a16z: Seven potential directions of the encryption industry in 2023
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Editor’s note: a16z lists the “big ideas” that could inspire the crypto industry in the year ahead, and highlights the problems that startups in their respective niches are likely to tackle in 2023. Here are seven trends for the crypto industry in 2023.
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The "Mobile Era" of Blockchain
How far are we from the "mobile era" of cryptocurrency? A significant portion of blockchain users access the internet primarily through smartphones, but rely on centralized infrastructure (convenient, but risky). At one time, users solved this problem by running their own nodes — a time and resource intensive endeavor that required at least one machine that was always online, hundreds of gigabytes of storage, and about a day to sync from scratch.
— Noah Citron, Engineering Partner, Crypto Team
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Zero-knowledge, multi-party computation, and post-quantum encryption
Zero-knowledge systems are powerful underlying technologies that are key to blockchain scalability, privacy-preserving applications, and more. But there are many trade-offs between the efficiency of the proof, the simplicity of the proof, and the need for a trusted setup. It would be awesome to see more ZK proofs constructed to fill in the gaps between these tradeoffs. Most interesting to me is to see if constant-size proofs (and constant-time verification) require a trusted setup, which would further justify a more transparent trusted setup.
— Valeria Nikolaenko, Research Partner, Crypto Team
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Developers march into zero-knowledge territory
—Michael Zhu, Engineering Partner, Encryption Team
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VDF hardware
—Joseph Bonneau, Research Partner, Crypto Team
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Full "On-Chain Games" and Autonomous Worlds
What if you could create a game world that couldn't be deleted or censored, didn't need servers, and existed forever? We are in the initial stages of a full "game on the chain", or what some call a superset - an "autonomous world" that will be built on top of blockchain technology.
——Carra Wu, Investment Partner of Encryption Team
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non-transferable token
——Michael Blau, Investment Partner of Encryption Team
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decentralized energy
How can we apply the idea of decentralization to energy? For example, the grid is outdated, centralized, and faces other issues such as high upfront capital expenditures and inconsistent incentives. There is great potential in building microgrids, storage and transmission networks by addressing issues such as high capital expenditures and different incentives addressed through tokens. The market for renewable energy certificates (RECs) and on-chain carbon credits is also booming. I'm excited to see Builder continue to expand the possibilities of this blockchain-coordinated decentralized energy category.
