A Few Predictions on The Next Fews Years of Crypto

by Walt Smith
on

The views represented here are solely those of the author and not representative of a holistic view from the Standard Crypto partnership.

Some views are strongly held, some weakly held (are we wrong on some of these? Of course). The 10-year timeline holds generally for all, but a few will undoubtedly take much longer. 

The order below has been randomized with an LLM.

  1. App tokens will create and sustain the first ever successful crypto game.
  2. In conjunction with pro-dollar regulation, a sitting U.S. president will push chokepoint rules on Bitcoin (and other scarce crypto assets). Much like FDR’s gold acts in the 1930s, regulation will begin with bans on private custody and shift direct exchange of Bitcoin to a loose dollar peg at Fed-approved banks; eventually, large exchanges will be outlawed. Core developers will roll out privacy solutions, and Bitcoin-secured networks will enable FX, commodities, and tokenized equity trading, blunting the rules’ effect.
  3. A DeFi blue chip will experience a $10B+ hack, causing a massive international crisis.
  4. Inflation-adjusted, no memecoin will ever top Dogecoin’s 2021 FDV, but in nominal terms a new memecoin king will be born, breaking $100B+ in market cap.
  5. Charter colleges will replace charter cities as a favored means for ideological investors to create broader societal change. Issues of school independence will again reach the Supreme Court. Attending a private enterprise institution will become a status signal, much like college was in America prior to the GI Bill. Given the skin-in-the-game and reliance on private enterprise inherent to these institutions, most will be vehemently pro-Bitcoin and pro-Tech.
  6. Coinbase will become a Fed member bank. The U.S. government will buy Bitcoin and sanction certain nations from using it. The U.S. will eventually sell down gold reserves to buy more Bitcoin.
  7. One major crypto exchange will move the majority of its stack on-chain.
  8. Google ad auctions will take place inside a TEE, leading to a significant reduction in Google’s revenue.
  9. The rise of a U.S.-based chip fab will make open-source Bitcoin miner firmware commonplace and help proliferate alternative mining rigs. Within two halvings, a high single-digit percent of Bitcoin’s hashrate will be powered by residential and commercial HVAC systems, mostly in the Western Rockies. By 2036, nearly 30% of the network will be powered this way. Most Bitcoin miners will have shifted into HPC data centers, powered by nuclear, while home ASICs lean on solar. Environmental groups will resist both but gain little traction as society favors amortizing heating costs with Bitcoin mining.
  10. Breakthroughs in FHE and other encryption schemes will create viable self-sovereign identity, data, healthcare, and social platforms. Without advertising, these products will not reach massive growth or lobby effectively against centralized incumbents; they will only find PMF with ideological users.
  11. Solana and Flashbots will solve decentralized, collaborative block-building at roughly the same time but with different designs. Both will design microstructure that makes spot and perp market-making sustainable. Each will compete to be the global order book for tokenized assets. Solana will continue to embrace major network redesigns on behalf of its applications, while Ethereum will resist those same users.
  12. Local stablecoins — despite not being a better form of money — will take off as governments enact blockchain-based capital controls to choke unfettered access to U.S. dollar, ensuring the inflation they need to stay fiscally sound. The U.S. will respond with wars, sanctions, and regulation to reinforce dollar supremacy via stablecoins.
  13. Bitcoin will have trustless L2s and private cash. All major networks will need to rethink designs to compete with programmatic Bitcoin.
  14. TEEs will continue to grow in popularity, enabling new blockchain-adjacent apps. The commercial and political viability of open-source, auditable TEEs will remain dubious, but crypto fanatics will continue to yearn for them.
  15. Open timestamps will enable the creation and popularization of verifiable news. After proving themselves in elections, AI/image verification, and a few major publications, Wikipedia will resist then adopt blockchain-based timestamping. In the interim, a hash-based alternative (“Hashpedia”) will replace it as the favored source for LLMs.
  16. Out of the CBOE, Nasdaq, TXIC, NYSE, or CME, one will offer a BTC-denominated spot market against its core products. The spot volumes for some assets will surpass dollar-denominated volumes.
  17. A former CEO of a crypto unicorn will successfully run for office as a U.S. senator or vice president.
  18. A non-venture funded network state will take off, uniting dogmatic citizens with staunch ties to Bitcoin, Ray Peat/MAHA, and possibly Christianity. Alternative crypto-powered social networks and like-minded businesses will thrive within its borders. GDP per capita will rank among the world’s highest, birthing several $100B+ companies.
  19. An AI agent will use a blockchain to trade itself into being a billionaire. Marxists will call for its assets to be seized, ignoring that the “agent” is simply an immutable contract.
  20. A core of Ethereum’s strongest evangelists — seeing the geographic decentralization induced by Bitcoin mining — will publicly tout Proof of Work. Privately, some will campaign for it and express frustration over the Merge. Proof of Stake’s insider economics will cripple ETH’s adoption as money. Eventually, the community will ship physical finality as a switch from economic finality inside PoS, restoring neutrality. ETH will roar back as a true alternative to Bitcoin.
Author
Walt Smith
Filed Under
Perspectives
Disclaimer
This post is for general information purposes only. It does not constitute investment advice or a recommendation or solicitation to buy or sell any investment and should not be used in the evaluation of the merits of making any investment decision. It should not be relied upon for accounting, legal or tax advice or investment recommendations. Specific investments described herein do not represent all investment decisions made by Standard Crypto. The reader should not assume that investment decisions identified and discussed were or will be profitable. There is no guarantee that the investment objectives discussed herein will be achieved. Moreover, past performance is not a guarantee or indicator of future results. Specific investment advice references provided herein are for illustrative purposes only and are not necessarily representative of investments that will be made in the future. This post reflects the current opinion(s) of the author(s) and is not made on behalf of Standard Crypto Management LP (“Standard Crypto”) or its affiliates. The opinions reflected herein are subject to change without being updated.