Coinbase: Crypto Market Outlook for 2024 (Full Text)

Key points

• We believe institutional funding will continue to flow to Bitcoin until at least the first half of 2024 – thanks in part to pent-up demand from traditional investors seeking access to this market.
• We believe that 2024 will provide a favorable macro tailwind for risk assets, and more importantly, the foundation of crypto regulation will continue to be established, thereby promoting long-term adoption.
• We believe that developers will continue to develop real-world use cases – the foundation is already obvious.
• We believe that the foundation for a better crypto user experience is being built, which will help the industry bridge the gap from early adopters to mainstream users.

In 2023, the total crypto market capitalization doubled, suggesting that the asset class has survived the "winter" and is currently in transition. Still, we think it's too early to label this or see the positive performance as a testament to the cynics who revel in the over-exaggerated demise of cryptocurrency. What is clear, however, is that despite the hurdles facing the asset class, the development we have seen over the past year has exceeded expectations. They prove that cryptocurrencies are here to stay. The challenge now is to seize the moment and build something better.

The catalyst for cryptocurrency recovery in 2023 is sometimes unrelated to the innovations that typically characterize its value. The regional banking crisis in the United States and the spread of geopolitical conflicts have strengthened Bitcoin's position as a safe-haven alternative. In addition, spot Bitcoin ETF applications from some of the top financial institutions in the U.S. have implicitly acknowledged the disruptive potential of cryptocurrencies. This could be a harbinger of greater regulatory clarity, removing friction that has hindered capital inflows into the asset class.

But progress is rarely in a straight line. To create a more resilient marketplace, developers need to continue to build real-world use cases that help us bridge the divide from early adopters to mainstream users.

The foundations that this could bring are already clear – from web2 analogues like payments, gaming, and social media to cryptocurrency-specific advancements like decentralized identity and decentralized physical infrastructure networks. The former is easier for investors to understand, but these projects face an uphill battle against established web2 giants. The latter may change the technology landscape, but it will take longer to develop and meaningful user adoption will be more distant. However, blockchain infrastructure has come a long way in the last two years, providing the necessary conditions for experimentation and innovation in these applications and bringing us closer to an inflection point.

Tokenization is another important use case that is currently attracting traditional financial players into this space. Full implementation may take another 1-2 years, but the resurgence of the tokenization theme reflects the economic reality that the opportunity cost is higher today than it was right after the pandemic. This makes the capital efficiency of the just-in-time settlement of repos, bonds, and other capital market instruments even more important.

Against this backdrop, we believe the long-term trend of institutional crypto adoption will accelerate. In fact, the late-stage rally in 2023 is already rumored to have started to attract a wider range of institutional clients into the crypto space, from traditional macro funds to ultra-high-net-worth individuals. We expect the launch of US spot Bitcoin ETFs to drive this trend, potentially leading to the creation of more complex derivatives that rely on compliance-friendly spot ETFs as a foundation. Ultimately, this will improve liquidity and price discovery for all market participants.

In our opinion, all of these represent some of the fundamental themes of the cryptocurrency market in 2024, which we will discuss in this report. If you have questions about our work or would like to learn how Coinbase's institutional practices can help your company participate in the cryptocurrency market, please contact us at institutional.coinbase.com.

Topic 1: The Next Cycle

Bitcoin supremacy

Traffic in 2023 is largely in line with our expectations in the 2023 Crypto Market Outlook. Digital asset opt-ins shifted to higher-quality names, resulting in Bitcoin's dominance steadily rising above 50% for the first time since April 2021. This is largely driven by a variety of factors for well-known and established financial giants to apply for spot Bitcoin ETFs in the United States, as their participation in the space helps validate and enhance the prospects of cryptocurrencies as an emerging asset class. While there may be some capital shifting to riskier parts of the asset class next year, we believe institutional flows will remain firmly anchored to Bitcoin until at least the first half of 2024. In addition, pent-up demand from traditional investors seeking to enter the market will become more difficult to replace Bitcoin hegemony in the short term.

Bitcoin's unique narrative has allowed it to outperform traditional assets in the second half of 2023, and we expect this to continue next year. Unless a broad risk-off environment triggers liquidity needs, we believe Bitcoin is likely to perform well even in a more challenging macroeconomic backdrop. For example, fiscal dominance in the United States and other countries may limit restrictive monetary policy, leading to the marginalization of capital. The U.S. commercial real estate sector looks fragile and could put new pressure on U.S. regional banks. Both of these developments should amplify the long-term trend of adopting Bitcoin as an alternative to the traditional financial system. All of this could reinforce the narrative of the deflationary supply plan associated with the April 2024 Bitcoin halving.

