Cryptoverse went through many ups and downs in 2021. Numerous innovations, developments, and technology had come in place, some of them were proven a boon for decentralized finance, and some were shut off with initial rollout. In Crypto 2021, many fascinating and revolutionary projects have helped crypto to grow its market cap.
There is a famous quote that if you want to know somebody, look back into their past. The quote is extremely suitable for cryptoverse also. To envisage crypto 2022, you must take a dive into Crypto 2021. Initiatives that were started in the last year will certainly influence crypto this year. So, let’s take a look over the top 15 moments of cryptoverse to know what story we shall see in 2022.
1. Bitcoin Taproot Upgrade
In November 2021, the world’s largest blockchain Bitcoin created history after revealing the Taproot upgrade after a 4-year long span. This upgrade enhances blockchain efficiency through batches of multiple signatures and transactions. This will help the blockchain to verify transactions rapidly. In the upcoming months, the transactions on Bitcoin are expected to scale up due to this fascinating up-gradation.
2. Ethereum 2.0 Upgrade
Ethereum 2.0, the most-awaited and promising project in blockchain history. The developers have decided to roll out its upgrade into three-phase. The first phase was already launched in Dec 2020, which was the induction of the proof-of-stake mechanism through the Beacon chain.
In 2021, Ethereum initiated the preparation of phase 2 by launching the Kintsugi testnet. In the second phase, the Ethereum mainnet will merge with the beacon chain, hence it will replace the proof-of-work mechanism with proof-of-stake.
This upgrade will make Ethereum 2.0 more energy-efficient and hence transaction costs will also reduce. The merger was expected to launch in 2021, but due to delay now it is expected in the first half of 2022.
The third and last phase, sharding, is planned for 2023. The final phase will make the Ethereum blockchain capable of executing multiple transactions at the same time.
3. Cardano Hard Fork Update & Polkadot Parachain Auction
The world’s third-largest blockchain, Cardano doesn’t want to be left out in the jump of the cryptoverse. That’s why developers are continuously putting efforts to enhance blockchain performance.
Last year, Cardano received the smart contract capability in face of Alonzo hard fork update. It will continue to implement upgrades to improve the blockchain experience. Its upcoming upgrades include Goguen, Basho, and Voltaire.
Polkadot and Kusma network came out with different kinds of auctions for its parachains in 2021. As per the auction details, the Parachain auction allows defi projects to reserve slots out of 100 parachains slots through the highest Bid.
In the first year of auction, 20-30 parachain will be given on leases. Last year, the first five slots were reserved by Acala, Moonbeam, Astar, Parallel, and Clover respectively.
4. Increasing Layer-2 Scaling Solutions’ Integration
In the last few years, the DeFi graph soared exponentially and 2021 is not exceptional for this. The spontaneous boom in DeFi activities and projects has helped DeFi to embark on new milestones. In 2021, the total value locked (TVL) in Defi had surpassed $110 billion bar. However, it ended the year with $86 billion TVL.
With the expansion of DeFi activities, the protocols have started integrations with layer-2 scaling solutions to make the transactions faster and cheaper. Some leading scaling solutions are Arbitrum, Polygon, Optimism, Parastate, and Cartesi.
For example, last year, the third-largest lending and borrowing protocol, Aave, announced its integration with Ethereum layer 2 scaling solution, Polygon. Uniswap was also integrated with Optimism in July 2021.
5. Regulations and CBDC Projects
Many Countries are still sceptical about cryptocurrencies and resisting their expansion. In 2021 some major countries had taken moves to regulate and control crypto. While some have welcomed crypto with open hands.
Crypto Regulations in Major Economies
The world’s major economies have taken steps to make crypto compliant with regulations.
- United Nations
The UN is concerned about crypto mining activity and called it a ‘pointless way of using energy as it requires a huge amount of energy to compute. According to the UN, While the world is searching for more energy-efficient options for every aspect of life, adopting crypto technology with a proof-of-work (Pow) mechanism could harm the zero carbon emission goal by 2030. However, the UN has appreciated the alternate option, proof-of-stake (Pos).
