There are numerous blockchain trends in 2021, and to appropriately give blockchain growth projections, the current and future trends must be put in proper perspective.
While blockchain technology is itself more than a decade old, the revolutionary features of the tech have stirred a number of use cases affecting many industries today.
In this article, we bring to you the current as well as the future trends of blockchain technology.
If you don’t like reading, you can also watch this video that summarizes this blog post. But as always in life, reading the full story is much more powerful.
Blockchain trends 2021
The blockchain technology ecosystem has been receiving unique attention from various enthusiasts including institutional investors and governments. While many are interested in a particular unique use case this technology offers right now, others watch out for blockchain technology trends in 2021. Understanding what is blockchain technology will make it clear. Trends are not far-fetched from what many are currently accustomed to, however, they represent a new shift in the potentials of digital currencies, smart contracts, and the distributed ledger technology backing these technologies.
Blockchain trends are transitory and can shift at any point in time, especially, looking at DAG vs Blockchain applications. A number of these observed trends may fade off in no time while new ones may present themselves without prior notice. In all, blockchain trends represent the new ways the technology is being harnessed to improve the Internet of Things, enterprise blockchain adoption, supply chain management, and other key applications in the real world.
This section introduces the trends in some niche areas of blockchain technology.
What are the current trends in smart contracts?
Smart contracts are programs that are harbored on the blockchain with a predefined set of instructions. These instructions are executed when the stipulated conditions are met. The adoption, usage, and leverage being placed on smart contracts by enterprises and even individuals today are showcasing the broader trust in blockchain to help create trustless environments for legal agreements to be binding.
The roles of lawyers in drafting business agreements are now being transferred on-chain can be easily and cheaply enforced. Smart contracts are finding additional uses in other areas of finance and their intricate uses are also being explored on a daily basis. The use of smart contracts is thus one of the core trends in blockchain today.
Blockchain in finance trends (DeFi)
Many people can argue that the world of finance is the biggest beneficiary of the blockchain revolution we are seeing today. In the past few years, we have seen notable decentralized finance trends that have not only reshaped the overall outlook of financial transactions but have introduced never-before-seen financial engagements.
The advent of decentralized finance seeks to proffer the exact financial offerings of traditional banks and institutions but with the superiority of blockchain technology. With DeFi, users can gain access to high-yielding savings products, secure hassle-free loans with relatively no paperwork. Many of these products are accessible without compromising your personal data.
The COVID-19 pandemic resulted in a low-interest rate as enacted by financial market watchdogs around the world. This has particularly led to the massive embrace of DeFi products bringing the total value locked (TVL) in decentralized finance products to more than $54 billion, up from $1.57 billion in the year-ago period according to data from DeFiPulse. Today, DeFi lending, borrowing, and its other offerings have become commonplace and are here to stay.
Blockchain hiring trends
Many organizations such as IBM, Amazon, Microsoft, and other startups have already embraced blockchain technology, at a more early stage. With the rise in the overall interest being generated by blockchains, distributed ledgers, and their associated innovations, more companies are beginning o look inward into hiring experts in this space.
Organizations yet to dive deep into the blockchain are continuously placing adverts to hire blockchain application experts, organizations, and consultants to help engraft the tech to bring about their digital transformation. This is seen as a trend today and may crest when the general level of adoption is high.
The bitcoin blockchain security trend
There are numerous blockchain networks operational today, with more blockchain projects being built on a daily basis. While the innovation appears to be growing very fast, old investors and a growing number of new backers place a high premium on the security of the Bitcoin blockchain. This bullish perception has informed the embrace seen from major institutional investors such as Tesla, MicroStrategy, and more.
Since its inception, the Bitcoin blockchain has never been hacked, never gone offline, or suffered any form of downtime. The trust placed on Bitcoin per the security it brandishes has made it remain at the top of the crypto assets ranking, and is billed to remain so for much longer.
Cryptocurrency: Use of Stablecoins to Dominate
Stablecoin technology is beginning to gain traction across the board from both cryptocurrency users as well as traditional financial players. The stablecoins are digital assets whose values are pegged to a fiat currency, most notably the United States Dollar, and the British Pounds. The pegged ratio is usually 1:1, that is, for every stablecoin, there is an underlying currency backing it.
The utility of stabelcoins is growing enormously as their prices do not fluctuate or yield to the impacts of volatilities as with other cryptocurrencies such as Bitcoin and Ethereum. They are used as a hedge against price falls in trading systems, and in the financial world, stablecoins are now trending as a handy resource for a cheaper and faster cash settlement.
A more obvious offshoot of stablecoins is Central Bank Digital Currencies (CBDCs), a government-backed digital asset that is directly pegged to the country’s fiat notes. A good number of economies are beginning to develop their own digital currencies with China, Sweden, the European Union, and Japan amongst others taking the lead.
In the coming years, Stablecoins are likely to dominate the payment ecosystem, and further push the use of banknotes to the sidelines.
