Blockchain, crypto and the future of Fintech

In 2021 cryptocurrencies reached a market capitalization of $3 trillion, as hundreds of millions of new users bought cryptocurrencies as investments, as a hedge to inflation, or to participate in DeFi protocols. What is the next frontier? What are the trends for 2022 and beyond?


From January 2020 to December 2021, the market capitalization of stablecoins went from $5.9 billion to $163 billion, a 27x increase. A stablecoin is a cryptocurrency meant to mimic the value of another asset such as fiat money or commodities. Stablecoins has been one of the successes of DeFi, where smart contracts have been used to create coins such as USDT or USDC, which mimic the US dollar. Many people use these coins to quickly lock-in gains or reduce volatility in their portfolios. In addition, there are many options where people can deposit their stablecoins with companies or smart contracts for APYs of 5–10%, such as Gemini dollars (GUSD), a stablecoin pegged to the US dollar. The Gemini Earn offered customers a 6.9% APY for their GUSD with no minimum balances, fees, or lockup period. This interest rate is much higher than the savings rates on most bank accounts. There are future regulatory concerns for stablecoins due the risk of economic damage if a hack of a major stablecoin happened, lax or non-existent KYC/AML implementation, and the negative impact on the sovereignty of central banks to implement their monetary policies.

Central Bank Digital Currencies (CBDCs)

 In response to the efficiency that blockchain provides for payments, many countries researching or implementing CBDCs. CBDCs are digital currencies, or tokens, issued by a central bank that represent that country’s fiat money. According to the Bank for International Settlements, more than 85% of central banks around the world are researching, piloting, or in the advanced stages of development of CBDCs. China became the biggest country to launch its CBDC, the digital renminbi, and Nigeria became the first country in Africa to launch its CBDC, the e-Naira. Other big countries or economic unions such as the United States, European Union, and India are at various levels of research on CBDCs. While CBDC is digital, many questions remain whether the blockchains will be public, immutable, and have a limitation on inflation. In addition, there is also a risk to banks if customers abandon holding their funds in local banks in favor of the currency backed by the central bank, which could be interpreted as safer. Whether CBDCs are successful remains to be seen as they may lack many of the properties that make cryptocurrencies attractive.


 The metaverse represents a mix of virtual reality, augmented reality, and 3D virtual worlds where people can interact socially. Activities such as socializing, shopping, or even attending concerts are possible in the metaverse. With blockchain and NFTs, the metaverse has the potential to revolutionize activities such as musical artists selling their albums or ownership of digital land. Some see the metaverse as a way to give ownership and potential profit from users’ activities from big social media corporations like Instagram or Meta back to individual users. Many new metaverse based platforms utilizing the blockchain, such as Decentraland and Sandbox, have become popular. However, many companies have seen the profit potential of the metaverse and are investing heavily, such as Meta.