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1. How much will the market trend next year be affected by the Fed?

Brother Ping:

Regarding the current dynamics of the Federal Reserve, it has announced the acceleration of Taper, and expects to raise interest rates three times next year, and will not raise interest rates during the Taper period. Since the market has basically priced in this expectation in advance, after the expectation is implemented, the current market On the contrary, it is strong. However, if the policy of raising interest rates is implemented, I think it is bound to have a downward impact on risky assets such as cryptocurrencies. However, in view of the current volume and ecological development of the encryption industry, this downturn should not be the kind of unilateral downturn that is deeply bearish, and the wealth effect is more distributed in local sectors.

nn：

The cryptocurrency market is likely to enter a bear market next year. Of course, the dynamics of the Federal Reserve have an impact on it. At present, the Federal Reserve has accelerated the Tapper. It is expected that the Tapper will end next spring, and then the interest rate will be raised. As liquidity shrinks in the market, crypto assets are likely to see declines. Of course, monetary policy has a time lag, and it is expected that the phenomenon of liquidity shortage in the market will not appear until 5-10 months after the official interest rate hike.

Winter Soldier:

As digital assets gradually enter the mainstream view, the price trend of Bitcoin and others will definitely be more and more affected by the external environment. The monetary policy of the Federal Reserve in 2022 will indeed be a bearish factor, but the impact is expected to be relatively limited. There are three reasons:

1) The current market price should already include the expectation that the Federal Reserve will tighten liquidity and raise interest rates three times in the next year;

2) The United States is facing mid-term elections next year, and the Federal Reserve will moderately shrink liquidity, but will still be careful about the consequences of bursting the bubble;

3) From a historical point of view, the impact of liquidity tightening policies on crypto has a certain lag. In the last round of U.S. contraction cycle, the interest rate hike started in December 2016, and the balance sheet shrinkage began in October 2017, while the price of Bitcoin did not last until 2017 It peaked only in December 2010, and it has been about a year since the tightening started. At present, the Federal Reserve has only just launched Taper, and has not even started to raise interest rates. The tightening progress is probably at the level of mid-2016.

Wu Zhuocheng:

The market depends on two aspects: the time for the Fed to raise interest rates and whether the stories in the currency circle are sufficient. At present, the market expects that the debt reduction will continue until the first quarter of next year, and the rate hike will start in the second quarter at the earliest, but it is likely to wait until June. And the stories of the currency circle next year are mainly concentrated in the first half of the year, Polkadot auctions, Ethereum upgrades, game launches (fun games), etc., except for the uncertain time of Ethereum upgrades (June at the earliest), the rest are mostly concentrated in the first quarter. In summary, regardless of the macro environment or the story of the currency circle, it supports the continuation of the market in the first quarter of next year. My personal deduction of the market is: the climax of panic buying in the first quarter, the panic and stampede in the second quarter, the rebound in the third quarter due to the upgrade of Ethereum (but it will not hit a new high), and then the long road of negative decline.

Liu Quankai:

I am still relatively optimistic about the market trend in 2022. The basic judgment is divided into two parts. Battle new high. During the period, it will be hit by various government policy news many times, but these negative effects will not last for too long or change the trend. Second, the plate rotation is obvious and the hot money effect is enhanced, which will be particularly important for the ability to capture potential hot plates. In 2022, the Fed’s interest rate hike and inflation are still the themes. Every move of the Fed is easily amplified by market sentiment. Bitcoin volatility should increase significantly before and after important government decisions or data releases. If the interest rate will be raised in the first half of next year according to market expectations, generally speaking, there is no need to panic too much. First, the current institutional support effect of Bitcoin is obvious. Generally speaking, around 30,000 will be a strong support; Yes, judging from the data after the Fed raised interest rates over the years, there is a time lag in the effect of raising interest rates. Generally, the overall U.S. economy and stock market can remain strong in the first year after raising interest rates, and inflation continues to rise. The linkage effect of Bitcoin and U.S. stocks Stronger, Bitcoin should still maintain a fluctuating upward trend. In the second year, the growth rate of the national economy and US stocks will tend to slow down, bond yields will decline, and the effect of interest rate hikes will gradually appear.

ws：

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2. What is your favorite track for next year?

nn：

The first is the NFT lending/derivatives market. At present, the NFT spot market has gradually matured and has attracted the attention of mainstream society. Judging from the historical experience of market development, NFT will develop into the lending/derivatives market in the next step. However, the special feature of NFT is that its pricing is difficult and lacks market liquidity. Therefore, if you want to develop the NFT lending/derivatives market, you must first solve the NFT pricing problem, that is, develop the NFT oracle machine. In 2022, the NFT oracle/pricing scheme will be the star of the market.

