Table of Contents
- 2022 TL;DR
- CoolWallet in 2023
- The Big Crypto 2023 Trends
- 2023 vs 2019
- Final Thoughts
Warning: The following article is for educational and entertainment purposes only and none of it should be considered financial advice.
Welcome to the Big CoolWallet 2023 Preview. It’s been 2 weeks since we ended life support for a toxic 2022 that saw both crypto and traditional financial (TradFi) markets fall from their 2021 all-time highs to shocking lows, and Bitcoin is soaring, currently over the $20,000 mark again. Already there’s palpable excitement and dare we say quite a bit of Optimism in the air that with so much happening in areas such as Web3, DeFi, NFTs, and suddenly AI, this year is going to be another rollercoaster ride. If the last week has been any indication, 2023 has been off to a great start with plenty of good news and huge price pumps to celebrate.
This begs the question- Which narratives and trends will help propel us forward this year as the global economy hopefully rides out a possible recession and the death throes of record inflation? Let’s see where both the crypto industry and CoolWallet are heading in 2023.
In case you took a year off from crypto after the 2021 bull run to buy a deserted island with no connectivity (don’t say Bahamas), here’s what happened in one word. Disaster.
A normal crypto bear market cycle moved into Game of Thrones-like Crypto Winter territory. By December 2021 everyone was so drunk on the gains of the bull market that we didn’t pay enough notice to the Fed’s macro-economic pivot. Soon, rampant inflation led to global interest rate hikes, which made risk-on assets like cryptocurrencies and tech stocks a little too risky and expensive to invest in. This downturn eventually exposed the irresponsible behavior of 2021’s crypto darlings like Do “Steady Lads” Kwon, Sam “1) What” Bankman-Fried, Zhu “Super Cycle” Su, Alex “All Funds Are Safe” Mashinsky and others, as their over-leveraged houses of cards came down in a spectacular fashion.
First, there was the implosion of the algorithmic stablecoin TerraUST, followed by the domino bankruptcies at Three Arrows Capital, Voyager Digital, and Celsius. The culmination came with the epic disintegration of FTX, leaving many in the wider public with the impression that crypto might really be down for the count this time.
DeFi hacks and scams sadly once again hit new record highs with $3 billion lost, as users fell for various phishing campaigns, rug pulls and breaches caused by smart contract vulnerabilities such as blind signing.
In short- 2022 was bad, really bad. Got it? Great. Now let’s move on and never speak of last year again.
First off, we’re going to lift the hood on the CoolWallet App and show you what’s coming this year. Then, we’ll cover the biggest incoming trends for 2023 and what you should know.
CoolWallet- What’s coming in 2023?
- We introduced several new features and supported coins, most notably the best layer-1 and layer-2 ecosystems, for our award-winning CoolWallet Pro and S hardware wallets
- We unveiled CoolWallet HOT, our free hot wallet module for the CoolWallet App which now allows every crypto user in the world to keep their funds in our safe non-custodial wallet and securely switch between cold and hot storage in one app as they wish.
This integration of both cold and hot wallet options for our users has been part of our plans for a long time, with roots all the way back to our launch in 2014. CoolWallet was after all created to provide a hot wallet-like experience for a cold wallet (convenient, available on your phone, feature-packed), hence our name.
In 2023, with a very different blockchain landscape out there, it’s time for CoolWallet to reinvent the private wallet playbook yet again.
CoolWallet App is coming in HOT
Crypto allows you to self-custody your own money and protects us against the failures of centralized financial institutions like banks and central governments. Every few years the majority of crypto users forget this and trade their self-sovereignty away for convenience on centralized exchanges (CEXs). It doesn’t take long before they get punished for it.
Just as 2014’s Mt.Gox hack inspired us to create the first CoolWallet and truly portable Bluetooth-powered cold storage, so has 2022’s FTX and crypto custodial collapses pushed us to do more for normal crypto investors. While hardware wallets provide the safest solution, namely cold storage, for your crypto assets, not everybody can afford or are willing to spend $100 or more on it. We’re getting big into partnering with handpicked NFT collections with an upcoming launchpad and want every holder to be able to keep their NFT in their CoolWallet App. Also, the pace of innovation across Web3 and other crypto areas is so rapid that it’s difficult for physical devices to roll out updates and support fast enough.
The solution: CoolWallet HOT, our feature-rich integrated new hot wallet, which further democratizes crypto self-custody.