- United States
Last year, U.S regulatory authorities passed the most controversial ‘Infrastructure bill’ under the presidency of Joe Biden. The bill contains provisions to impose a tax on cryptocurrency trading and yield. Many crypto intellectuals and entrepreneurs have opposed this bill as it degrades decentralized finance.
- China
On the other hand, when crypto was ballooning in China, the country announced a crackdown and resisted crypto expansion in the country. After announcing a partial ban on Crypto activity in the country, In September, China had announced a blanket ban on all crypto trading and mining activity. Owing to this, many crypto firms and mining pools have started to relocate their operations out of the country.
- India
In 2021, the Indian government seems in a state of confusion. Regulatory officials had appeared to flaunt a possible ban through a cryptocurrency bill in the winter session. But at the end of the winter session, there was no sign of cryptocurrency bills in the country.
While these major economies were hunting down the emerging crypto, Some developing nations have decided to embrace crypto after considering its future economic benefits. While shifting over cryptocurrency, these countries have rolled out their own Central Bank Digital Currencies.
CBDC roll out in growing Economy
In March 2021, Eastern Caribbean had become the first monetary union in the world to launch a Central Bank Digital Currency after launching a digital version of the Eastern Caribbean dollar. After that Nigeria has also rolled out e-naira, a countrywide digital currency.
Meanwhile, Many country’s CBDC projects are in the pilot phase and planning to roll out in the near future. Countries like Japan and China have already started pilot testing for their CBDC projects. The development of China’s digital Yuan project is in the advanced phase.
6. Crypto Adoption
In 2021, Crypto adoption increased in a surprising manner as many countries have welcomed prominent cryptocurrencies in different ways. Some have grown their crypto stake by acquisition, while others have granted permission to launch exceptional crypto services.
El Salvador Bitcoin stake
Last year, El Salvador became the first country to announce Bitcoin as a legal tender. The young crypto enthusiastic president of the country, Nayib Bukele has acquired 400 Bitcoins for the first time in September. After that, the country is continuously growing its Bitcoin stake through buying the dip. At the time of writing, El Salvador is holding up 1291 Bitcoin.
Microstrategy
Microstrategy has continued its speed to grow its Bitcoin stake after buying 21,000 Bitcoins in 2020. In an entire year, Microstrategy has acquired more than 100,000 Bitcoin through different ‘dip-buying’. At the time of writing, the company has the largest bitcoin holding with 124,391 Bitcoins.
Exchange-Traded Fund (ETF)
U.S Security and Exchange Commission has finally approved the first ETF filed by Proshares. After getting approval from the authority, ProShares officially launched its first Bitcoin-linked ETF on 18th October under the ticker of “BITO”, which has gained a $1 billion volume in just a day.
Increased popularity of Meme coins
Last year, U.S’ leading Entertainment and theatre company, AMC began to accept prominent cryptocurrencies and meme coins as an online payment method. After the starting Bitcoin and Ether payments for movie tickets, AMC has added meme coins such as Dogecoin and SHIB in October.
In March, the Cuban basketball team, Dallas Mavericks became the first team in NBA history to accept dogecoin for tickets and merchandise. Moreover, U.S-based e-retailer company, Newegg has also adopted dogecoin and SHIB for online shopping after observing a surge in dogecoin valuation.
Sportspeople accepted Salary in Cryptocurrency
You won’t believe this, but some famous faces of sports have already started to take their remuneration in cryptocurrency. In this list, Atomic Flea of Football, Messi has taken his salary in his club’s fan tokens, $PSG. The list also contains big names who had chosen crypto over cash including Tom Brady, Aaron Rodgers, Odell Beckham Jr., Trevor Lawrence, Saquon Barkley, and many others.
7. Business Tycoons and Tech giants in Crypto
Elon Musk’s Melodrama for Crypto
Last year Elon Musk seemed to like playing puzzle games with different crypto and moves were so baffling. After starting Bitcoin payment for Tesla in March, Elon Musk has dramatically cancelled it by stating energy concerns for Bitcoin mining.
In complete opposition to this move, Elon Musk has started to promote dogecoin and declared in a tweet that Tesla will accept dogecoin for merchandise on a test basis. After this tweet, dogecoin skyrocketed by 24%. SpaceX, which is also owned by Elon Musk had announced a dogecoin fund for its upcoming moon mission. Many intellectuals have criticized Musk for this biassed crypto move in 2021.