The second is the credit market. The biggest feature of this round of bull market is the influx of a large number of institutional investors. The credit business in the cryptocurrency market is currently in an early stage of desolation. The main reason is that most of the C-end users are anonymous and prone to default risks; however, the credit business for institutions does not have the above problems. With the continuous increase of institutional users in the industry, the credit business for institutions will become the next important market, and the future market size is expected to be comparable to that of the OTC market.

Winter Soldier:

Still optimistic about Ethereum, Ethereum will officially enter the "Serenity" (Serenity) stage next year, for which the industry has been looking forward to for many years. After entering the tranquil world, the performance potential of Ethereum will be further released. It is expected that next year will be the year of Ethereum. In the first half of the year, POW will be converted to POS. In the second half of the year, based on the improvement of various functions of the POS chain, Ethereum will usher in a performance jump and The double benefits of the ecological explosion will also benefit L2 projects and various applications based on Ethereum.

Brother Ping:

1. SocialFi: Now we can clearly feel VC's betting on the SocialFi track. SocialFi projects such as Mem Protocol, CyberConnect, RSS3, and Enso Finance have all received well-known VC investment this year. Of course, the mature outbreak of the SocialFi track will definitely not be in the next year, but the Token of such projects may become a popular target in the market.

2. GameFi & Metaverse: The GameFi & Metaverse projects released this year will basically be officially launched next year. At that time, you will know whether the game is a mule or a horse. We still look forward to the progress of this track.

Wu Zhuocheng:

Public chains (including L2) and games. Next year's story will mainly focus on public chain upgrades and game launches. And the public chain is the infrastructure of the blockchain, and the game is the most likely track to get out of the independent market.

Liu Quankai:

NFT. As the underlying asset logic of the Web 3.0 metaverse, NFT is indispensable. At present, the concept of the metaverse is on the rise, and both inside and outside the circle are blowing up the wind of the metaverse boom. Major manufacturers have announced their entry into the metaverse, and NFT has become the best carrier for traditional manufacturers to enter the encryption field. Unlike FT, which is subject to government laws and regulations everywhere, NFT currently does not have so many regulatory factors interfering, and the concept of Token has been downplayed. Traditional manufacturers can buy NFT in the NFT market openly, and they can also target the encrypted circle. players issue NFT. I believe that next year there will be more unexpected things realized through NFT.

In addition, limited by the current hardware and software infrastructure and the logical system of the metaverse theoretical framework, etc., the metaverse will definitely be a long-term narrative and a big project, and this will also determine whether NFT can be used for a long time. exist and persist. In the traditional field, the Web 2.0 Internet as a whole is already facing the peak of traffic dividends and the problem of retaining existing users. It is inevitable to fall into internal friction and involution. It needs the rekindling of the metaverse, a new narrative track. The Web 3.0 metaverse based on NFT is obviously more advantageous than Web 2.0. Compared with the large-scale online game Web 2.0 metaverse that "cannot take away" anything, the Web 3.0 metaverse is more decentralized and more efficient in terms of underlying architecture and data. Open, the user is the developer, and the developer is the user. As long as someone is willing to develop, anyone can freely enjoy the imaginary world in their hearts and shuttle and explore in different metaverse worlds without any external interference. In addition, NFT endows the concept of things and rights in the metaverse, and has a unique Tokenomics economic system that is in line with reality, and all aspects of future life can be realized in the metaverse. Overall, NFT still has a lot to look forward to.

ws：

1. Web 3.0 infrastructure: Regulatory pressure will draw more attention to front-end decentralized projects that can replace AWS.

2. A public chain that does not require users to pay: If the reason behind Sol's success is ultra-low gas fees and a good user experience, then the new public chain that supports users with zero gas fees will have greater potential. Such as ICP and KDA.

3. Cosmos ecology: Cosmos has shown very gratifying execution in 2021, and ATOM's token model may improve in 2022 + Cosmos has many projects that try to solve real-world scenarios that deserve attention

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3. Other things that you think will happen next year?

Brother Ping:

1. The market value of ETH exceeds BTC; 2. The first Ethereum futures ETF in the United States is approved; 3. There will be new public chains that will stand out with the help of Web3.0.

Winter Soldier:

1. SEC approves ETH futures ETF and BTC spot ETF. 2. The market value of ETH is close to or even temporarily exceeds the market value of BTC. 3. The United States launched a stablecoin regulatory framework. 4. Bitcoin reaches a new milestone of $100,000. 5. Ethereum will successfully complete POS before September.

Uncle Tan: The experiment in El Salvador will fail, that is, Bitcoin will not be used in daily payments in El Salvador; other countries may follow suit, but it is unlikely that countries with GDP rankings in the top 100 in the world will follow suit.