The Use Cases of NFTs to be Explored
Non-Fungible Tokens (NFTs) are a major offshoot of digital tokens and a creative application of blockchain technologies to register the ownership of assets on the blockchain. Through NFTs, digital artists can get more value for their works, music, and other digitally created properties that can be housed on the blockchain, making it easy to be verified and free from tampering.
Non-Fungible Tokens and other related digital collectibles saw a meteoric growth this year, with works of art being auctioned for millions of dollars. Marketplaces are now created in a bid to grow the economic ecosystem surrounding the NFT metaverse. While many see the NFT arena as over-bloated especially in terms of the pricing of the items, the underlying technology is going to showcase its full potentials in the near future, with Intellectual Properties, and other valuable works being secured via this channel.
The Rise of Blockchain as a Service (BaaS)
Another major trend is the rise of Blockchain as a Service, as is being championed by the duo of Microsoft, and Amazon. A Blockchain as a Service platform is a cloud-based application that lets enterprises develop blockchain platforms without needing to build the underlying blockchain infrastructure from the scratch.
BaaS is the easy way out for outfits that want to adopt private blockchain technology, and it helps cut the cost of completely creating their own system. This is becoming both a trend today, and likely to dominate the landscape more in the coming years.
Social Media Revamp
The world is becoming a smaller village with the advent of social media. While these forms of media are notably giving everyone a voice, unverified and fake news are bound to fly around in space, a situation that can be corrected through the use of blockchain. The storage of information on-chain will prevent mutability and will let social media users post only relevant and factual information as whatever has been registered cannot be erased and everyone can be held more accountable.
In the coming years, we are likely to see a shift to more mainstream blockchain-backed social media platforms. Most are expected to adhere to decentralization and on-chain governance, with a form of tokenization to reward the platform users.
Interoperability to be the New Utility for Blockchain Systems
The design of blockchain solutions and systems is becoming more flexible such that one blockchain platform can be interoperable with other networks. The utility boosts the overall usability of blockchain platforms, in accordance with their associated products and services. As two of the most used blockchain networks for decentralized finance, the Ethereum blockchain and the Binance Smart Chain both maintain a bridge, wherein tokens from one network could be transformed into the other.
With numerous blockchains being designed, an open system where they all can interact must be pursued and integrated. This will help bring out the value in the innovations that seek to revolutionize the world of finance, the Internet of Things (IoT), and a host of other aspects of the digital economy.
Future trends of blockchain technology
Besides what we are seeing now, there are blockchain future trends that will help ascertain blockchain growth and the complete journey from the current slope of enlightenment to the plateau of productivity according to the Gartner blockchain cycle depiction. Here are a few of the proposed trends for blockchain in the near future.
Blockchain-based voting systems
One of the yet to be developed or adopted applications of blockchain technology is its use in voting systems. The majority of countries practicing democracies are often bedeviled by contentious electoral systems, many of which can be resolved through blockchain technology. Registering votes that are verifiable through blockchain can prevent electoral fraud and other malpractices, and help usher in free, fair, and credible elections.
Cloud infrastructure moves on-chain
When it comes to cloud services, Big techs including Google, Amazon, and Microsoft dominate. Blockchain-based cloud data services are emerging but have not yet permeated the ecosystem yet. In the next years, projects that cater to this need are bound to emerge, a development that is likely to become a major trend in due time.
Blockchains in E-Commerce to Become Ubiquitous
Blockchain technology is also on track to overhaul e-commerce, drawing on the trustless P2P payment capabilities of distributed ledger technologies. As a system that thrives on numerous retail payments, innovators are rediscovering how blockchain can overhaul this niche, and the application thereof is bound to change the face of e-commerce in the near future.
Blockchain is a new technology whose applications go beyond its use in financial services, healthcare, and artificial intelligence. The dynamics of the use cases of the technology have created the emergence of unique trends, culminating in the broader use or acceptance of the technology.
Some of the key trends highlighted include the rise of stablecoins and Central Bank Digital Currencies, the adoption of Blockchain as a Service amongst enterprises, the growth of smart contracts, and blockchain hiring trends amongst others.
While these trends are already enshrined in the crypto ecosystem, the future of blockchain technology still has a lot of undiscovered use cases that will fuel new trends in the near future.
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Is blockchain dead in 2021?
Blockchain technology is not dead in 2021. If anything, this technology is more alive than ever. The impacts of the technology are being felt across many industries that are developing DApps and other platforms to offer value to users globally. Regulators, business executives, and professionals on LinkedIn now boldly associate with blockchain technology. All these are signs of a vibrant and growing technological innovation.
What is the most exciting of the current crypto trends?
All of the crypto trends offer a high level of excitement, especially when profiled along with the solutions they seek to offer. Blockchain technology is designed to alter each industry in a unique way, and as such, offers a unique excitement to different people per time.
When will blockchain become mainstream?
According to the Gartner hype cycle, blockchain technology is currently past the trough of disillusionment and is now at the slope of enlightenment. The technology is just a few years away from the plateau of productivity, wherein the mainstream adoption of the technology is guaranteed. While predicting the timeframe for this supposed transition, it is sure that blockchain has a shorter way towards mainstream adoption than where we have been coming from.