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Top 17 Trends in Blockchain Technology in 2024

Top 17 Trends in Blockchain Technology in 2024

WEB development
18 min
1393
18.03.2024

Blockchain has garnered considerable acclaim in the realm of technology. Initially, blockchain was envisioned as the cornerstone of the cryptocurrency market, but now it has evolved beyond its origins. Blockchain has emerged as a pivotal force propelling various industries, spanning finance, supply chain management, healthcare, and more. 

In this article, we delve into the expansive blockchain ecosystem, examining its burgeoning trends and possibilities that hold the potential to redefine the world. The evolution of blockchain technology will be manifested in the expansion of decentralized finance, heightened regulatory measures, and increased integration with the Internet of Things (IoT) and artificial intelligence (AI). And these are not all the changes that await us in 2024. 

Let's explore the key blockchain trends 2024 will bring us.

What is blockchain: definition

To answer the question “Is blockchain a future?”, we will start with the definition of blockchain. Blockchain stands as a decentralized, sophisticated, and distributed digital ledger technology that securely records irreversible data (transactions) across many devices. 

Comprising a chain of blocks, each containing transaction details, it ensures a tamper-proof design. When fresh data integrates with a block, it permanently embeds into the blockchain, establishing an irreversible record. This encrypted and chronologically structured data collection constructs a perpetually organized ledger open to authorized users who wield control over data access, determining permissions for others. 

Since the advent of Bitcoin in 2008, blockchain applications have expanded across diverse industries, including trading, financial services, real estate, and voting systems. Blockchain's role can sometimes be less apparent, such as safeguarding patient records in healthcare.

Businesses find value in blockchain due to secure data access, enhanced transparency, intrinsic validation, and improved efficiency and security. Its inherent decentralization facilitates data transfer without government (centralized) control. As Statista shows, spending on blockchain technologies is projected to reach approximately $18 billion by 2024. 

The ensuing blockchain growth stems from its adept handling of core issues. These are network trust, empowering enterprises to focus on problem-solving and reap its top pros.

17 burning tendencies in blockchain for 2024

This section highlights the key trends that will define the blockchain landscape in 2024, from emerging concepts to advancements in established practices. Let's consider the evolution and impact of these trends as we delve into the exciting future of blockchain technology.

1. The quest for Ether alternatives

In the wake of the recent Ether bull run, the cryptocurrency community witnessed a surge in the popularity of Ethereum. Such widespread Ether was accompanied by a notable increase in gas fees within the network. Consequently, this rise in transaction costs posed a significant challenge for numerous projects, rendering some services economically unviable. Due to soaring transaction expenses, simple tasks such as saving a password or acquiring an NFT ticket for an event became impractical.

While Ethereum 2.0 held promise for fee reduction, the decline was not substantial enough to entirely eradicate the demand for more cost-effective alternatives. This situation has fueled a renewed interest in platforms such as Solana, Polygon, Avalanche, and others offering more economically viable solutions. Thus, this trend reflects a pragmatic search for Ethereum alternatives that balance efficiency and affordability in the blockchain technologies niche.

2. The rise in enterprise blockchain adoption

As we approach 2024, businesses increasingly rely on utilizing blockchain-powered smart contracts. These contracts feature explicitly encoded terms within their code, making them self-executing. Upon satisfying specific criteria, these contracts operate automatically, contributing to cost reduction, streamlining complex processes, and diminishing the reliance on intermediaries. 

A noteworthy application is observed in the real estate sector, where smart contracts facilitate seamless transactions and ensure all parties fulfill their responsibilities without complications.

An illustrative example comes from the retail giant Walmart, which employs blockchain technology to trace the food product’s journey from the farm to the table. This innovative approach ensures transparency and food safety, addressing critical concerns for consumers and businesses.

3. Demand for pre-built trading strategies

As the cryptocurrency market expands, more individuals are interested in entering this market. However, profiting from the market has become more challenging due to the rapid changes in the industry. Surely, keeping up with the continuous developments can be overwhelming for many enthusiasts.

In response to this growing complexity, a significant trend has emerged - a surge in demand for products offering ready-made trading strategies. 