Wu Zhuocheng:

1. Medium-sized countries (the level of Brazil) begin to accept Bitcoin as legal tender or anchor their currency issuance to Bitcoin reserves

2. The market share of Ethereum in the public chain track drops below 50%

3. OP rollup and ZK rollup accounted for 70% to 30% of the market (30% to 70% in 2023)

4. Sports 3A games enter the chain game track (in view of the constant ambiguity between the NBA and the currency circle, LIVE or 2K and may be the first to open the GameFi version)

5. EVM-compatible L1 will plummet by more than 90% (if Ethereum cannot be expanded, and there is no ecology independent of Ethereum, then after Ethereum upgrades, I don’t know why these L1s still need to exist)

6. DeFi LP only has service fee income, no token rewards anymore

7. The pledge amount of Ethereum 2.0 reaches between 30 million and 100 million, achieving temporary deflation (staking more than 100 million may stop deflation)

8. Ethereum can be transferred to POS smoothly, but there is no exact time, as long as it is completed next year, it will not be considered a delay. As Vitalik said, the transition was not a technical issue, but "a human issue". The "people" who are constrained may be miners or internal stakeholders. As the market share of Ethereum in the public chain track further decreases, there is not much time left for stakeholders to fight among themselves.

Liu Quankai:

1. DeFi has a major breakthrough innovation similar to the AMM mechanism, creating a new trend

2. A large number of Dapp protocols are transferred to the second-tier network, and the L2 TVL will exceed 20 billion US dollars

3. Categories subject to copyright disputes in Web 2.0, such as photography and music, will develop rapidly in NFT

4. The corporate form governance project will be challenged by more community-based operation projects

5. Meme culture will continue to prevail, and more Meme tokens will appear and challenge DOGE and SHIB

6. There will be real 3A masterpieces in the game industry next year. For example, the Star Atlas launched on Solana next year is worth looking forward to. Different from traditional games, chain games need to be viewed from both technical and economic aspects. From a technical point of view, I think some game development teams in the blockchain and encryption industries are actually capable of producing a 3A game. In addition, many traditional game giants such as Ubisoft have also announced their entry into the NFT game market , which is also a positive sign. But if you want to make a 3A masterpiece, the team must first be able to endure loneliness and keep the original intention. It takes a long time to polish a game, and a lot of resources are invested. In this market, the speculative attribute is very strong, and the cycle switching style is obvious. The team will face the choice of making quick money or dreaming. The current situation of the chain game market is that most The team all chose the former, flooding the market with bad coins. But I believe that game teams that are really deeply involved in the blockchain industry will polish and release more excellent works with more effort. From an economic point of view, chain games are currently mainly based on mining and Tokenomics in DeFi. The game will inevitably face continuous inflation in the middle and late stages, which hinders the further development of the game. At present, DeFi has not had a breakthrough innovation for quite a long time, which is not good for GameFi. Therefore, I think that if the chain game is to operate more sustainably, it needs the inspiration of DeFi innovation. This year's DeFi 2.0 micro-innovation led by OlympusDAO is eye-catching, and we look forward to more breakthrough innovations next year. If you look at it more deeply, chain games are in line with the development direction of the Metaverse. In the future pattern of chain games, it is very likely that it will further develop into the metaverse, become the metaverse world or a part of it, and GameFi will extend to MetaFi.

ws：

1. The traditional VC game in the currency circle will be overturned in 2022-with the rise of DAO, leeks will no longer be the receivers.

2. Under the zero-sum game, there will no longer be a general rise in the market between public chains in 2021.

3. LUNA may experience the black swan event again. Whether it is suing the SEC or crazily burning Luna to create UST for its insurance agreement Ozone, as long as Do Kwon plays badly, it will collapse like a domino.

4. In 2022, projects like "Sol-Luna-Avax" that will increase by dozens of times will be projects without VC participation

5. Regardless of the macro market environment, we will see a small number of innovative projects skyrocket.

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According to the "Notice on Further Preventing and Dealing with the Risk of Hype in Virtual Currency Transactions" issued by the central bank and other departments, the content of this article is only for information sharing, and does not promote or endorse any operation and investment behavior. Readers are requested to strictly abide by the laws and regulations of the region and do not participate in Any illegal financial conduct. Wu said that without permission, it is forbidden to reprint or copy the content, and those who violate it will be investigated for legal responsibility.

According to the "Notice on Further Preventing and Dealing with the Risk of Hype in Virtual Currency Transactions" issued by the central bank and other departments, the content of this article is only for information sharing, and does not promote or endorse any operation and investment behavior. Readers are requested to strictly abide by the laws and regulations of the region and do not participate in Any illegal financial conduct. Wu said that without permission, it is forbidden to reprint or copy the content, and those who violate it will be investigated for legal responsibility.