New trading regime

The last crypto winter (2018-19) ended with the advent of decentralized finance (DeFi) and the rise of multiple alternative layer 1 networks (L1s) that were ostensibly built to meet the anticipated demand for on-chain block space. Protocol experiments on these platforms allowed cryptocurrencies to further mainstream before overall activity came to a standstill at the end of 2021. As a result, it turns out that more block space is not necessarily needed. In anticipation of the ensuing downturn, the developers decided to take advantage of the crypto winter to build. They are committed to solving the technical barriers that hinder the development of new blockchain use cases.

The first phase of this progress is to build the infrastructure needed to enable the future of web3, such as scaling solutions (Layer 2), security services (re-staking), and hardware (accelerators for zero-knowledge proofs), among others. These remain significant investment opportunities in the cryptocurrency space, but arguably, a lot of infrastructure has been built over the past two years. As this has led to the emergence of more decentralized applications (dapps), we believe that the trading regime of cryptocurrencies will transform with these efforts. That said, we expect more market participants to focus on finding potential web3 applications to help crypto bridge the gap between early adoption and mainstream use.

Many market players rely on web2 analogues to realize their investment ideas in this area, such as payments, gaming, and social media. Other use cases with a more unique crypto-native flavor have also emerged, including decentralized identity, decentralized physical infrastructure networks, and decentralized computing. We believe the challenge is not only to identify the industry, but also to pick the winners. Dominance in any given area is not just about having a first-mover advantage (although it helps); It also involves implementing the right network effects and monetizing them. By early 2004, at least 6 other social media platforms, including Friendster and MySpace, had achieved some success, but not reached the same network size or visibility as Facebook. Given the nascent digital asset class, we expect many market participants to rely more on proxy and platform games to capture the opportunities we see in the next cycle.

The first level of equilibrium

In our view, the slowdown in on-chain activity over the past two years has reduced the need for a "generic" alternative to Layer-1. Ethereum's dominance in smart contract platforms remains solid, and there is little room for direct competition. Approximately 57% of the total value locked in the crypto ecosystem is located on Ethereum, and ETH's dominance of 18% of the total crypto market cap is still greater than any other token except BTC. [1] As market participants become more app-focused, we expect more alternative L1s to repurpose their networks to better fit the changing narrative. For example, more industry-specific platforms are already spreading in the ecosystem. Some focus on games or NFTs (e.g., Beam, Blast, Immutable X), while others focus on DeFi (dYdX, Osmosis) and/or institutional actors (Avalanche's Evergreen subnet, Kinto).

At the same time, the concept of modular blockchains is gaining popularity in the crypto community, with many L1s stepping in to implement one or more core blockchain components, including data availability, consensus, settlement, and execution. In particular, Celestia, launched on mainnet in late 2023, relaunched the conversation around modular blockchain design by providing an easily accessible add-on data availability layer. [2] That is, other networks and rollups can use Celestia to publish transaction data and guarantee that the data is on-chain for anyone to inspect. Other Ethereum Virtual Machine (EVM)-compatible L1s have chosen to focus on smart contract execution, such as Celo, by transitioning to Ethereum L2. [3]

That said, integrated (or holistic) chains like Solana still have an important place in the crypto ecosystem, which means that the debate between modularity and integration may not be resolved anytime soon. Nonetheless, we believe the trend of increasing chain differentiation – both by industry and function – will continue into 2024. However, the value of these blockchains ultimately still depends on which projects are being built on them and how much usage they attract.

The Evolution of Layer-2

The emergence of new rollup stacks such as OP Stack, Polygon CDK, and Arbitrum Orbit, as well as the abstraction of functionality into dedicated layers, have accelerated the rapid growth of Layer 2 scaling solutions. As a result, developers are able to more easily build and customize their own rollups. However, despite the surge in the number of L2s, they have barely shifted activity out of the Ethereum mainnet and have instead cannibalized activity from alternative L1s.

For example, if we compare the canonical bridges that connect Ethereum to L2 and replace L1, we see that the share of ETH locked on the Rollup bridge has grown from 25% of all bridged ETH at the beginning of 2022 to 85% at the end of November 2023. At the same time, despite the growth in rollup usage, the number of transactions on Ethereum remains relatively stable, averaging around 1 million per day. In comparison, the total activity of Arbitrum, Base, Optimism, and zkSync currently averages over 2 million transactions per day.

