L2 will still be one of the most important narratives in 2024. With the arrival of the dencun upgrade, the significant drop in L2 fees will lead to the explosion of the L2 ecosystem. On L2, in addition to games, perp, defi, nft, social, depin, etc. will also usher in an explosive period.
L2 such as arb, op, zksync, starknet and blast compete with other public chains in all aspects, and with the implementation of EIP-4844 and the evolution of the DA layer, Keeping pace with high-performance public chains in terms of cost and speed, the ecological competition between Arbitum and Solana will be an important highlight in 2024.
zksync will launch an economic mechanism in 2024 and become an important force in promoting the explosion of L2.
If Starknet achieves a breakthrough, it will start from the full-chain game narrative.
In 2024, there will be an L2 project with a diluted total market value exceeding US$100 billion; under optimistic circumstances, there will be an L2 project with a diluted total market value exceeding US$300 billion during the peak period of the cycle. The final pattern of the L2 market cannot yet be determined in 2024, but it will be basically a foregone conclusion after this cycle.
The btc ecology has opened the magic box after the inscription battle. There are many teams exploring expansion, including the decentralization of the index, the evolution of the inscription system, and decentralization Once progress is made in many explorations such as cross-chain, zk proof, L2, etc., firstly, its own ecology will develop; secondly, the integration with the Ethereum ecology will also be accelerated. The exploration of Bitcoin ecology is one of the most striking evolutions of this cycle.
Ethereum L1 has gradually evolved into a B2B chain. Most of the interactions of ordinary users will occur on L2/L3 and a few high-performance L1s. Ethereum has gradually become a leader in the encryption field. underlying assets. At the same time, with the evolution of modular blockchain, Ethereum will become the most important settlement layer, and most of the execution layer and part of the DA layer will be outsourced. But in the end, due to the lowest level security requirements, ETH will still capture the overall The value of ecological growth.
Similar to the prediction in 2023, modularization will still be an important narrative in 2024, especially fierce competition at the DA level. The Ethereum re-pledge field will also enter the DA layer for competition. In the field of modularization, there is competition and integration between the Cosmos ecosystem and the Ethereum ecosystem. There will be competition between third-party DA and native DA. Before danksharding was implemented, the urgent market demand of L2 led to a certain scale of demand for third-party DA.
In addition to the Ethereum and BTC ecosystems, the cosmos and solana ecosystems will also continue to develop, which is consistent with the prediction at the beginning of last year. Cosmos will make progress through modularity; Solana will make progress through some applications. In addition, as the modular blockchain matures, one of Solana's evolutionary directions is to participate in the broader encryption ecosystem like other L2s, and its integration with Ethereum will be higher, thereby capturing greater value.
Web3 games have achieved breakthroughs in L2/L3 (arb, starknet, etc.), and one game has more than one million users (this has not been achieved in 2023, but it should be mature in 2024). Arb-based game chains will become the forefront of web3 game breakthroughs. Magic will be launched in 2024 with the interoperability of game chain + more games, which will have important implications for the evolution of web3 games.
In addition to integrating nft dex, nft lending, and blast, blur is expected to enter nft perp this year, and even the nft market of L2, btc, and sol ecology. Blur will still have a presence in 2024 Opportunity plays one of the most important industry disruptors.
In addition to the explosion of L2 projects, the Ethereum ecosystem is also expected to produce large-scale deflation, thereby achieving value capture. Unlike other L1 chains where additional issuance + fees go to miners as security fees, all new additions and fees are fed back to staking and holding users, which will encourage more users to pledge/re-pledge, thereby further locking in the eth in circulation.
Perp in defi will develop on a large scale in 2024. snx, gmx, gns, dydx, etc. will all generate at least 5 times the trading volume in 2023; perp will not be affected in the bull market. It must be an important narrative, but there is a high probability that it is one of the tracks with the best fundamentals.
The advancement of modular blockchain and cross-chain technology will lead to the integration of the Ethereum ecology, the BTC ecology, and the Solana ecology. This cycle will see the emergence of many currently unknown technologies. Well-known projects. According to the current ecological evolution of Bitcoin, one of the paths may be Ethereum carrying the second layer of Bitcoin. If it comes true, the integration of Bitcoin and Ethereum will gradually increase. No matter what, the expansion of Bitcoin needs to follow its own native path. Similar to protocols such as atomicals, if AVM can be implemented, it will have an important impact on the development of the Bitcoin ecosystem.
Depin has made some breakthroughs in solana and arbitrum. This track is still in the early stages of construction, and more exploratory projects will come out.
AI is still a long way from actual implementation, but this does not affect it from becoming one of the important narratives in 2024. AI protocols based on L2 and high-performance public chains will gradually Appear.
The Ethereum remortgage track will become one of the important narratives at some point this year.
NFT, MEME and Inscription will recover at some point, which will also bring about an increase in NFT DEX trading volume and provide a market basis for the launch of NFT Perp.
Some celebrities have entered the fields of nft, meme, and inscriptions.
With the development of L2 and the exploration of high-frequency applications, smart contract wallets have the opportunity to start to emerge in 2024.
Xu Lin
JinseFinance
Sanya
Cheng Yuan
Ftftx