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Messari: Explore which crypto trends may spark the next bull run

Messari

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Assess three major trends to see if they really have the power to catalyze the acceleration of the next bull market.

Original title: " Messari: Three Crypto Trends and Challenges for the Next Bull Run "

Original source: Messari

Original compilation: PANews

The next bull market will be driven by technologies and trends that are still building in the current bear market, but not all technologies or trends are equally valuable. So, let’s explore which crypto trends could inspire the next bull run in this article.

In fact, we can use a framework to evaluate encryption trends. The main factors considered by the framework include:

1. Innovation

2, 10x value potential

3. Total Addressable Market (TAM)

4. Value Capture

5. Competitiveness

With this framework in mind, we might be able to evaluate the following three trends to see if they actually have the power to catalyze the acceleration of the next bull market.

1. Application Agreement

In the past, the encryption industry seemed to place more emphasis on network protocols than application protocols. But now, the dynamics of market competition have undergone subtle changes. The new ecosystem will go to great lengths to achieve EVM compatibility so that application protocols can be easily deployed.

As blockchain competition becomes more and more fierce, execution environments such as EVM begin to explore commercialization and profit models. In this case, encryption applications have gained a more stable industry positioning. Not only that, the encryption application itself is looking for a more optimized business model, aiming to accumulate more "bottom line revenue".

Application Protocol Development Trends

1. Core Features

Portability: APP can now easily adapt to the new (EVM) blockchain;

Profitability: Using the stablecoin model, the application protocol can generate "bottom line income";

User relationships: Application protocols can generate better user relationships than traditional network protocols.

2. Key differences

Sustainability: the application protocol will benefit from the competition of the basic chain;

Unforkable: The minted stable currency liquidity will not face the risk of fork;

Verifiability: The product and team are battle-tested.

3. Main challenges

Incentives: need to provide ETH incentives, or provide excess incentives;

Regulation: need to face the risk of regulatory uncertainty;

Favorable factors

1. Ecological Fund

The ecological fund will attract more users to the APP;

APP will accrue revenue and brand power;

Leverage brand power to expand more blockchains.

2. Business optimization

Product upgrades will increase revenue;

The source code license will reduce the risk of forking;

Enhancing Governance Process

Disadvantages

1. Supervision

Compliance requirements from US regulators will limit user base growth;

Expect additional regulation of stablecoins;

2. Encrypted User Experience

Users have negative perceptions of crypto wallets and browsers;

Lack of accessibility limits user base development;

User experience is beyond protocol control.

Second, decentralized social interaction

Decentralized social networking provides people with chain reputation, organization (DAO) and content ownership, among which content ownership is the key, because it provides a way for people to finally obtain the value they create, which means that the Internet will re- Build value streams.

Decentralized social networking is a completely open, personalized and "possessible" social media. Social APPs can create independent profit models, and users can also earn income through the content they create. Products include data hosts, social graphs and social applications.

Decentralized Social Development Trend

1. Core functions

Income: There are various profit models, such as P2E;

Open data: social graph data can be migrated between applications;

Scalability: Decentralized social is open source and fully customizable.

2. Key differences

Large addressable market: includes social network advertising and digital commerce;

Defensibility: social graphs and infrastructure can be completed quickly and effectively consolidated;

"Portable Capabilities": Developers and users experience more convenient access.

3. Main challenges

Scalability: The scale of daily active users of decentralized social applications is generally high, which will put a certain pressure on the blockchain;

Privacy: The data of decentralized social applications is open, and due to the lack of privacy, some users may feel unhappy;

User experience: In terms of wallet experience, ordinary users may be slightly poor.

Favorable factors

1. The user "owns" the content

Through NFT, users hope to own and share content;

User-owned content will enable more functional design;

When users have mastered the content ownership, user stickiness will be further improved.

2. Social Investment

Investment activities will become more social, such as WSB and DAO;

Lack of a native social investment platform in the past, it may have great potential for development in the future;

Investing parties need to establish credibility in the community, and there will be a number of native tools that provide investment credibility.

Disadvantages

1. Mobile encryption will be restricted

Encryption integration on the mobile side is not efficient;

iOS has always been a "firm gatekeeper";

Greatly limits the available user base.

2. Data problem

Social application products usually generate massive data;

The current blockchain is difficult to handle massive transaction data;

Availability layer required to support unpublished data.

3. Web3 games

The goal of Web3 games is to allow players to own the ownership of their digital items in the game, and use Token to create an in-game economy, and then promote players participating in the game to gain a sense of accomplishment in the game and become attached to this feeling, and are more willing to Invest money in the game.

Driven by the "play while earning" game model like Axie Infinity, Web3 games are becoming more and more popular, and more and more Web3 games have begun to integrate Token into their own mechanisms. While there hasn’t been a sustainable Web3 game so far, the space has attracted significant investment aimed at developing the next “big game.”