Moreover, Musk has also boosted another meme coin, SHIB. The SHIB coin’s price soared suddenly when Elon Musk posted a photograph of the Shiba Inu meme going to the Moon on October 18. The post took SHIB from $0.000026 to $0.000044 with a 50% hike.
Jack Dorsey’s Crypto Interest
Do you know what is the reason behind the resignation of Twitter CEO, Jack Dorsey? His crypto interest! Yes, World’s leading social media platform’s CEO wants to indulge himself in revolutionary crypto technology and that’s why he said goodbye to Twitter in 2021.
After running almost 16 years on Twitter, last year, Jack Dorsey decided to move on from the company. Jack Dorsey overwhelmingly works on future crypto projects.
Jack Dorsey’s payment service company Square was renamed Block and has recently announced the development of a bitcoin mining system, which will be open source for individuals and businesses worldwide. Also, the company has also published a white paper with a plan to build a decentralized bitcoin exchange with the title tbDEX.
Facebook’s Crypto Failure in 2021
At the beginning of fiscal 2021, Facebook had launched its own private currency, Diem with the aim of universal currency. Diem is pegged with USD and holds a 1:1 ratio.
After the successful induction of Diem, the social media giant wanted to establish its own crypto wallet, Novi for Diem’s expansion and make it a universal currency for users. But just a few hours after the launch of pilot testing of Novi, the U.S government had put an end to crypto wallet services.
8. Payments Giant Embraced Crypto
By following the crypto trend, many reputed and leading payment companies are locking up deals with crypto firms to facilitate crypto-based services.
PayPal collaboration with Coinbase
The world’s largest payment service provider, Paypal has observed interest in its user base and formed a partnership with Coinbase. With this partnership, Coinbase’s U.S based users now can buy listed cryptocurrency through a Paypal account in a secured manner.
Paypal’s Trading Service in the U.K
After the U.S initiative, PayPal has made a foray into the U.K trading market. In August 2021 PayPal began trading services on its platform without any fees. The company offers trading services only for four leading currencies, Bitcoin, Ether, Litecoin, and Bitcoin Cash.
Mastercard
In 2021, After watching the potential growth of crypto, Mastercard has planned to launch a cryptocard through collaboration with three leading crypto firms in the Asia Pacific region. Using these cryptocards, one will be able to convert cryptocurrency into fiat currency.
9. DAOs
DAOs (Decentralized Autonomous Organisations) are another most versatile concept in decentralized finance. In 2021, some DAOs formed to achieve certain goals by the contribution of members.
Constitution DAO was formed to place a bid to acquire a rare copy of the U.S constitution. To achieve that goal, members of DAO have raised $47 million. But surprisingly, during the auction, the Constitution DAO’s members have limited their bid for $41 million, while the competitor, Ken Griffin has outbid Constitution DAO and won that rare physical copy of the Constitution.
Another DAO, which was in many news headlines, is FreeRoss DAO. The name of this DAO is controversial as it is inspired by Ross Ulbricht, the first black market creator on the internet and currently in the custody of the U.S government. Last year as a part of the FreeRoss moment, ‘The Ross Ulbricht Genesis’ non-fungible token (NFT) collection’s auction was organized. FreeRossDAO’s members have raised 2,800 ETH collectively and won NFTs collection through placing a bid at 1,446 ETH.
10. Cyberattacks
In 2021, nearly 70 DeFi attacks were executed and nearly $14 billion worth of digital assets were stolen, which is almost 79% more than 2020.
In August, Polynetwork suffered the largest cyberattack in DeFi’s history, in which hackers compromised the network and transferred $600 million worth of different tokens to his address. Latterly, the hacker has returned all stolen funds to Polynetwork.
Another major cyberattack was reported on the Bitmart crypto exchange in 2021, where crypto has compromised private keys and stolen $196 million worth of cryptocurrency.
These cyberattacks certainly created fear among crypto investors and entrepreneurs, but they will not be able to resist the pace and expansion of cryptoverse. The developer community is working consistently to resolve issues and prevent incidents. In 2022, numerous developments are going to take place, which can be a game-changer for cryptoverse.
