Community-led incubation DAO, New Order, has released a new report dubbed the “2023 Crypto Thesis”. In the report, the DAO has made some bold predictions, with the initial being that the crypto bear market is not over yet. The DAO predicts that the FTX collapse will continue to impact the cryptocurrency market negatively through 2023.
“Liquidity issues and insolvencies will likely continue to be discovered in both CeFi and DeFi services as bankruptcy, and criminal proceedings move forward,” the report added.
EigenLayer to push Ethereum
The DAO also estimates that Ethereum’s Eigen layer will significantly push ETH prices. Ethereum’s EigenLayer is a smart contract layer that enables users to re-stake their stakes to safeguard the underlying infrastructure and middleware layers.
Re-staking means validating and securing other networks with the same staked ETH used to validate the Ethereum network. As a result, ETH stakers have much more leeway with their staked funds, and the trust layer may be extended to non-Ethereum networks, side chains, and middleware.
The DAO estimates that Ethereum would draw in a lot of liquidity throughout the 2023 bear market as investors seek a safe haven. This would, in turn, help “build out the Ethereum capital base,” according to the report. Re-staked ETH security is projected to significantly cut scaling costs for middleware, sidechains, and the decentralized tech stack.
“We believe Eigen will offer the most dramatic change to how decentralized networks are built since the initial introduction of Ethereum in 2015,” the report continued.
Zk – Rollups won’t gain traction
Furthermore, the report predicts that Zero-knowledge (ZK) rollups will not gain significant traction in 2023. The DAO notes that the lack of “product readiness” and insufficient decentralization are the key reasons behind this assumption. Instead, the DAO estimates that Zk rollups would see widespread usage in “non-interactive state proofs” and interoperability.
“Many bridges are expected to begin using ZKPs for interoperability purposes, with several already moving in this direction, including Wormhole, Polymer, and the ZKBridge collective,” the report stated.
