2023 Crypto Assets Review and 2024 Outlook

In 2023, the total value of the crypto assets market returned to $1.7 trillion, with an annual growth of over 110%, marking that the industry has passed through the cyclical winter. Several significant events stood out this year:

1. A well-known trading platform has reached a settlement with US regulators, promoting Crypto Assets companies to move towards compliance.

2. The Bitcoin ecosystem leads a new model for the fair issuance of inscriptions, which is mainly attributed to the technological possibilities brought by the Taproot upgrade.

3. The liquid staking derivatives of Ethereum and their financial applications define the industry's concept of "low-risk returns," and ETH staking yields are regarded as similar to "Crypto Assets government bond yields."

4. Layer 2 expansion solutions are gradually taking over Ethereum's ecological applications, and the total value locked in Layer 2 has reached 20 billion USD, close to the 29 billion USD of the Ethereum mainnet.

5. A certain public blockchain has once again become the focus of the market, with its decentralized physical infrastructure and meme projects in its ecosystem attracting widespread attention.

6. Real-world asset yields have become an important source of profit for decentralized finance lending protocols, with a leading protocol deriving 58.1% of its income from real-world assets (primarily short-term government bonds).

Looking ahead to 2024, the following ten major development trends may emerge:

1. After the approval of the Bitcoin spot ETF, it is expected to bring in over $30 billion in incremental funds.

2. The total market value of Bitcoin's ecosystem inscriptions may exceed $20 billion, but only truly fairly issued leading meme projects can achieve medium to long-term consensus.

3. The second layer solutions for Bitcoin will see rapid development, benefiting the application-based infrastructure of the Bitcoin ecosystem.

4. The total locked value of Ethereum Layer 2 will surpass the mainnet and may reach over 100 billion USD.

5. The total locked value of zero-knowledge rollups is still difficult to compete with optimistic rollups, but the zero-knowledge modular combinations of Ethereum's second layer components will tend to be complete.

6. A certain cross-chain protocol is expected to issue coins in the first half of the year, which is likely to boost market enthusiasm for the full-chain interoperability track.

7. The new narrative of parallel EVM will drive certain public chains that support this technology to achieve secondary growth.

8. The market size of decentralized physical infrastructure may grow tenfold.

9. There may be explosive autonomous worlds or full-chain games with strong social attributes.

10. The integration of AI and Crypto Assets in multiple application scenarios will create star cases, including using Bitcoin as an AI payment currency, and employing zero-knowledge machine learning for sensitive data training and model evaluation.