Recognizing the value of sharing expertise, businesses enter this niche to provide comprehensive solutions. Rather than merely documenting strategy in writing, these experts actively develop products that automate implementing these strategies. These automated tools utilize professional scripts, allowing users to trade more efficiently in cryptocurrency. 

In general, this trend shows an increasing need for accessible and effective trading solutions amidst digital assets. 

4. The growth of decentralized apps (dApps)

Decentralized finance (DeFi) has emerged as a pivotal trend in the cryptocurrency landscape in recent years. 

Anticipating the trajectory into 2024, we foresee continuous growth and refinement within the DeFi community. The industry's concerted efforts to address challenges related to scalability, security, and functionality are likely to result in more user-friendly DeFi systems. This will facilitate broader access for the general population. Also, this evolution could streamline access to banking services, eliminating the demand for traditional intermediaries.

The expansion of decentralized exchanges (DEXs), loan platforms, and yield farming protocols is expected to change the future of blockchain, fortify the DeFi ecosystem, and foster greater connectivity. Additionally, the integration of cross-chain communication solutions into autonomous financial applications may enhance their adaptability and utility.

5. Adoption of central bank digital currencies

Governments across the globe have shown significant interest in Central Bank Digital Currencies (CBDCs), and the year 2024 may witness substantial advancements in their development and adoption. 

Let's consider some examples.
  • China: Taking the lead in CBDC development, the People's Bank of China (PBOC) has been actively conducting trials for the digital yuan, also known as DCEP (digital currency electronic payment), across various cities.
  • United States: Discussions around the potential introduction of a digital dollar by the Federal Reserve have been gaining momentum, positioning the U.S. among countries exploring CBDC possibilities.
  • European Union: The European Central Bank (ECB) is deliberating the concept of a digital euro, with Eurozone nations collectively evaluating the advantages and challenges associated with introducing a CBDC.
  • Sweden: At the forefront of CBDC experimentation, Sweden's Riksbank is exploring the potential of an "e-krona" to address the diminishing use of physical cash.
  • Japan: The Bank of Japan has been actively researching the feasibility of a digital yen, planning experiments to assess the technical aspects of CBDC implementation.
  • Bahamas: Already pioneering CBDCs, the Central Bank of The Bahamas has successfully provided the sand dollar, establishing itself as one of the first countries globally to introduce a central bank-backed digital currency.

In general, numerous countries are actively researching and experimenting with CBDCs as part of their efforts to modernize their currencies. The potential benefits of CBDCs include simplifying banking systems, expanding financial access, and providing governments with enhanced regulatory tools.

As CBDCs evolve, discussions may intensify regarding the coexistence of state-backed digital currencies and decentralized cryptocurrencies. Striking a balance between innovative concepts and regulatory frameworks becomes crucial to fostering a harmonious collaboration between traditional financial systems and the expanding realm of cryptocurrencies.

6. Increasing blockchain regulation

Rising regulatory measures stand out as a pivotal force influencing the trajectory of crypto security. As the cryptocurrency and digital asset sector matures, global governments and regulatory entities are intensifying their endeavors to establish well-defined guidelines and frameworks for these nascent technologies.

This heightened regulatory focus aims to solve the following issues:

  • Bolster investor protection, 
  • Curtail fraud, 
  • Combat money laundering, 
  • Address other illicit activities.

The implementation of more stringent regulations instills greater confidence in individuals and businesses looking to engage in the crypto sphere. Moreover, increased regulatory scrutiny serves to identify and eliminate malicious actors, fostering a safer environment for all participants.

Governments, recognizing both the potential benefits and risks associated with blockchain technology, are likely to strike a balance between encouraging innovation and implementing regulations to cultivate sustainable growth in this dynamically evolving industry.

In 2024, a pivotal trend revolves around the global attention on cryptocurrency regulation, spurred by the imperative to safeguard investments and counter cybercrime. Nevertheless, navigating this landscape poses a significant challenge due to jurisdictional complexities among various authorities.

What does this new regulatory era hold for investors? Here are some noteworthy aspects:

  • US Crypto Plan: Notably, the $1.2 trillion bipartisan infrastructure plan signed into law by the US president in 2021 incorporated provisions for crypto tax reporting, granting the IRS the mandate to monitor Americans' cryptocurrency activities.
  • The 2023 G20 Summit: Leaders at the G20 summit recently underscored the urgency of this issue, committing to establish a reporting mechanism for cryptocurrency assets swiftly. The objective by 2027 is to initiate the exchange of information on non-financial crypto assets, reflecting a global initiative to regulate digital currencies and manage their intricacies comprehensively.

