In terms of the entire cryptocurrency market, 2021 was a particularly explosive year. Additionally, the year was filled with a lot of plot changes as well as various metagames.
In light of this, as the year draws to a close, we’d like to highlight five of the most influential trends from the past 12 months. Despite their different achievements, all of them excelled in specific areas.
Let’s get started, shall we?
Memecoins
The memecoins took the center stage – on several occasions – in 2021 despite some arguing they made their debut in 2020 during the so-called DeFi summer.
Although memecoins appeared to be driven by a central force, unlike other trends. As the CEO of Tesla and TIME’s Person of the Year, Elon Musk single-handedly brought enormous attention to what’s widely regarded as the king of memecoins – the Dogecoin.
Source: CryptoPotato archives
Dogecoin (DOGE) could have started out as a joke years ago, but today it has one of the strongest communities, hundreds of thousands of HODLers, and is one of the world’s leading cryptocurrency projects. In addition, since Musk appears to support DOGE, at some point Tesla will accept it for some of its products.
At the time of this writing, the cryptocurrency is up almost 4,000%, though it is trading at 76% below its all-time high reached in May.
The increase in value of Dogecoin was much more than just a rise in value. In the months following, the market was flooded with memecoins that were alarmingly similar in their functionality.
Shiba Inu’s SHIB token is a striking example. It has been reported that people invested as little as $100 a year ago and became millionaires using this self-proclaimed “Dogecoin killer”. Right now, SHIB is up 44,636,200% over its all-time high, despite being 60% below its peak.
Moreover, memecoins have become household names and viable market-placement strategies. A clear product-market fit was evident in the rise of Doge and Shiba, as well as other coins Various teams started naming themselves after popular dog breeds and developed what many regarded as legitimate business platforms.
Unsurprisingly, everyone takes memes ironically, unironically.
Non-Fungible Tokens (NFTs)
Since quite some time now, non-fungible tokens have dominated the cryptocurrency industry. A lot of newcomers to the field have also been attracted by this trend.
Perhaps this is because the average Joe does not associate NFTs with complex economic models and attempts to disrupt monetary policies. The majority of people don’t know what NFTs are – they are just interesting and scarce representations of digital art.
Where else can you find an 8 million dollar digital drawing that can be right-clicked and saved as a JPEG?
One of nine Alien CryptoPunks. Sold for $8 million.
Of course, it’s not as simple as that – NFTs carry the digital signature of the artist and can’t possibly be reproduced, making them essentially unique unless they’ve been reproduced in multitudes.
Beeple’s The First 5,000 Days is perhaps the most impactful story on NFTs. In total, Mike Winkelmann (a.k.a. Beeple) produced 5,000 pieces of digital art over a period of 5,000 days. Christie’s auction house sold the piece for $69 million, making him one of the world’s three most valuable artists.
Several hundred NFTs are available on the Internet, from Crypto Punks, Rocks, Bored Apes Yacht Club, Rumble Kongs, and Hashmass to literally written numbers on white backgrounds. The most interesting part is that this trend doesn’t appear to be slowing down. Even though retailers are less interested in NFTs, it’s also important to note that they’re the backbone of our next discussion point – the metaverse and the play-to-earn model.
Play-to-Earn (P2E)
Blockchain and online gaming are two fields, touted to go hand-in-hand for quite some time. Throughout the past few years, we saw a few games that were underpinned by distributed ledger technology, but up until this point, nothing really took off.
Source: CryptoPotato archives
Well, this all changed in 2021, and especially in late Q3 and Q4. It was no other than Axie Infinity that led the march throughout the year. One of its native tokens – AXS – increased from roughly around $0.5 and reached an all-time high of $160 in November. At the time of this writing, the token is up almost 17,000% in the past 12 months alone, despite trading well below its ATH. Moreover, a plot of land in Axie Infinity’s universe sold for $2.3 million not so long ago.
The entire P2E genre, though, took off after Facebook revealed that it would rebrand to Meta and become an active player in building the metaverse. Once that happened, it was on. The play-to-earn field took off and is still raging at the time of this writing.
Projects such as The Sandbox and Decentraland cracked well into the top 50, and the latter even surpassed Axie Infinity as the biggest gaming project.
Now, it seems that the concept of the metaverse is all around us, and the hype is real. Hundreds of teams are racing to produce a blue-chip blockchain game that would win the player base and become an established leader. Maybe 2022 will see that happening, who knows?
Binance Smart Chain Mania
If last year we saw the DeFi summer on Ethereum, then this year we saw the same madness unravel on the Binance Smart Chain (BSC).
The demand for decentralized apps became so high that it literally clogged the Ethereum network. User-intensive processes increased the load to an extent where people had to pay hundreds of dollars in transaction fees, making it virtually impossible for smaller investors to participate in the field of decentralized finance (DeFi).
As the yield farming metagame was growing in popularity, though, alternatives started to pop up in aims of grabbing all those frustrated DeFi degens that were tired of paying big bucks on Ethereum.
This is how the Binance Smart Chain came to prominence. In the second week of February, the unique addresses on BSC tripled. In March, the count of transactions on PancakeSwap (the largest DEX on BSC) was higher than that on the entire Ethereum network for a span of a 24-hour period.
Source: BSCScan
In April, the total value locked in PancakeSwap reached $5.5 billion, temporarily surpassing the TVL in Uniswap.
All the projects that we saw being built on Ethereum were suddenly replicated by other teams on BSC, but, as history would go on to show, it was to no avail. The broad majority of them are currently way underwater as the hype around BSC slowly faded away. Even though the unique address count continues to grow, it’s nowhere near the temp it had back in that period.
It’s also worth mentioning that this entire trend is part of the reasons why Binance Coin (BNB) is up over 1200% in the past 12 months as well.
Laser Eyes: Bitcoin to $100K
Laser eyes are a Bitcoin-centered trend that also saw a lot of hype throughout the year. Basically, someone came up with the idea to put laser eyes on their Twitter profile picture and keep it that way until BTC’s price reaches $100,000.
A massive number of people, including MicroStrategy’s CEO Michael Saylor, US Senator Cynthia Lummis, and even our own potato, succumbed to the idea and thus participated in what appeared to be one of the biggest movements of the year.
The crypto community under the laser eyes. Source: Mike Dudas’ twitter
To this date, Michael Saylor has his Twitter profile picture carrying laser eyes, causing many to believe that he’s executing the highest conviction trade on Wall Street.
In any case, the trend was somewhat short-lived because soon after it started, the price of bitcoin crashed by roughly 50%, causing some to speculate that this particular hype was somewhat of a top signal.
Author
Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
