Comments On Pantera Capital’s Predictions For The Crypto Market In 2022

Considered one of Pantera Capital’s buyers, Paul Veradittakit, was courageous sufficient to make predictions for this yr within the tumultuous world of crypto. Despite the fact that we applaud the braveness, we’re going to poke holes in them. As a result of that is the Web and that’s what we do right here. To be clear, the creator went via 2021 largest developments and extrapolated them into the long run. Which is a secure sufficient method.  

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Contemplating Pantera defines itself because the “first U.S. institutional asset supervisor centered completely on blockchain,” you recognize Veradittakit barely talked about Bitcoin. The next is a purely crypto affair. It’s additionally value noticing that the largest criticism that Web3 will get is that it’s funded by enterprise capital they usually’re those who will finally profit from it. And, effectively, that’s simply what Pantera is and does.

In any case, let’s discover Veradittakit’s concepts and predictions.

Pantera On L2s and Rollups

Surprisingly, the article begins by throwing Ethereum underneath the bus. In keeping with Veradittakit, all of the motion shall be on L2s. These grew tremendously in 2021, and the Pantera investor considers them important to Ethereum’s scalability. 

“As mainstream adoption of crypto continues to develop, Ethereum’s community congestion will solely turn out to be worse, exacerbating its issues with latency and costs. Rollups are vital to sustaining the expansion of Ethereum by making certain that compute infrastructure is very scalable, permitting customers to work together with dApps with related and even higher expectations round usability as with conventional internet apps.”

Studying between the traces, this prediction additionally says that Ethereum is just not going to launch any of its community upgrades this yr. Which sounds about proper.

Pantera On Non-Ethereum/Bitcoin Chains

This prediction refers back to the battle of the L1s, or the supposed Ethereum killers. The Pantera investor is clearly partial to 1 specifically:

“Current exercise within the Solana neighborhood, together with the launches of huge funds for decentralized social media and gaming, means that the ecosystem will proceed to develop immensely within the coming yr.”

Initially, you possibly can’t have “decentralized social media and gaming” in a centralized platform like Solana. Second, Veradittakit forgets to say Solana’s fixed technical issues and outages. Make of that what you’ll. 

One other tendency the creator mentions are bridges, “which allow interoperability between vastly completely different networks.” He considers these will “speed up the expansion of non-Ethereum ecosystems.” Or, to place it extra bluntly:

“General, these developments in cross-chain infrastructure will speed up the pace at which different layer one chains achieve traction, fostering the event of a really strong, numerous multi-chain crypto ecosystem.”

What the Pantera investor actually means is that each one different L1s will maintain leaching on Ethereum. Which sounds about proper.

SOL value chart on FTX | Supply: SOL/USD on

Veradittakit On Composability and Web3

This theme ties with the earlier one. The Pantera investor will get into a really fascinating subject, although:  

“Decentralized identification initiatives, which permit customers to keep up full, extra exact management over private information and repute, enabling use instances round un-collateralized loans, know your buyer (KYC) guidelines, and extra. In 2022, we’ll see extra initiatives increase the scope of on-chain possession, permitting customers to have full, purposeful management over their identification and holdings within the digital world.”

One factor’s for certain, the world wants “a single login throughout all providers”. Nobody can deal with the variety of passwords we’re supposed to recollect. This can be a actual downside. Within the article, nevertheless, the creator focuses on Ethereum-based options. We want to point out that there’s another that makes use of the Lightning Community. And, you recognize, that runs over a community that’s truly decentralized.

Pantera On Enlargement of NFTs 

That is his least controversial take. Veradittakit thinks “NFTs will proceed to develop immensely in recognition via the approaching yr”. He elaborates:

“NFT initiatives in 2022 will present considerably extra range in use instances and can reconfigure how we work together with and take into consideration possession of digital media extra broadly.”

Nonetheless, paraphrasing Vitalik, NFTs must stay via a bear market earlier than they are often thought of successful. Is there going to be a bear market in 2022? Most likely not. So, Pantera’s prediction stands.

Veradittakit On Decentralized Autonomous Organizations

This prediction  can be pretty uncontroversial: 

“Given their heightened prominence, I anticipate to see DAOs turn out to be a mainstream car for on-line organizing and collective motion, serving to people throughout the globe get actionably concerned with causes they care about.”

And the Pantera investor follows it up with this one:

“As DAO operations develop in complexity, I anticipate to see much more initiatives constructing out DAO tooling and infrastructure in 2022.”

Extra DAOs and instruments to handle them? That sounds about proper.

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Pantera On DeFi Safety

This prediction begins with chilling stats:

“Greater than $610 million had been stolen via DeFi exploits in 2021 (a staggering eightfold improve from $77 million in 2020), and a further $704 million in funds had been stolen after which later returned by white hat hackers, like these behind the $600 million PolyNetwork exploit.”

Contemplating 2021 was the yr of DeFi, this could come as no shock. Criminals observe success and a spotlight. In any case, take a look at these numbers and extrapolate them to what they might be if DeFi achieves mainstream standing.

“In 2022, I anticipate to see safety turn out to be an amazing focus for DeFi initiatives, and anticipate a number of extra initiatives launch round higher good contract auditing, exact runtime monitoring, and shopper protections.”

The query right here is, is that sufficient? Or are good contracts a safety threat by definition? Will anybody have the ability to construct an unhackable DeFi protocol? Who will win this race?

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