2021 has been a significant year for crypto with no fungible token (NFT) being awarded word of the year, decentralized finance (DeFi) trending in the mainstream media and crypto companies making headlines for a variety of announcements.
This is, no doubt, in part due to the effects that COVID-19 has had on the economy, with many looking for new ways to diversify their finances and a move to working from home giving people the free time to research new interests. And, many chose to get involved in crypto.
As conversations began to move on from Bitcoin (BTC) to other larger crypto projects like Ethereum network upgrades and central bank digital currencies, or CBDCs, news coverage would suggest that the mainstream adoption of crypto is already well underway.
However, there is one project which could have the ability to catapult crypto well and truly into everyone’s day-to-day lives: Web3.
With an emphasis on community, Web3 represents the future of the internet where users operate in a decentralized way rather than relying on large private businesses or centralized government bodies.
To many, this seems like the next logical step for the internet, where the concept is partially built on the shortcomings of Web 1.0 and 2.0 such as the concentration of power within centralized entities and issues relating to privacy.
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We’ve already seen examples of this within the crypto and DeFi spaces such as the MakerDAO project, which seeks to build an unbiased global financial system run by the community. As DeFi popularity grew in 2021, more projects and protocols made their way onto the market, all vying to bring the benefits of DeFi to as many people as possible.
Similarly, protocols such as Nereus have been designed to address issues of fair governance and user experience, both of which mirror the existing issues of Web 2.0.
While it may seem like Web3 and DeFi protocols are separate projects (which they are), these protocols are laying the groundwork for Web3 and its adoption.
We’re still some way away from seeing Web3 become a reality, but the DeFi protocols coming onto the market not only offer a taste of what the next iteration of the web might be like but also provide opportunities for feedback and tweaking to help make sure Web3 truly serves everyone to the best of its abilities.
So, would this mean that crypto would be truly mainstream?
Arguably, yes. As of Jan. 2021, there were around 4.66 billion active internet users around the world, and if Web3 became the default, every one of those users would end up using blockchain and crypto technology on a daily basis, even if they weren’t aware of it.
However, the main issue lies in what Web3 would even look like. And, as a community project, it means there isn’t always one single direction for the next phase of our internet. As such, some have argued that widespread adoption would be difficult due to technical gatekeeping and a lack of clear direction.
While crypto use has been on the rise since the pandemic, the increase in new wallet holders has started to slow down. This would suggest there’s something blocking the next step of mainstream adoption.
While it’s possible that waiting for the implementation of Web3 could be the reason, government regulation could be another factor to help drive crypto into the mainstream.
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Previously, crypto hasn’t been seen as easily accessible to the mass market due to its complexity and perception of volatility. Opinions have started to change as more accessible crypto products come onto the market such as stablecoins, crypto-enabled debit cards or DeFi products.
Despite the multitude of benefits crypto and DeFi can offer, some people remain skeptical due to lack of government oversight, which is a very understandable stance. Would crypto move into the mainstream then if governments began to set out guidelines?
Based on the evidence we’ve seen, the answer is surely a resounding yes. Arguably, crypto is already “mainstream” in countries with comprehensive regulation such as Singapore or countries with governments strongly in favor of cryptocurrencies, such as El Salvador and, most recently, Tonga.
It only remains on the sidelines in countries still drawing up frameworks and deciding on their stances on crypto. - Cointelegraph.