In addition, modularity is manifesting itself in the L2 domain in a completely unique way. Eclipse has garnered a lot of attention in 2023 as a "general-purpose" scaling solution that relies on a modular architecture to challenge existing conventions. Notably, Eclipse relies on (1) the Solana Virtual Machine (SVM) for transaction execution, (2) Celestia for data availability, (3) Ethereum for settlement (security), and (4) RISC Zero for zero-knowledge fraud proofs. This is just one example of how we can start doing some experimentation with different (non-EVM) VMs on the execution layer, although the impact on the ecosystem remains to be seen. With the Dencun fork also coming in Q1 2024, we may also see a decrease in transaction fees for L2 settlements to Ethereum.

Theme 2: Resetting the Macro Framework

The road to de-dollarization is long

De-dollarization is likely to continue to be a perennial topic in 2024, especially in an election year. However, the reality is that the dollar does not face any threat of losing its global hegemony (or "exorbitant privileges" in the words of former French President Valéry Giscard d'Estaing) in the near term. It is clear that the dollar is at an inflection point, and although de-dollarization may take many, many generations to unfold, the global monetary system has begun to move away from the dominance of the dollar – and for good reason. Macroeconomic imbalances in the U.S. are exacerbating as the cost of servicing the U.S. debt burden is projected by the Congressional Budget Office (CBO) to increase the federal deficit to $1T, or 3.1% of GDP, by 2028. The CBO expects the federal deficit to widen from an average of 3.5% of GDP to 6.1% over the next decade.

On the other hand, the topic of de-dollarization has been a topic of discussion since at least the early 80s of the 20th century, and despite this, the dollar remains the world's reserve currency. In fact, the dollar's huge role in global finance and trade has meant that the dollar's share of all international transactions has hovered around 85-90% for the past four decades. (See Figure 5.) What has changed is the weaponization of global finance, which began with the United States ramping up sanctions against Russia over the war in Ukraine. As more and more countries sign bilateral agreements to reduce their dependence on the US dollar, this has accelerated interest in developing new cross-border payment solutions. For example, France and/or Brazil have started settling commodity trade in renminbi. [4] More trials are underway with CBDCs to avoid today's cumbersome correspondent banking system.

Cryptocurrency advocates argue that Bitcoin and other digital stores of value play an important role in the transition from a unipolar to a multipolar world, as the value of owning supranational assets that are not owned or controlled by any single state seems obvious. Currency changes often occur during periods of socio-economic upheaval, and these changes can only be fully understood after they occur, such as paper money in 11th-century China, promissory notes in 13th-century Europe, or credit cards in the United States in the mid-20th century.

On the other hand, while digital cash and distributed ledgers may be a major part of the next transformation, replacing the dollar in the global financial system will not be an easy task. On the one hand, the entire crypto market cap is only a fraction of the $13T-denominated bonds available to non-bank institutions outside the United States. [5] The share of the US dollar in foreign exchange reserves has declined over the past 30 years, but remains the overall majority at 58%. [6] But Bitcoin doesn't necessarily need to disintermediate the dollar in order to play its valuable role as an attractive alternative in a volatile situation, which could help it find a place in the reserve assets of more countries. The structural adoption of Bitcoin and cryptocurrencies also does not depend on the collapse of the US dollar, which explains why we saw Bitcoin strengthening in tandem with the US dollar earlier in the second half of 2023. In the long run, the changes in the monetary system that are taking place and the role of cryptocurrencies in it may be significant, even if we may not be long enough to see the overthrow of the old order.

Economic outlook for 2024

The likelihood of a US recession avoiding a 2024 recession has increased dramatically in recent months, although the likelihood of a recession is not zero – as highlighted by the fact that the US Treasury yield curve is still heavily inverted. The unique economic resilience of the United States this year has been driven by high levels of government spending and nearshoring efforts to strengthen domestic manufacturing. However, we expect these effects to fade in the first quarter of 2024, leading to a weaker economy amid relatively tighter financial conditions. But we don't think it will necessarily lead to a recession. Instead, a recession will depend on endogenous factors, such as the likelihood of another weakness in the U.S. banking system or the overall pace of deflation.