Anyone can get a free hot wallet from us to keep their assets safe and access our new Web3 features like an upcoming launchpad and airdrops, and move their assets over to our cold storage when they’re ready to invest in a CoolWallet Pro. Or not, the choice is yours.
PROMOTION: HIROMITA x COOLWALLET- Install CoolWallet HOT now and take part in our exciting Hiromita NFT drop before 19 January.
CoolWallet Pro users can seamlessly move their assets over to cold storage from within the CoolWallet App without fear as the cold and hot wallet modules are completely separate from each other and work independently.
At present CoolWallet HOT is still limited in its functionality and coin support in order to ensure the highest safety standards for a hot wallet. With time though we will add everything you expect to see in a Web3 wallet and more.
CoolWallet’s Upcoming 2023 Milestones
The first half of 2023 will see CoolWallet App roll out new marquee features like a LaunchPad, an in-app Web3 browser as well as a dedicated NFT Wallet. We’ll be covering all of these in our next blog post, so stay tuned.
Importantly, CoolWallet HOT will add support for WalletConnect2.0 as well as the Flare mainnet (FLR) at the end of February, enabling our users want to manage their Flare airdrop. Details will be released next month.
This will be followed up in Q3 and Q4 by multiple cold wallet support as well as a wallet extension. Of course, we’ll be integrating support for more main networks and decentralized trading and staking services at the same time. We’ll provide more details on all these milestones at a later date.
The Big Crypto Trends for 2023
After some growing pains last year, the non-fungible token (NFT) market is set to come into its own in 2023, with many household-name Web2 and global brands finally entering the NFT space. Already, major brands have amassed more than $260M in direct revenue from NFT sales, with secondary volumes reaching as high as $2.8B.
Although this is still not much when compared to the traditional sales figures for blue-chip brands – Nike alone did around $50B worth of business in 2022 – the NFT sector is still new, and its numbers are set to climb.
NFT digital collectibles, in-game NFT purchases, NFTs used for loyalty rewards memberships, and physically redeemable NFTs are just a handful of the use cases set to take off in the coming year. It’s also very conceivable that before we’ve finished circling the sun again, there will be other use cases as yet undiscovered.
Another NFT trend to watch is whatever is happening on Polygon (MATIC). The popular layer-2 chain has been entering into deals with many brands, including the NFL, Starbucks, Nike, Disney, and even Meta. While Polygon’s NFT sales still trail rivals like Solana by an order of magnitude, the effect of many of these partnerships has yet to kick in. Meta in particular could jumpstart a massive NFT boom on Polygon if it were to integrate its platforms.
At the same time, the competition between NFT exchanges will continue to heat up. OpenSea, which had been the overwhelmingly dominant exchange during the last bull run, is now having to make space for newer rivals like Magic Eden and Nifty Gateway. Furthermore, the ongoing debate over NFT creator royalties will continue to rage in 2023.
The GameFi sector would appear to be poised for a breakout year as the big game studios go about integrating NFTs and crypto payments into their offerings. Such direct integrations would mark a new stage in GameFi, where Web3 innovations have so far been largely confined to a separate GameFi realm rather than traditional gaming. It’s worth noting the studios will have to tread lightly with these moves, as it remains unclear whether the wider gaming public is ready to embrace crypto and in particular NFTs.
However, the benefits of selling digital collectibles and reaping secondary sales revenue is likely to prove irresistible for the big players in gaming. Moreover, Web3-native functionalities like the re-programmability of NFTs may increase the appeal for consumers.
The GameFi sector has at times been criticized for being no fun, with turn-based games as entertaining as they sound, and this is something that will have to be ultimately addressed if projections like GameFi becoming a $2.8B industry by 2028 are going to come true. An overreliance on tokenomics rather than gameplay will continue to mean that games can only retain users so long as the market conditions ensure adequate profitability, which can change on a dime based on countless uncontrollable factors.
DeFi- Layer 2s to bury L1s?
Decentralized finance (DeFi) is looking at a reasonably bright year ahead, in part due to the growing recognition that centralized exchanges are not safe crypto-custody providers. Crypto is best stored in a hardware wallet, such as the CoolWallet Pro, with portions brought into hot wallets like CoolWallet Hot as needed.
DeFi has some intrinsic advantages to offer crypto going forward. It’s trustless – running entirely off the back of code – and the transparency it brings to the table aligns deeply with the overarching values of Web3. While it’s currently very vulnerable to hacks, how best to secure DeFi is a problem that will attract some of the best minds in the space.
Scalability will be a major focus for DeFi in 2023, and this has led to many experts predicting this year to be the Year of The L2.