7. Adoption of AI-enabled blockchain

In 2024, the convergence of AI and blockchain technologies is set to reshape our digital landscape significantly. This powerful alliance, known as an AI-enabled blockchain, is anticipated to bring about substantial changes across multiple industries.

AI-driven algorithms play a crucial role in enhancing the efficiency of blockchain networks. They contribute to making consensus mechanisms more flexible, a vital aspect as blockchain continues to expand to accommodate a growing user base and increased transactions.

Exploration into the synergies of AI has commenced with projects like Ocean Protocol and Cosmos. These initiatives aim to revolutionize trading strategies and enhance immersive experiences within the metaverse. Pioneering the integration of AI and crypto, projects such as Fetch.ai and The Graph lead the way in innovation, unlocking novel use cases across various sectors.

8. Advanced education in blockchain

The upsurge in blockchain education is one of the notable blockchain trends 2024 brings. Remaining informed is crucial for both beginners and experts alike in this rapidly evolving field. Financial institutions are increasingly channeling investments into blockchain technology to maintain competitiveness. JPMorgan Chase & Co., a bank in New York, for instance, has committed over $1 billion to blockchain technology. Also, a leading investment banking company, Goldman Sachs, has established a dedicated division focused on blockchain and digital assets.

Given the ever-changing nature of blockchain technology, continuous learning is imperative. Professionals should embrace this ongoing journey, and newcomers have a prime opportunity to immerse themselves in the field. Governments are also exploring the integration of blockchain technology to improve their services. The Chinese government is actively creating a national blockchain infrastructure, and in India, blockchain technology is being employed to manage land records.

Accessibility to blockchain courses, workshops, and online resources is increasing, empowering learners to comprehend the technical nuances of blockchain, its foundational principles, and practical applications. 

Individuals keen on learning blockchain can achieve success by initially acquiring industry-relevant skills, including the following:

9. Increased stablecoin supply

Stablecoins, tied to fiat currencies or other assets, offer a consistent value, providing a stable alternative to the volatility of cryptocurrencies like Bitcoin or Ethereum. Investors often turn to stablecoins for stability, acting as a secure link between traditional finance and the crypto realm.

The anticipated increase in stablecoin adoption in 2024 is intricately connected to the global economic environment. Amid ongoing economic uncertainties, investors may gravitate toward stable assets, heightening the demand for stablecoins. Additionally, the continued integration of stablecoins in decentralized finance (DeFi) and cross-border transactions may contribute to their expanded usage.

Below, you can see a report by Coindesk showing the stablecoin market cap. 

10. The growth of the asset tokenization trend

Asset tokenization, the conversion of real-world assets into digital tokens on the blockchain, emerges as a process with the potential to revolutionize accessibility and streamline trade. This capability opens avenues for various opportunities in the global landscape. Tokenized assets hold the promise of simplifying investments in areas previously beyond the reach of individuals. 

For instance, this innovation ensures that everyday individuals can participate in the investment of high-value assets such as art or real estate. In general, the ongoing trends in blockchain technology contribute to enhanced transparency, security, and efficiency. 

Examples of asset tokenization: 

  • The real-world asset tokenization process encompasses converting assets like fiat currency, equities, T-bills, credit, commodities, carbon credits, intellectual property, and art. Similar to conventional gold bullion assets and house deeds, these tokens represent bearer assets, granting the holder a claim over a physical asset. Significantly, the tokenization of physical assets facilitates storage, trading, and utilization of assets as collateral across diverse blockchain networks.
  • Digital asset tokenization, crucial in the Web3 era, focuses on tokenizing assets that exist solely in digital form on a blockchain network. This is particularly relevant for use cases involving cross-chain assets and DAO (decentralized autonomous organization) governance rights. As entirely digital entities, tokenized assets on a blockchain grant the owner direct ownership of the asset itself rather than a claim on the underlying asset.
  • Tokenization of in-game assets involves the representation of assets utilized in GameFi projects or metaverses. Examples include tokenized representations of skins, weapons, or in-game currencies.

