What will the cryptocurrency market look like in 2027? Here are 5 predictions


The year is 2027. It is a time of great innovation and technological advancement, but also a time of chaos. What will the crypto market look like in 2027? (For those unfamiliar, this is a replica of the 2011 video game, God Ex.)

Long-term predictions are notoriously difficult to make, but they are good thought experiments. One year is too short a period for fundamental changes, but five years is quite enough to change everything.

Here are the most unexpected and outrageous events that could happen in the next five years.

1. The metaverse will not be resurrected

The metaverse is a hot topic, but most people don’t have the faintest idea what it actually entails. The metauniverse is a holistic virtual world that exists permanently (without pauses or resets), operates in real time, accommodates any number of users, has its own economy, is created by the participants themselves, and is characterized by unprecedented interoperability. A variety of applications could (in theory) be integrated into the metaverse, including games, video conferencing applications, driver’s license services — anything.

This definition makes it clear that the metaverse is not such a new phenomenon. Games and social networks that include most of the features listed above have been around for quite some time. Of course, interoperability is an issue that needs to be seriously addressed. It would be a very useful feature to be able to easily transfer digital assets between games — or a digital identity — without being tied to a specific platform.

But the metaverse will never be able to satisfy every need. There is no reason to include some services in the metaverse at all. Some services will remain isolated due to the reluctance of their operators to hand over control of them.

There is also a technical aspect to consider. The cyberpunk culture of the 80s and 90s postulated that the metaverse meant total immersion. Such immersion is now thought to be possible only with the use of virtual reality glasses. VR hardware is getting better every year, but it’s not what we expected. VR remains a niche phenomenon even among hardcore gamers. The majority of ordinary people will never put on such glasses to call their grandmother or sell some crypto on an exchange.

True immersion requires a technological breakthrough such as smart contact lenses or Neuralink. It is highly unlikely that these technologies will be widely used five years from now.

2. Wallets will become “super apps”

An active decentralized finance (DeFi) user is forced to deal with dozens of protocols these days. Wallets, interfaces, exchanges, bridges, lending protocols — there are hundreds of them and growing daily. Living with such a set of technologies is inconvenient even for advanced users. As for the prospects for mass adoption, this state of affairs is even more unacceptable.

For the average user, it is ideal when a maximum number of services can be accessed through a limited number of universal applications. The optimal choice is when they are integrated right into their wallet. Storage, exchange, transfer to other networks, betting — why bother visiting dozens of different sites to access such services, if all the necessary operations can be performed using one interface?

Users don’t care which exchange or bridge they use. They only care about security, speed and low fees. A significant number of DeFi protocols will eventually become back-ends that serve popular wallets and interfaces.

3. Bitcoin will become a unit of account on par with the US dollar or Euro

Money has three main roles – as a means of payment, as a store of value and as a unit of account. Many cryptocurrencies, mostly stablecoins, are used as a means of payment. Bitcoin (BTC) and—to a much lesser extent—Ether (ETH) are used as stores of value among cryptocurrencies. But the US dollar remains the main unit of account in the world. Everything is valued in dollars, including bitcoins.

The real victory for stablecoins will be announced when cryptocurrencies take over as a unit of account. Bitcoin is currently the main candidate for this role. Such a victory will mean a big mental change.

What needs to happen in the next five years to make this possible?

The sharp drop in confidence in the US dollar and the euro is a prerequisite for cryptocurrencies to take over the role of the main unit of account. Western authorities have already done much to undermine said trust by printing trillions of dollars in fiat money, allowing abnormally high inflation to spiral, freezing hundreds of billions in sovereign state reserves, etc. This could be just the beginning.

What if actual inflation turns out to be much worse than forecast? What if the economic crisis is prolonged? What if another epidemic breaks out? What if the conflict in Ukraine spreads to neighboring countries? These are all possible scenarios. Some are extreme, of course, but they are possible.

4. At least half of the top 50 cryptocurrencies will see a steady decline

There is a high probability that the list of top cryptocurrencies will change radically. Outright zombies like Ethereum Classic (ETC) will be delisted, and projects that now seem to have unshakable positions will not only be dethroned, but may disappear altogether.

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Some stable coins are sure to sink. New ones will take their place. Cardano (ADA) will slide down the list to officially become a living corpse. The project is progressing agonizingly slowly. Not only do developers not see this as a problem, they even seem to see it as a benefit.

5. The crypto market will fragment along geographic lines

Cryptocurrencies are global by default, but they are not invulnerable to the influence of individual countries. The state always has an advantage and an extra trick up its sleeve. A number of territories (the United States, the European Union, China, India, Russia, etc.) have already introduced or are threatening to introduce strict regulation of cryptocurrencies.

The factor of international competition is superimposed on domestic state motives. When Russia was heavily sanctioned, some crypto projects started restricting Russian users from accessing their services or even blocking their funds. This scenario may repeat itself in the future with regard to China.

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It is not difficult to imagine a future in which parts of the crypto market will work in favor of some countries while closing themselves off to others. We already live in such a future, at least to some extent.

The opinions expressed are solely those of the author and do not necessarily reflect the views of Cointelegraph. This article is for general information purposes and is not intended to be, and should not be taken as, legal or investment advice.

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