2023 is behind us, and as we step into the new year, we’re faced with a fresh set of opportunities. The past year, dominated by a bear market, was a real test for the web3 ecosystem. We witnessed many projects struggling to stay afloat, while others not only survived but thrived by adding real value to the ecosystem. As we look ahead to 2024, it’s clear that the experiences of the past year have set the stage for new trends that are about to unfold. In this article, we’ll explore five key web3 trends that every product manager in the ecosystem should be aware of.
The year of identity
Identity – Dall·e
2024 is poised to be a crucial year for digital identity. For product managers working on services or applications that require authentication, focusing on decentralized identity management will be essential. This approach puts users in control of their data, allowing them to share only what is necessary for an application’s functionality. We can also expect a rise in the use of verifiable credentials, with Zero Knowledge proofs (ZK proofs) enabling the sharing of proof without revealing the underlying data.
The benefits of decentralized identities and verifiable credentials are significant for both end-users and organizations.
- End-users gain ownership and control over their digital identities, enhancing their privacy.
- For organizations, these technologies enable quick verification of information, fraud prevention, increased data security, and reduced risk of cyber attacks, as sensitive data is not stored in their systems
This web3 trend extends beyond the domain of web3 developers and organizations. Public sector advancements are also evident:
In Switzerland, Partisia Blockchain and the University of Applied Sciences and Arts Western Switzerland (HES-SO Valais-Wallis) are collaborating on a decentralized electronic identity system, focusing on privacy and individual data control. Meanwhile, China is advancing its blockchain ambitions with the RealDID initiative, aiming to create a national-level real-name decentralized identity system. These developments reflect a global move towards more secure and user-controlled digital identities
If you are an Spanish speaker, i strongly recommend you this podcast from our Mighty Block series: “Descentralizando la identidad con web3”
Regulatory Compliance and Governance
Regulations – Dall·e
Regulatory aspects, especially concerning the SEC and ETFs, are becoming increasingly important in the web3 space. As the industry matures, adherence to regulatory norms and governance standards is crucial for ensuring sustainable growth and user trust. Many countries already have some regulations or guidelines for Crypto space.
Recent regulatory developments underscore this trends:
- The European Union’s Market in Crypto Assets (MiCA) Regulation entered into force in June, with a final consultation on Europe-wide regulations to be published early in 2024, and member state mandates taking effect in 2025.(1)
- Hong Kong released new guidelines for virtual asset trading platform operators in June 2023.(1)
- Namibia passed its Virtual Assets Act in last July, with regulations pending.(1)
- Last September, the New York Department of Financial Services (NYDFS) released proposed updates to its framework for token trading businesses to trade tokens and a changed framework for how it would put tokens on its “greenlist” (1)
- Also in September 2023, Dubai’s Virtual Assets Regulatory Authority released regulations on virtual asset activity.(1)
For product managers in the web3 ecosystem, staying informed and compliant with these evolving policies and regulations is a must. It’s not just about creating secure experiences; it’s also about safeguarding our end-users from potential risks and ensuring our services align with this new regulatory landscape.
NFTs reloaded
Bored Ape Reload for 2024 – Dall·e
The NFT landscape in 2023 saw a slowdown, with collections like Bored Ape Yacht Club and Azuki Elementals experiencing significant drops in value. Marketplaces such as OpenSea and Blur responded to this bear market by reducing to try to maintain the interest on people and capture market share
In 2024 the expectation looks more promising, expanding NFT scope beyond just art. A key area of growth is in gaming, which, despite being in the early stages of web3 development, is increasingly integrating NFTs. These digital tokens are an essential part of gaming, providing players ownership of in-game assets, which can then be collected or traded in secondary markets.
As for projections, Blockworks suggests significant growth in the web3 gaming sector,
- At least 2x growth in Web3 games overall (according to Jon Jordan’s Big Blockchain Games List, there are currently 1,037) as of Dec. 19, 2023. (2)
- At least 3x growth in fully on-chain games (according to Jon Jordan’s Big Blockchain Games List, there are currently 54) as of Dec. 19, 2023. (2)
Even if this is not as evolved as gaming, other usage is traceability of physical assets. The transparent blockchain ledger effectively tracks the ownership history of an NFT, bolstering authenticity and provenance.
Consequently, NFTs stand poised to revolutionize the realm of real-world asset ownership and management. In the future, utilizing NFTs could span a wide spectrum of assets, such as art, collectibles, real estate, and even securities.
Web3 onboarding using web2 scalable solutions
Onboarding from web2 to web3 – Dall·e
To truly mainstream web3 and welcome the next billion users, it’s crucial we shift our focus towards a wider audience. Sure, in the web3 space, we’re all about privacy and security – the whole ‘not your keys, not your assets’ mindset. But let’s be real: this appeals more to the early birds and tech enthusiasts who are willing to dive deep.
To grow our ecosystem and make it robust, our game plan should include attracting people, guiding them step-by-step, and gradually unveiling the myriad possibilities of web3.
This year is going to be all about seamless onboarding. As product managers, we need to analyze the onboarding process. How can we borrow and adapt what worked in web2 to make web3’s decentralization more gradual and user-friendly? Our goal here is to ensure our users feel at ease and build confidence in navigating through this new tech landscape.
Blockchain meets AI?
The Blockchain meets the AI – Dall·e
2023 was, without doubt, the year of AI. When this phenomenon appeared in our lives, we started to think about how to collaborate with the decentralized ecosystem. Is blockchain and AI something that naturally is going to work together? According to Vitalik, in the Podcast La Ultima Frontera, “…A lot of people want to be a connection and it’s sometimes hard to find a really big and deep one. There are definitely some smaller ones, for example ZKML (Zero Knowledge Machine Learning)”
Does this mean that as Product Manager we don’t need to worry about this? Well, actually the IA is an incredible tool to help us to improve our products, accelerating the research, helping to brainstorm, or as a simple assistant in our daily operative tasks. So even if there is not an immediate correlation between web3 and AI, is definitely one between what we can achieve using this tool to enhance the ecosystem with our products.
Web3 trends Takeaways
In summary, 2024 for web3 Product Managers is about embracing innovation responsibly, focusing on user empowerment, navigating the evolving regulatory environment, broadening the utility of NFTs, simplifying onboarding, and exploring the synergies between AI and blockchain; to create a safer, more inclusive, and vibrant web3 ecosystem.
