Blockchain progress in the next decade has been predicted by Coinbase CEO Brian Armstrong. He lists the main points and suggests that mainstream adoption will come from countries with failing economies.
In short, I think over the next decade we’ll see a blockchain, that is both more scalable and includes privacy features, reach about 1B users by the end of the decade (up from about 50M at the start of the decade). Adoption will happen both in emerging markets, where the financial systems are most broken, and from a crop of new crypto first startups producing products people want. By the end of the decade, most tech startups will have a crypto component, just like most tech startups use the internet and machine learning today. Governments and institutions will move into the cryptocurrency space in a big way as well.
In the 2020s, he believes we’ll see layer two solutions, or new blockchains come out which increase transaction throughput by several orders of magnitude. Just like broadband replacing 56k modems led to many new applications on the internet (YouTube, Uber, etc) scalability is a pre-requisite for the utility phase of crypto to really get going. Once we see blockchains with several orders of magnitude scalability improvements, we will new applications start to develop more rapidly (see “the rise of the crypto startup” below).
In addition to scalability, he think we’ll also see privacy integrated into one of the dominant chains in the 2020s. Just like how the internet launched with HTTP, and only later introduced HTTPS as a default on many websites, we’ll eventually see a “privacy coin” or blockchain with built in privacy features get mainstream adoption in the 2020s. It doesn’t make sense in most cases to broadcast every payment you make on a transparent ledger.
There are a number of high quality teams working on next generation protocols today (Dfinity, Cosmos, Polkadot, Ethereum 2, Algorand, etc) and there are great teams working on layer two scaling solutions for existing chains. We will see consolidation of chains (in developer mindshare, user base, and market cap) in the decade to come.
From trading to utility
The 2010’s were largely about speculation and investment in cryptocurrency, with trading driving most of the activity and best business models. This trend will continue to play out in the 2020’s (see market structure, and institutions, below) but the best new companies that get created in the crypto space in the 2020’s will be about driving the utility phase (people using crypto for non-trading purposes). We’ve already started to see the beginnings of this trend, with more customers doing non-trading activity (staking, borrow/lend/margin, debit cards, earn, commerce, etc).
The rise of the crypto startup
This decade we will see a new type of startup become commonplace: the crypto startup. Just like the dot com craze kicked off the idea of an internet startup (and a decade later, just about every tech startup uses the internet in some way), I believe that by the end of the 2020’s almost every tech startup will have some sort of cryptocurrency component.
Other than crypto startups (which will largely start off being a first world phenomenon), the other area of adoption will be in emerging markets where the existing financial systems are a much bigger pain point. In particular, countries with high inflation rates and large remittance markets where crypto can really shine.
We’ll see how many of these predictions turn out to be true. By shifting cryptocurrency from being primarily about trading and speculation to being about real world utility, the 2020s will see a huge increase in the number of people holding and using cryptocurrency, and start to really move the needle on global economic freedom. Blockchain progress in the next decade could spell a revolution in the tech industry.