Pantera Capital partner's seven focus areas for 2020

Paul Veradittakit, a partner at the well-known U.S. blockchain venture capital firm Pantera, recently commented on the outlook for blockchain in 2020, highlighting 7 key areas including Facebook's Libra project, Bitcoin halving, central bank digital currencies, among others.

Paul Veradittakit, a partner at the well-known American blockchain venture capital firm Pantera, recently published comments on the blockchain outlook for 2020. He believes there are 7 key areas to watch, including Facebook's Libra project, Bitcoin's halving, and central bank digital currencies.

7 Key Blockchain Areas

(1) Libra and Facebook subsidiary Calibra

Veradittakit believes that Facebook's cryptocurrency project Libra, once successfully integrated into its digital wallet platform Calibra and applied on Facebook, Messenger, and WhatsApp, will become the most successful and mainstream cryptocurrency of 2020.

Due to Facebook's nearly one-third of the world's population user base, the digital wallet Calibra integrated with Facebook will allow users to enjoy services such as peer-to-peer payments and online transactions simply through their accounts.

Veradittakit also stated that Libra's adoption will give the public the opportunity to manage their assets with cryptocurrency and provide a large-scale test for cryptocurrency adoption.

Given Facebook's long-standing criticism regarding data privacy, Veradittakit believes that this is an area that will need improvement for the future of Libra and Calibra.

(2) Bitcoin Halving: May 2020

Bitcoin is scheduled to undergo a halving of block rewards in 2020, which means that under the protocol of 21 million total BTC issuance, the block rewards mined by miners will be halved every few years. (Reducing to 6.25 BTC)

Veradittakit believes this will lead to a bull market, firstly due to the reduced currency supply, which will naturally increase the value of each unit of BTC. Secondly, he believes that the reduced block rewards will decrease the number of miners, which will also drive up the value of cryptocurrencies.

(3) Gaming: Enhancing Efficiency

Veradittakit cited the card game Splinterland on the Steem blockchain and the collaboration between blockchain gaming technology company Enjin and Microsoft on the digital collectible product Azure Heroes as examples. He believes that many have begun exploring how blockchain can change gaming systems and how to integrate this technology on two levels: (1) providing technical resources and (2) gameplay, such as in-game purchases, assets of different players, points, etc.

He expects better smart contracts, second-layer solutions, abstract infrastructure, and digital asset storage in 2020. This will make it easier for developers to integrate digital assets into gaming and character experiences, unlike traditional blockchain games limited by speed.

(4) DeFi Will Continue to Grow

Veradittakit believes that the decentralized finance (DeFi) fever of 2019 will continue into 2020. He expects more mainstream consumers and cryptocurrency enthusiasts to start focusing on the potential of DeFi in real-world lending, collateral, retail payments, and arbitrage.

DeFi services like Maker, Compound, InstaDapp, and others will attract more users, increase the value of related products, generate more active users, and lock more valuable assets inside smart contracts.

Additionally, he mentioned the stablecoin DAI, which may increase mainstream user interest in blockchain products due to a more diversified collateral base.

(5) Central Bank Digital Currencies

Veradittakit believes that China's planned central bank digital currency, the digital yuan, set to launch in 2020, will pique global central banks' interest in online financial systems. Although the digital yuan is not a cryptocurrency and is centrally managed, the widespread application of digital assets will bring more confidence to cryptocurrencies and DeFi.

(6) Infrastructure & WEB 3.0

Veradittakit believes that the Lightning Network's development in 2019 improved speed and scalability, and applications like the API developed by Alchemy, a blockchain development tools company Pantera has invested in, will aid in decentralized development.

Furthermore, he anticipates the growth of cloud technology and Software as a Service (SaaS) in 2020 will lead to more decentralized computing platforms, providing more use cases for users in privacy browsers, gaming, social networks, information search, and more.

(7) Regulatory Obstacles

Veradittakit points out that regulatory issues have not changed much from the past and mainly focus on financial crime, privacy, and definitions.

He believes that technologies like zero-knowledge proofs (e.g., Zcash) will continue to be monitored and restricted due to their privacy. Secondly, after Facebook's attention to cryptocurrencies, privacy issues associated with it will also be a focus of cryptocurrencies and blockchain products.

Lastly, clarifying the differences and classifications between cryptocurrencies and currencies, as well as defining securities and commodities, will be points of concern.

Which Predictions Were Wrong in 2018?

Veradittakit also reviewed his predictions from the past year. He believes he was accurate in predicting the development progress of scaling technologies, the death of ICOs, and industry mergers. However, his optimistic expectations for Security Token Offerings (STOs) and institutional entry fell short. These inaccuracies in predictions are no longer among his focus areas for 2020.

Further Reading

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