Comments on Pantera Capital forecasts for the crypto market in 2022


One of the investors in Pantera Capital, Paul Veradittakit, was quite brave make predictions for this year in the hectic world of crypto. While we applaud the courage, we are going to drill holes in them. Because this is the Internet, this is what we do here. To be clear, the author went through the biggest trends of 2021, extrapolating them to the future. Which is a pretty safe technique.

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Given that Pantera defines itself as “the first US institutional asset manager to focus exclusively on blockchain,” you know that Veradittakit did not even mention Bitcoin. The following is a purely crypto case. It should be noted that the biggest criticism of Web3 is that it is funded by venture capital, they are the ones who will ultimately benefit from it. And, well, that’s exactly what Pantera: does.

In any case, let’s explore Veradittakit’s ideas and forecasts.

Pantera On L2s և Rollups

Surprisingly, the article begins by throwing Ethereum under the bus. According to Veradittakit, the whole operation will be on L2. They grew exponentially in 2021, և Pantera’s investor considers them important for the scale of Ethereum.

“As crypto acceptance continues to grow, the overload of Ethereum’s network will only worsen, exacerbating the problems associated with delay և payments. Additions are needed to keep Ethereum growing, ensuring that the computing infrastructure is large-scale, allowing users to interact with dApps with similar or even better usability expectations than traditional web applications. ”

Reading this forecast, he says that Ethereum is not going to release any updates to its network this year. Which sounds right?

Pantera with non-Ethereum / Bitcoin chains

This prediction refers to the battle of the L1s or the alleged Ethereum assassins. Pantera’s investor is obviously partial, in particular.

“Recent activity in the Solana community, including the launch of huge funds for decentralized social media և games, suggests that the ecosystem will continue to grow indefinitely next year.”

First of all, you can not have “decentralized social media և games” on a centralized platform like Solana. Second, Veradittakit forgets to mention Solana’s constant technical problems ։ Disconnections. Do whatever you want with it.

Another trend the author points to is bridges, “which allow for interoperability between highly different networks,” which he says will “accelerate the growth of non-Ethereum ecosystems.” Or, more roughly.

“Overall, these advances in cross-chain infrastructure will accelerate the pace at which alternative single-layer chains gain traction, fostering the development of a truly robust, diverse multi-chain crypto ecosystem.”

What the Pantera investor really means is that all other L1s will continue to leach on Ethereum. Which sounds right?

SOLUSD Price Chart - TradingView:

SOL price chart on FTX | Source: SOL/USD on TradingView.com

Veradittakit on Composability and Web3:

This topic is related to the previous one. But the investor of Pantera enters a very interesting topic.

“Decentralized identity projects that allow users to maintain full, more accurate control over their personal data և reputation, allowing them to use unsecured credit cases, know your customer (KYC) rules, etc.” “By 2022, we will see more projects expanding the scope of chain ownership, allowing users to have full, functional control over their identity and property in the digital world.”

One thing is for sure, the world needs “shared access to all services.” No one can handle the number of passwords we need to remember. This is a real problem. In this article, however, the author focuses on Ethereum-based solutions. We want to mention that there is an alternative to using the Lightning Network. And, you know, it goes through a really decentralized network.

Pantera on NFT Expansion

This is his least controversial approach. Veradittakit believes that “NFTs will continue to be very popular next year.” He details.

“By 2022, NFT projects will be significantly more diverse in use, reorganize how we interact, and think more about digital media ownership.”

Nevertheless, transforming Vitalik, NFTs must survive in the bear market before they can be considered successful. Will there be a bear market in 2022? Probably not. Thus, Panther’s prediction is stable.

About Veradittakit Decentralized Autonomous Organizations

This prediction is also quite contradictory.

“Given their high position, I expect DAOs to be a key tool for online, collective action that helps individuals around the world become actively involved in the causes they are interested in.”

And the Pantera investor goes after it.

“As DAO operations grow in complexity, I expect to see more projects to build DAO tools և infrastructure in 2022.”

More DAO և tools to manage them. That sounds pretty much right.

Related reading | Solana. A quick review իր look ahead

Pantera On DeFi Security:

This prediction starts with terrible statistics.

“More than $ 610 million was stolen through DeFi exploits in 2021 (a staggering eight-fold increase from $ 77 million in 2020), և an additional $ 704 million was stolen and then returned by white-cap hackers like those who with the operation of PolyNetwork worth $ 1 million. »:

Given that 2021 was the year of DeFi, this should come as no surprise. Criminals seek success and attention. In any case, look at those numbers, copy them, what they will look like if DeFi reaches the base status.

“In 2022, I expect security to become the focus of DeFi projects, I expect several projects to be launched, such as better smart contract audits, more accurate job monitoring, and consumer protection.”

The question here is whether that is enough? Or are smart contracts a security risk by definition? Will anyone be able to create a non-proprietary DeFi protocol? Who will win this race?

Featured Image by JohannaIris in Pixabay | Charts by TradingView



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