Decentralized finance (DeFi) is poised for a landmark year in 2024, following a relatively quiet period. Industry experts are optimistic about the sector’s prospects, anticipating significant growth and mainstream adoption.
Cointelegraph gathered insights from various industry leaders on what the future holds for DeFi in 2024.
Optimistic Outlook for DeFi
Julian Deschler, co-founder of Web3 privacy protocol Elusiv, predicts a resurgence in the DeFi ecosystem. Projects that have withstood recent challenges are expected to drive DeFi’s growth and mainstream acceptance.
Kain Warwick, founder of Synthetix, shares positive sentiment, foreseeing the end of the bear market. Warwick expects the upward price momentum observed recently to continue as liquidity increases throughout the year.
Sam MacPherson, co-founder of Phoenix Labs and contributor to MakerDAO’s subDAO Spark, also sees signs of an emerging bull trend. He notes significant leverage coming online, similar to patterns observed in 2021.
Regulatory Changes and Transparency
Regulation is likely to be a key focus in 2024. Nathan Catania, partner at XReg Consulting, believes true DeFi will remain outside regulatory perimeters, as it doesn’t fit existing frameworks. However, he anticipates a crackdown on hybrid finance (HyFi) projects, which blend centralized and decentralized elements.
Antoni Zolciak, co-founder of Aleph Zero, expects major regulatory developments in DeFi, especially as institutional capital enters the crypto markets. The industry is shifting towards balancing privacy and transparency, with a focus on compliance.
Tokenization Trends
Tokenization is forecasted to be a major trend in 2024. Sveinn Valfells, co-founder and CEO of Monerium, predicts that everything that can be tokenized, including real-world assets (RWAs), will be. He sees on-chain fiat gaining momentum, driven by the tokenization of RWAs and peer-to-peer payments.
Keyrock co-founder and CEO Kevin de Patoul expects tokenization to extend beyond treasuries to stocks, bonds, real estate, and carbon credits. He also predicts the development of yield-bearing stablecoins backed by tokenized Treasury bills.
Danny Chong of Tranchess sees tokenization powering DeFi in 2024, with areas like liquid staking tokens (LSTs) experiencing significant growth.
Layer 2s and Web3 Social Platforms
Layer 2 solutions are another area of focus. Mathieu Baudet, CEO of Linera, expects 2024 to be a year of consolidation for layer 2 protocols, particularly in DeFi.
Sung Min Cho, CEO and co-founder of Beoble, predicts growth in Web3 social platforms, driven by regulatory clarity, consumer demand, and technological innovation.
In summary, DeFi in 2024 is anticipated to be a year of resurgence, regulatory evolution, and significant advancements in tokenization, with a positive outlook from industry leaders.