Regarding the latter, we have been arguing since March 2023 that inflation has peaked and that a slowdown in aggregate demand should periodically support a stronger deflationary trend ahead. [7] To a large extent, this is already a reality, and structural forces such as AI can lead to greater automation and lower input costs. That said, demographic changes – such as the departure of baby boomers from the labour market – could act as a counterbalance. In summary, we believe that a slowdown in the economy and easing price pressures should pave the way for the Fed to cut interest rates in mid-2024 or even earlier.

In our view, a lower cost of capital is likely to support risk assets in Q2 2024, but Q1 '24 may present some challenges depending on how well the Fed's stance consolidates. In this case, the cryptocurrency may not be completely immune. But our economic outlook also translates into a weakening trend for the dollar next year, which will be an opportunity for cryptocurrencies, as these assets tend to be priced in dollars. While the correlation between changes in many macro variables and Bitcoin (and Ether) returns has declined over the last year, the appropriate macro backdrop still forms a core part of our overall constructive market argument for 2024.

Interpretation of regulatory tea

In a recent survey of institutional investors commissioned by Coinbase, about 59% of participants said they expect the company's allocation to digital asset classes to increase over the next three years, while one-third said they have increased their allocation for several months over the past 12 years. This confirms that cryptocurrencies remain an important asset class globally, with broad business and investor appeal. However, while many jurisdictions around the world are taking decisive action on cryptocurrency regulation, uncertainty in the U.S. is leading to missed opportunities and enforcement-focused market restrictions. In fact, 76% of respondents believe that the lack of sensible and clear cryptocurrency regulation in the United States already threatens the country's position as a leader in financial services.

Moreover, regardless of the specific language used in the 2023 guidelines and other public statements, the market's perception is that the attitude of the US banking regulator towards the digital asset ecosystem is at least unfavorable, while some see it as outright hostile. As a result, all but the largest and most reputable cryptocurrency companies are likely to have difficulties establishing banking relationships. Intentionally or not, the regulatory gates established by the U.S. through no-objection letters and other licensing requirements have reduced the incentive for banks to invest in digital asset technology or to accept customers who actively participate in these activities.

On the bright side, we believe more U.S. lawmakers recognize the rising risk of global regulatory arbitrage as multiple U.S. House committees move forward with the Payments Stablecoin Clarity Act and the 21st Century Financial Innovation and Technology Act (FIT 21) in 2023.

In addition, the potential approval of a spot bitcoin ETF in the U.S. could expand crypto access for new categories of investors and reshape the market like never before. Compliance-friendly ETFs could become the basis for a new set of financial instruments, such as loans and derivatives, that can be traded between institutional counterparties. We believe that the groundwork for cryptocurrency regulation will continue to be laid in 2024, leading to greater regulatory clarity and greater institutional involvement in the field in the future.

Theme 3: Connecting to the Real World

Tokenization, Redux

Tokenization is an important use case for traditional financial institutions, and we expect it to be a major part of the new cryptocurrency market cycle as it is a key part of "renewing the financial system." This primarily involves automating workflows and eliminating certain intermediaries that are no longer needed in the asset issuance, trading, and record-keeping processes. Not only does tokenization have a product market that is well-suited to distributed ledger technology (DLT), but the current high-yield environment makes the capital efficiency offered by tokenization even more important than it was two years ago. In other words, it is much more expensive for institutions to take up money for even a few days in a higher interest rate environment than in a lower interest rate environment. [8]

Over the course of 2023, we've seen dozens of new entrants on public permissionless networks begin to provide access to tokenized U.S. Treasury exposures directly on-chain. As digitally native users seek yields unrelated to traditional crypto revenue sources, total assets of on-chain exposure to US Treasuries, increased by 6x to more than $786 million. Given customer demand for higher-yielding products and the need for diversified sources of return, we are likely to see tokenization expand to other market instruments, including equities, private market funds, insurance, and carbon credits, by 2024.

Over time, we believe that more business and financial sectors will incorporate aspects of tokenization, although regulatory ambiguity and the complexity of managing different jurisdictions continue to pose significant challenges for market participants – while integrating new technologies into legacy processes. Due to risks associated with public networks such as smart contract vulnerabilities, oracle manipulation, and network outages, this has so far prompted most institutions to rely on private blockchains. While private blockchains are likely to continue to grow alongside public permissionless chains, this could lead to liquidity fragmentation due to interoperability barriers, which will make it more difficult to realize the full benefits of tokenization.

