TheBlockResearch：2022 key developments and 2023 trends in the cryptocurrency industry

The Block Research presents the 2023 Digital Asset Outlook Report today, providing a granular look at the most significant developments in cryptocurrency in 2022 and highlights several key trends to watch over in 2023. 

The 199-page report covers 10 sectors within the cryptocurrency industry:

1. State of the general market
2. BTC and ETH mining market
3. Investment trends
4. Layer-1 platforms
5. Blockchain scaling solutions and bridges
6. Decentralized finance (DeFi)
7. Web3 infrastructure
8. NFT landscape
9. Web3 Gaming and Metaverse
10. Macroeconomics

There are 10 Key Highlights:

• Market performance: All top ten cryptocurrencies (BTC, ETH, BNB, XRP, DOGE, ADA, MATIC, DOT, OKB, and LTC) by market capitalization experienced negative price returns as low as 81%.
• Mining: As bitcoin’s price dropped more than half throughout 2022, many miners faced increasing financial distress. Core Scientific stated it would consider bankruptcy if its financial situation did not improve. 
• Investment trends: The number of funding deals increased 18% year-on-year, and the NFTs/Gaming vertical attracted the most funding this year at $8.3 billion. Nevertheless, there are indications of a slowdown as the overall growth of funding decelerates compared to the previous year.
• Crypto hires: Number of employments in the digital asset industry jumped over 351% to 82,248 from 18,200 in 2019. Yet, the number of layoffs peaked in 2022 at 9,564, with Crypto.com laying off the most employees, contributing 24% to the total attrition, followed by Coinbase, Kraken and Bybit, each contributed ~6%. 
• Layer-1 networks: As developers work towards abstracting blockchain complexities, 2022 saw an emergence of application-focused chains, such as Cosmos ecosystem, Avalanche subnets, and Polkadot’s parachains.
• Layer-2 solutions: Optimistic rollups are currently dominating Ethereum-based rollups. It remains to be seen whether it can maintain its position as rollup space becomes increasingly competitive, with Celestia set to launch next year.
• Decentralized Finance (DeFi): DeFi space experienced a contraction in 2022. Value locked in DeFi decreased 74.6% from $166 billion to $42.1 billion. Terra’s ecosystem collapse in May marked the most drastic crash in value locked. 
• Non-fungible tokens (NFTs): 2022 had been a seminal year for NFTs, with Solana becoming the second home for NFTs, a heated debate over creator royalties, Yuga Labs’ ecosystem expansion, a war on IPs, storytelling NFTs, and much more.
• Web3 Games: Web3 games have not proven market-proof as they suffered from user retention and token price crashes. They have also undergone unsuccessful rebrand attempts from play-to-earn to play-and-earn, play-to-own, and free-to-own. We believe that Web3 games in 2023 will focus more on game launchers, wallets, and on-chain games.
• Metaverse: Web3 Metaverse struggled to find the right product-market fit in 2022, and it will continue in 2023. That said, we are looking at The Sandbox, which may do a full launch in 2023 and change the trend.