#2 Maintaining the Status Quo with Caution Continuing
BitMEX also shared insights into the possibilities of a trend in which the drivers of the economy choose to maintain the status quo and continue hiking interest rates. While the trading platform said in its report that it believes the probability to do this is low, it noted that there are external events that may help keep inflation high.
In this instance, the exchange is advocating that investors embrace crypto projects with novel use cases. Since investment must be made, then it is better to do it with such projects like VeChain (VET), and Cardano (ADA) with proven innovation that spreads beyond Web3.0 to the mainstream ecosystem.
#3, Safer Asset Class
BitMEX is also projecting a likely scenario that will see a broad embrace of Bitcoin as a safer asset class in more than one jurisdiction. With the business model already being propounded by firms like MicroStrategy Incorporated which has a sizeable holding in the cryptocurrency, more may join along the line.
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We expect regulators will continue to embrace the technology and the advantages that it brings in 2023, with discussions occurring at the most senior levels within governments, and crypto receiving more attention from policy makers than at any other time previously. said Julian Tehan, Chief Compliance Officer at BitMEX.
This regulatory embrace is bound to drive the adoption in the mid to long term.
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