11. Layer-1 solutions are still promising

Although Ethereum continues to hold its position as the primary smart contract L1 based on various metrics, alternative L1 solutions have displayed considerable potential throughout the year 2023, with a few surpassing Ethereum's performance.

Monitoring this trend as we head into 2024 will be essential to determine whether Ethereum can maintain its dominance in the L1 landscape.

Solana also emerged as the standout performer in 2023, with the market capitalization of the SOL token witnessing a notable surge of approximately 56% in November. Furthermore, Toncoin has equally demonstrated significant progress throughout the year, with a noteworthy highlight being The Open Network's partnership announcement with Telegram in September.

Also, many other noteworthy developments have unfolded across various prominent L1 platforms.

12. The spread of advanced privacy solutions

Undoubtedly, there are numerous fraudsters and criminals in the crypto landscape who have garnered fame (and substantial profits). The recent incidents, including the FTX collapse and penalties imposed on Binance, might only represent the beginning of potential challenges if the industry continues its projected rapid growth. So, privacy and security solutions are especially vital in 2024. 

The integration of cutting-edge technologies and protocols will mark their development and enhancement progress. Notable examples include:

  • Zero-knowledge proofs: Employing cryptographic techniques like zk-SNARKs (zero-knowledge succinct non-interactive arguments of knowledge) to enable secure transactions without revealing underlying details.
  • Confidential transactions: Implementing mechanisms that encrypt transaction amounts, ensuring financial privacy within the blockchain.
  • Homomorphic encryption: Facilitating computations on encrypted data, preserving the confidentiality of sensitive information throughout blockchain processes.
  • Decentralized identity solutions: Introducing self-sovereign identity systems to enable users to control their personal information, enhancing privacy in various interactions.
  • Ring signatures: Augmenting transaction privacy by blending a user's signature with those of others, creating a challenge in tracing the origin of specific transactions.
  • Privacy coins: Continued refinement and adoption of privacy-focused cryptocurrencies such as Zcash (ZEC) and Monero (XMR), prioritizing user anonymity.
These illustrations represent the diverse array of strategies and technologies contributing to advanced privacy solutions within the blockchain domain anticipated in 2024.

13. The fusion of blockchain and the Internet of Things (IoT)

The landscape of our interaction with the world has been reshaped by the Internet of Things (IoT), introducing a network of physical objects equipped with sensors, software, and connectivity for seamless data collection and exchange. These intelligent devices, encompassing everyday items such as wearables to intricate industrial machinery, have paved the way for transformative possibilities.

By facilitating communication between devices and internet-connected platforms, IoT empowers smart devices to autonomously execute tasks and share information. Examples include monitoring environmental conditions on farms, optimizing traffic flow through smart cars, controlling industrial machinery, or managing warehouse inventory.

The analysis of this data in real-time allows businesses to discern patterns, trends, and anomalies, enabling them to optimize operations, enhance efficiency, and bolster their overall performance. In general, the integration of IoT into our daily lives becomes even more ubiquitous as technological advancements unfold.

Blockchain is set to revolutionize the Internet of Things in 2024, with trends focusing on decentralized architecture and cryptographic encryption tools.

The integration of blockchain and IoT creates new possibilities and expands the range of apps. Despite the advancements in IoT, security and data assurance remain concerns. Blockchain steps in by establishing a secure framework for data exchange among IoT devices, mitigating risks related to cyberattacks, fraud, and unauthorized access.

By providing a secure and transparent platform, blockchain enables seamless communication and transactions among IoT devices. This synergy drives innovation in various sectors like smart cities, logistics, agriculture, and healthcare, where IoT devices are pivotal for data collection and automation.

14. Utilization of blockchain in healthcare

In 2024, the healthcare sector is poised for a transformation facilitated by blockchain technology. This will usher in substantial shifts in patient data management, medical record storage, and healthcare transactions. With persistent challenges in data security, interoperability, and transparency, blockchain is anticipated to provide effective and innovative solutions to address these issues in the healthcare industry. 

