The aftermath of the crisis initiated by the collapse of major players in the market generated declines, but not enough to dissolve it. The price of the main cryptocurrencies started an upward movement and everything indicates that the consequences seen recently have already been priced in.
Caution must be maintained, mainly due to factors that go beyond the crypto universe, such as the recession and high inflation in the world, but there is no lack of reason to be excited about the long term. Let's talk about some of the technologies and news that we've been optimistic about lately and that should arrive very soon.
What we have seen most during this period with the shrinking market is the development and structuring of projects. Although the most apparent discussions in the headlines may give the impression that we are living in a very negative phase, the truth is that the blockchain universe is in full expansion and evolution.
Disruptive technologies with immense potential for transformation are at an advanced stage of development and should arrive soon to once again expand the reach and importance of blockchains. Below we will discuss some of them and give an overview of how much they can impact cryptocurrencies.
Advances for mobile devices
Cell phones were the turning point for the internet to acquire a central role in our lives. If it weren't for the possibility of using it almost without limits on mobile devices, we wouldn't be where we are today in terms of the digitalization of life. And we're counting on cell phones to have that same impact on blockchains.
A major obstacle for blockchain to finally reach cell phones is the fact that they work from centralized networks and platforms. To try to change that, protocols like Kevlar, Nimbus and Helios offer alternative versions of lighter clients, which allow users an experience similar to running their own nodes.
In addition, the Saga, a smartphone developed exclusively for the Solana network, is about to hit the market. These novelties, combined with the constant improvement of applications and platforms to adapt to mobile devices, indicate that it is very likely that we will see a great leap in the quality and scope of blockchain access from mobile devices as early as 2023.
Zero-knowledge systems
Privacy and security are two of the main concerns of anyone investing in crypto assets. When interacting with platforms and applications, we don't like to expose ourselves and provide data. Having sensitive information held by third parties to use simple services is an annoying inconvenience, and it can also be dangerous. That's why Zero-knowledge systems are so important.
They offer the possibility of proving the veracity of a certain statement without the need to provide any material proof, or to explain how that information was confirmed. The prover (who wants to prove something) can confirm a certain statement to the verifier (who questions a certain fact) without having to provide extensive evidence.
How can they be used
Imagine, for example, that you want to prove that you are a citizen of a certain country but you don't want to provide any additional data, such as certificates and personal documents. With the use of a Zero-Knowledge system this is possible. They use an algorithm to confirm information between two parties.
Zero-knowledge systems have the most diverse applications and have been around since 1985. But in the blockchain universe, they can be disruptive. For now, its use still requires a large computational capacity, which also translates into high cost in fees.
Furthermore, they are relatively fragile when considering the possibility of using quantum computers to break cryptographic codes. But that may be about to change as other technologies develop in parallel.
Secure Multiparty Computing
Secure Multiparty Computing is a technology that allows you to divide a given computational task into multiple parts, without one being aware of the information sent to the others. This makes it possible to solve equations much faster and more efficiently.
This type of computation also makes processes safer, as it prevents the complete set of information from being accessed by malicious agents who manage to break the security of one of the parties. We believe that, as this technology develops, we can reduce the costs and time needed to overcome computational barriers in the use of more complex resources.
Post-quantum cryptography
The development of technologies is not restricted only to the crypto universe. Quantum computers, more powerful and efficient, are being built in several companies. They have the ability to solve extremely complex equations, including the consensus and encryption algorithms of some blockchain applications.
But don't worry, they are not a threat yet. The hashing technology used in blockchains, for example, is considered safe from this type of attack. In addition, several professionals and companies are dedicated to creating more complex cryptography, which even surpasses the computational capacity of quantum computers.
The NIST (National Institute of Standards and Technology), an American entity similar to INMETRO, is already homologating and standardizing forms of post-quantum cryptography for use by industry in general. This should put us one step ahead of bad actors and ensure the security of the cryptocurrency market for a long time to come.
Zero-knowledge development
Although the technology is relatively old in theory, it only started to be put into practice a few years ago and we already have great achievements. Among them is the creation of languages such as NOIR and LEO, which allow programmers to develop solutions using the ZK system.
It is expected that this advance will lead to the creation of several projects and platforms with ZK resources. This should lead to a significant increase in the security, convenience and reliability of online transactions, especially involving crypto assets.
Verifiable Delay Functions
Verifiable Delay Functions are very similar to the Proof of Work mechanism, but they have an interesting difference. While in the PoW functions the calculations happen in parallel, in the VDF model there is a certain linear order that necessarily needs to be obeyed.
This makes it an excellent option for lottery applications using blockchain, for example. Such a mechanism could enable the creation of new applications in which randomness would be guaranteed, in a much safer and more reliable way than that offered by the tools we have so far.
The big challenge for its implementation was linked to the fact that it requires a very large computational effort. But the technologies we saw earlier can be great allies to enable a breakthrough in the use of VFD. This could add a lot to the crypto market later this year.
Autonomous and decentralized metaverses
One of the most exciting technologies being developed is metaverses. We know how much electronic games have evolved in recent years, with worlds that are very complete and rich in detail in which players can spend hours, months and even years exploring, without ever running out of possibilities.
Imagine then what we will have when a game is developed whose metaverse is allocated on-chain, which is autonomous and cannot be censored or changed by any centralized entity. Perhaps we are close to seeing that happen. The possibility of something like this being created increases every day and we already have all the necessary resources to do so.
Non-Transferable Tokens
While not disruptive, non-transferable tokens (or SBT - Soul Bound Tokens) have gained a much more interesting perspective recently. They are exactly what their name suggests, non-walletable tokens. Its main use cases are related to decentralized identifications.
But in the context of the web3 they can have several use cases, such as: proving who owns an NFT, DeFi loans, resistance to sybil attacks, academic certificates, among others. Associated with other technologies, they can play a very significant role in our digital presence in the coming years. They can be used to build reputation, for example. Innovative use-case proposals should be coming soon, and we're looking forward to finding out what else can be done with them.
Decentralized energy
Energy is fundamental to the development of the entire blockchain universe. The entire chain is very dependent on the availability and feasibility of using electricity. Therefore, finding decentralized solutions for energy production and distribution is essential for the entire chain to be free of interference from centralized entities.
With that in mind, there are already interesting projects, both for funding research and development of new technologies, and for digitizing the resources we already have. An interesting case is the tokenization of carbon credits, which is already being applied in some countries.
In addition, Carbon Credit Certificates can also be tokenized and traded as digital assets, making it much easier to trade energy resources. This evolution in the way we consume energy could be a game changer for the blockchain universe, as it is still a major bottleneck in realizing its potential.