An important topic to watch around tokenization is the regulatory progress made in jurisdictions such as Singapore, the European Union, and the United Kingdom. The Monetary Authority of Singapore (MAS) sponsored "Project Guardian", which has developed dozens of proof-of-concept tokenization projects on public and private blockchains of global tier-1 financial institutions. The EU DLT pilot regime sets out a framework that enables multilateral trading facilities to leverage blockchain for trade execution and settlement, rather than through a central securities depository. The UK has also launched a pilot system seeking a more advanced framework for issuing tokenized assets on public networks.

While many are now looking for a "proof of concept" for possible commercialization, we still expect full implementation to continue for many years, as the topic requires regulatory harmonization, progress on on-chain identity solutions, and scaling of critical infrastructure within key institutions.

Can we play the game?

After a sharp drop in trading activity in the early stages of the recent crypto winter, interest in Web3 gaming has rekindled in 2H23. Currently, the space is primarily focused on attracting the attention of many mainstream gamers outside of the "crypto-first" community. Overall, the gaming industry currently has a total addressable market of around US$250B, which is expected to grow to $390B over the next five years. [9] However, despite the potentially huge investment opportunities, users generally reject the existing web3 "play-to-earn" model, which is represented by early-stage projects such as Axie Infinity. In fact, such models can lead to greater skepticism about web3 integration among many mainstream gamers.

This has prompted developers to experiment more with the network effects of high-quality AAA games with sustainable financialization mechanisms. For example, game studios are already considering minting web3 primitives, such as non-fungible tokens (NFTs) that can be used, transferred, or sold in games or on designated marketplaces. However, surveys have shown that the vast majority of gamers don't like NFTs, which largely reflects their rejection of the "play-to-earn" or "pay-to-play" ethos. [10] At the same time, the added value of leveraging web3 architecture for the gaming industry lies in the promise of improved user acquisition and retention, but so far this remains an unsubstantiated argument. With the game development process for many projects reaching the standard of 2-3 years (following the massive fundraising in 2021-2022), we think that some of the web3 games that may be released in 2024 may soon provide us with the stats and data we need for better development. Evaluate the sector.

How to build a decentralized future

A big theme in 2024 (most likely longer, depending on the development timeframe) is the decentralization of real-world resources. We pay special attention to the concepts related to the Decentralized Physical Infrastructure Network (DePIN) and Decentralized Computing (DeComp). Both DePIN and DeComp utilize token incentives to drive the creation and consumption of real-world constructed resources. In the case of DePIN, these projects rely on creating economic models that help incentivize participants to build physical infrastructure (from energy and telecommunications networks to data storage and mobile sensors) that are not controlled by large corporations or centralized entities. Examples include Akash, Helium, Hivemapper, and Render.

DeComp is a specific extension of DePIN that relies on a distributed network of computers to fulfill a specific task. The concept has been reinvigorated with the mainstream adoption of generative artificial intelligence (AI). The computational cost of training AI models can be high, and the industry is exploring opportunities to adopt decentralized solutions to alleviate this problem. It's unclear whether the ability to express AI topics in the blockchain is viable, but the industry is growing. For example, a separate but related area of research called zero-knowledge machine Xi (ZKML) focuses on privacy and promises to revolutionize the way AI systems handle sensitive information. [11] ZKML may enable large language models to learn Xi from a set of private data without having to access that data directly.

DePIN represents a powerful real-world use case for blockchain technology that has the potential to disrupt existing paradigms, but it remains relatively immature and faces many obstacles. These include high initial expenditures, technical complexity, quality control, and economies of scale, among others. In addition, many DePIN projects have been focused on how to motivate participants to provide the necessary hardware for these projects, but only a few have begun to address the financialization model that drives demand. Although the value of DePIN may be apparent sooner, it may still take years to realize its benefits. As such, we believe market participants still need to take a long-term view to invest in the sector.

Decentralized identity

Privacy is a new frontier for blockchain developers, who are leveraging innovations such as zero-knowledge (ZK) fraud proofs and fully homomorphic encryption (FHE) to enable computation on user data while still keeping it encrypted. Its applications are very widespread, especially when it comes to decentralized identity – it describes the end state in which users have full control and ownership of their personal data. For example, this can enable healthcare research organizations to analyze patient data to help them spot new trends or patterns in specific diseases, but without revealing any of the patient's sensitive health information. However, in order to achieve this, we believe that individuals need to be in control of their own identity data – which is contrary to the current status quo where this information is housed on the servers of many different centralized entities.

To be sure, we are still in the early stages of solving this problem. But the ZK system and FHE, once considered purely theoretical concepts, have recently seen more experimental implementations in the crypto industry. Over the next few years, we expect to see even greater progress in this area, which may lead us to achieve end-to-end encryption in web3 applications and networks. If so, then we believe decentralized identity is likely to have a strong product-market fit in the future.