Here are the main benefits of implementing blockchain in the healthcare field:

  • Enhanced data security: The implementation of blockchain enhances the security of patient data, reducing the risk of unauthorized access and cyber-attacks.
  • Health records interoperability: Blockchain allows healthcare organizations to simplify the seamless exchange of health records, improving care coordination.
  • Efficient and transparent transactions: Blockchain streamlines healthcare transactions, leading to a reduction in errors, fraud, and administrative costs.
  • Patient empowerment and data ownership: Through blockchain technology, patients get ownership of their medical records and gain more control over their health data.
  • Regulatory compliance and standards: The growing adoption of blockchain in healthcare will prompt the development of industry standards and guidelines to ensure data privacy and regulatory compliance.

15. The rise in blockchain gaming

Throughout 2023, a notable surge occurred as various entities entered the Web3 realm via prominent gaming platforms. Notably, social applications such as Sweatcoin and major entities like the NFL attracted users to platforms like NFL Rivals.

On Yavin, the founder and managing partner at Cointelligence Fund, as well as the co-founder and CBO at Syndika, anticipates that blockchain-based games will take center stage in shaping the crypto landscape come 2024.

However, what is the advantage of blockchain games over traditional ones?

In the realm of traditional gaming, game developers wield control over all data and associated servers, creating a closed ecosystem. In this setup, if the company decides to discontinue the game, players are left without a voice. Conversely, when game assets and data reside on a blockchain, the game becomes more resilient. 

Unlike traditional games that rely on subscription models or asset purchases that users can't carry forward, blockchain gaming enables users to earn and own assets indefinitely, utilizing them across various games or virtual realms. The decentralized nature of blockchain games fosters increased community engagement and personal investment. These games are often governed by collectives, such as DAOs, which actively seek user input, resulting in a more player-centric evolution compared to traditional games. DAOs play a pivotal role in shaping the blockchain gaming landscape.

16. The ascent of layer-2 solutions

Smart contracts, integral to blockchain technology for their self-executing and programmable nature, are set to undergo significant enhancements with the introduction of L2 scaling solutions in Smart Contracts 2.0 in 2024. The primary objective is to address scalability issues that prominent blockchains, including Ethereum, have faced, resulting in high transaction fees and prolonged approval times.

The implementation of layer-2 options, such as Optimistic Rollups and zk-Rollups, aims to enhance the efficiency of smart contract systems, making them more accessible and cost-effective. This innovative development has the potential to introduce new options for DApps and stimulate greater adoption by simplifying existing blockchain networks.

17. Expected Bitcoin halving

The "Bitcoin halving" stands as a pivotal event in the cryptocurrency realm, unfolding once every four years and halving the reward for mining new blocks. This occurrence, repeating every four years, diminishes the creation of new Bitcoin, augmenting scarcity and potentially elevating its value by altering the dynamics of supply and demand. The Bitcoin halving garners close attention from the crypto community and investors alike, as it holds the power to influence not only Bitcoin's price but also the broader market dynamics.

Why is it imperative to closely track this significant development in the cryptocurrency landscape, the Bitcoin halving? Above all, understanding that the Bitcoin halving ripples through the entire cryptocurrency market is crucial. The reduction in scarcity often propels the price of Bitcoin upward, outpacing the rate at which new coins become available. Historical data underscores a substantial surge in Bitcoin's value following past halving events.

As we assess the current state of the cryptocurrency market and prepare for 2024, the Bitcoin halving emerges as a salient point of consideration. It underscores the intricate interconnectedness of the cryptocurrency economy and emphasizes the importance for enthusiasts to grasp these evolving patterns.

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Wrapping up

Worldwide experts are anticipating 2024 to mark a significant breakthrough for blockchain technology. The year is poised to witness a substantial uptick in blockchain adoption by both enterprises and governments. This surge is attributed to the continuous growth of DeFi, the ever-expanding realm of cryptocurrency tokens, the intersection of AI and blockchain, the broadening scope of the blockchain-based metaverse, the rise of regulatory measures, and an increased focus on blockchain education, and many other factors. 

These unfolding trends are poised to shape the terrain of digital finance and technology, offering novel opportunities, applications, and challenges for businesses and industries. The forthcoming era holds the potential for a world marked by innovation and transformative shifts.

If you ask, "Is the blockchain the future?" the answer is yes. To create a personal blockchain project, turn to Peiko for tailored blockchain solutions that can pave the way for success in this dynamic landscape. Contact us to share your ideas and receive professional blockchain and custom software development services!

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