Layer-2 (L2) chains are Ethereum scaling solutions that use optimistic and zero-knowledge (ZK) rollup technology and process ETH transactions on side-chains or off-chain. It will help to push Ethereum, now more energy-efficient and fully proof-of-stake after 2022’s Merge, to new heights as the world’s 2nd biggest blockchain ticks off new milestones like sharding and liquid staking. CoolWallet currently supports the biggest optimistic rollup chains such as Arbitrum and Optimism, and will later also support the most popular ZK chains as well when they issue tokens in 2023.
Ethereum’s “Surge,” which will see expanded use of zero-knowledge (ZK) proofs to boost performance and handle larger transaction volumes, will also have a side benefit of contributing to the security of DeFi with stronger encryption.
One DeFi trend to watch in the coming year is the push towards housing real-world assets (RWAs) on-chain, which can open up liquidity and utility and lure traditional financial (TradFi) institutions onto the blockchain. Key entities like MakerDAO have made moves in this direction, with investments in RWAs and partnerships with banks collateralizing them for loans.
Another area of potential growth is stablecoins. Expanded adoption for these blockchain assets that straddle the border with TradFi could really take off with payments, remittances, and other use cases. There are also encouraging signs of increased government acceptance of them, with countries such as Japan lifting bans on foreign-issued stablecoins.
This year, crypto is going back under the microscope, with scrutiny paid to it like never before, and we can thank the likes of Sam Bankman-Fraud and other crypto villains of 2022 for that. The main objective of financial regulators is to protect their country’s retail investors, and as multiple billions of dollars were flushed away from normal users’ portfolios due to crypto custodians’ mismanagement and criminal behavior, the lack of clear regulation can no longer be ignored. In the short term, new regulation will hurt, but in the long run, it will help bring in the big mainstream institutional and retail investors that we so desperately need.
What that regulation will look like is all very open-ended for now, as the rules seem to be arriving piecemeal in different parts of the world. Everyone seems to be waiting for everyone else to make the first major move.
At present, it seems like the European Union’s Markets in Crypto Assets (MiCA) framework will be the first to arrive, as it is set for a final vote in February. Other regulatory packages in the US and other countries will arrive sometime after and promises to cover DeFi, stablecoins and more. No comprehensive frameworks are likely to come into enforcement this year, at least not entirely; however, even by just revealing the new rules, the resultant clarity may be enough to see more TradFi institutions wade in.
2023 vs 2019- no pain, no gain
For many people, 2023 will bring new pain and finally a point in the crypto cycle where they cut their losses and exit the action, only to buy back in a couple of years later when Bitcoin starts rocketing again. One can only hope that in the coming years, the industry will prepare the infrastructure to show them a smoother ride next time.
For those who have seen this before, the rolling cycles of bust and boom, where entirely new sectors of crypto emerge – then attract the smart money, then the dumb money, then go pop – know this is just how it goes in this industry.
We’re deep in the bear market now. The capital is scarcer, the charts are grim, and this time, the regulators are hovering – and yet those individuals with value to add are indifferent to the noise; they will keep on working. The crypto builders – those engineers and businesspersons pulled from the ranks of the world’s most capable – will be refining the tech and use cases that will power this industry for decades to come.
Looking back at 2018 and 2019’s bear market for those of us who were here, it wasn’t the price drops that finally drove many hardcore HODLers out, but more the months upon months of sideways price action and overall industry inertia that seemed to show that the sector was dead. Now we know better, that crypto builders are always on the lookout for the next Big Thing, whether it be 2020’s DeFi Summer, 2021’s NFT explosion, or 2022’s Rise of the Layer-2s, will help break down the doors to mass adoption.
Understand therefore that this year is no different. New fields like Web3, the metaverse, artificial intelligence, DeFi, and GameFi are taking off, and the wheels for the industry’s next big leaps are already in motion. By the end of this decade, cryptocurrency usage will likely fit like an important piece to solving each new digital sector big puzzle.
Thanks for reading! Before we wrap things up, just a final caveat emptor (“buyer beware”) warning:
None of this article’s content is financial advice, but opinions only. Always self-custody and self-educate yourself with crypto as much as you can. And always do your own research (DYOR) before investing any of your hard earned money into any risky asset. We could have another brutal financial year due to macroeconomic events beyond our control, so invest sensibly, keep some dry powder to dollar-cost average where you can, and just stay safe.
And remember 2022’s big lesson: Not your keys, not your coins.
CoolWallet wishes you a year of great personal and financial growth in 2023!