Topic 4: The Future of Blockchain

Better user experience

One of the big themes that has emerged in recent bear market cycles has been the focus on how to make crypto more user-friendly and easy to use. The additional responsibility of managing cryptocurrencies and all related stuff (wallets, private keys, gas fees, etc.) isn't for everyone, making it difficult for the industry to mature unless it can overcome some key challenges related to user experience. Progress around account abstraction seems to be yielding meaningful results in this regard. The concept of account abstraction, which dates back to at least 2016, refers to the idea of doing similar things to externally owned accounts (such as wallets) and smart contract accounts, thereby simplifying the user experience. With the introduction of the ERC-4337 standard, Ethereum achieved advanced account abstraction in March 2023, opening up new opportunities for users.

For example, in the case of Ethereum, it could allow application owners to act as "payers" and pay users for gas, or enable users to fund transactions using non-ETH tokens. This feature is especially important for institutional entities that do not want to hold gas tokens on their balance sheet due to price fluctuations or other reasons. This was highlighted in the JPMorgan proof-of-concept report as part of Project Guardian, where all gas fee payments are processed through Biconomy's Paymaster service. [12]

Since the Dencun upgrade is likely to reduce rollup transaction fees by a factor of 2-10, we believe that more decentralized applications (dapps) are likely to pursue a "no gas transaction" path, effectively allowing users to focus solely on advanced interactions. [13] This may also facilitate the development of new non-financial use cases. Account abstraction can also facilitate a robust wallet recovery mechanism to create failsafe against simple human errors, such as losing a private key. The goal of the crypto ecosystem is to attract new users and encourage existing users to become more active participants.

Validator middleware and customizability

Developments such as restaking and distributed validator technology (DVT) enable validators to customize key parameters in new ways to better adapt to changing economic conditions, network needs, and other preferences over time. From an innovation perspective, the growth of validator middleware solutions has become a big theme in 2023, but we believe that their full potential to enhance customizability and unlock new business models has yet to be fully realized.

As far as restaking is concerned, it is currently pioneered by EigenLayer, and it could be a way for validators to secure data availability layers, oracles, sequencers, consensus networks, and other services on Ethereum. The potential rewards earned from this process could lead to a new revenue stream for validators in the form of "security-as-a-service". EigenLayer officially launched its first phase on the Ethereum mainnet in June 2023 and will begin registering active verification services (AVS) for operators in 2024, after which retryers will be able to delegate their staking locations to these operators. [14] We think these developments are worth keeping an eye on, looking at what percentage of staked ETH will be allocated to additional security terms when EigenLayer is fully available to the public.

At the same time, distributed validator technology (DVT) for proof-of-stake networks can provide stakeholders with more design options for setting up and managing validator operations. DVT decentralizes the responsibilities (and private keys) of a single validator to multiple node operators, limiting a single point of failure. [15] This reduces the risk of large penalties and enhances security, as compromised individual node operators do not result in compromised validators as a whole. Additionally, for solo stakers, DVT enables participants to run validators and earn rewards without having to provide much collateral (assuming they partner with others to meet staking thresholds through platforms such as Obol, SSV Network, or Diva Protocol), lowering the barrier to entry and facilitating greater decentralization. [16] As a result, we may see DVT enabling validators to be geographically distributed to mitigate activity and cut risk.

1. 见 DefiLlama. .

2. See Coinbase Cloud. , released on August 21, 2023.

3. See cLabs. , released on July 15, 2023.

4. See Bloomberg, posted on March 30, 2023, and Reuters, posted on October 17, 2023.

5. See BIS. , released in August 2023.

6. See IMF. .

7. See Coinbase Research. , released on March 9, 2023.

8. See Coinbase Research. , released on October 30, 2023.

9. 见 Statista Market Insights. .

10. See FandomSpot. published on March 21, 2022.

11. See WorldCoin. , released on February 22, 2023.

12. See J.P. Morgan. , released November 2023.

13. As part of Ethereum Improvement Proposal (EIP) 4844, Proto-Danksharding not only reduces the cost of putting rollup data on Layer 1 mainnet, but EIP-1153 also optimizes the network's gas fees.

14. See EigenLayer Blog. , released on November 16, 2023.

15. See Ethereum.org. , released on June 1, 2023.

16. Note: Coinbase Ventures is an investor in Obol and SSV Network.