Five crypto market predictions that haven’t come true — yet

Success in crypto trading often hinges on a deep understanding of fundamentals, sharp technical analysis skills, or access to market intelligence.

However, the driving force behind price movement frequently comes down to market narratives.

These stories about the market may or may not be fundamentally sound, but respecting them is crucial for success in crypto investing. 

There’s also a catch: narratives often emerge with force but can just as quickly fade away.

In 2024, several crypto narratives have taken center stage. 

Memecoins are one of the most peculiar trends, thriving on hype, humor and strong online communities despite lacking intrinsic value or any real utility. These tokens often attract quick-profit seekers, but their longevity remains in question.

More serious narratives, such as the growth of decentralized physical infrastructure networks (DePINs) and real-world asset (RWA) tokenization — both of which aim to solve actual problems — have also appeared.

DePINs focus on decentralizing infrastructure like energy grids using blockchain, while RWA tokenization refers to tokenizing assets like real estate and commodities. Experts predict tokenized RWAs could unlock a $30 trillion market, although that is yet to materialize.

The dominant narrative is the approval of spot Bitcoin (BTC) and Ether (ETH) exchange-traded funds (ETFs).

The ETFs provide a bridge between traditional finance and crypto, encouraging institutional adoption and legitimizing the market. BlackRock’s Bitcoin ETF alone has acquired over $20 billion in BTC, fueling optimism and market growth.

As these narratives evolve, the past shows that many trends tend to fade away or fall short of expectations, and Cointelegraph has taken a look at five major market narratives that have yet to pan out.

Lightning Network will make Bitcoin a viable currency for payments

In the 2008 Bitcoin white paper, Satoshi Nakamoto created Bitcoin to be a digital currency independent of central banks and institutions:

“A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.”

One big headwind hampering Bitcoin’s use as a payment currency is the network’s slow transaction speeds.

Visa can handle 24,000 transactions per second (TPS), Mastercard can perform 5,000, and Bitcoin can currently handle a maximum of seven. The dramatic differences between these digital payment platforms prove that Bitcoin should find a solution to its transaction speeds to become a viable payment currency. 

The Lightning Network (LN) is one such solution.

Lightning is a layer-2 protocol developed on the Bitcoin blockchain that can process payments in a parallel, faster, lighter network to remove traffic from the main blockchain. Theoretically, the LN can send 1,000,000 TPS and settle all of them instantly.

Lightning adoption has grown as its number of nodes has increased, and crypto exchanges have adopted the technology. Expectations for Lightning to make Bitcoin a viable payment currency were high, but it hasn’t yet lived up to its hype.

Lightning has encountered challenges related to privacy concerns and issues with network liquidity, which add an extra layer of technical complexity to using cryptocurrencies and hinder global adoption. 

The L2 solution hasn’t failed but needs improvement to handle payments worldwide. 

Blockchain is the solution to everything

“Put it on a blockchain” has long been a term in the business world for hyping something up without providing any real benefits.

The 2017 crypto bull run and initial coin offering boom introduced cryptocurrencies to the broader public.

Blockchain was rapidly promoted as a technology that could solve the issues of any business sector. 

Blockchain would improve global distribution systems, eliminate governmental corruption, tamper-proof elections, provide digital identity, establish intellectual property rights — and the list goes on. 

During the 2017 crypto bull run, blockchain became a buzzword as businesses tried to use versions of the technology to improve sectors or to attract attention. 

Projects such as PetChain, which used blockchain to track household pets, and Dentacoin, which aimed to create a decentralized ecosystem to improve different aspects of dental care, were some of the more unusual use cases for blockchain.

🇺🇬 Today we give a warm welcome to our third partner clinic in Uganda - Wana Dental Clinic and its owner Dr. Alex Ndikumwami. The team's mission at the clinic is to bring back healthy smiles to patients and to assure a better social life for more people. https://t.co/BXa06JEEZa pic.twitter.com/45wfQQ5nzG

— Dentacoin (@dentacoin) June 2, 2022

The hype surrounding blockchain overshadowed its benefits, leading to many projects that often lacked real-world utility. As the dust settled, it became clear that blockchain can address specific challenges, but not every problem requires a blockchain solution.

NFT dream of digital ownership

Non-fungible tokens surged in January 2021, receiving mainstream attention in March 2021, when crypto entrepreneur Sina Estavi purchased Twitter co-founder Jack Dorsey’s first tweet as an NFT for $2.9 million. Currently, the best offer for this NFT is just over $2,000 or 0.8 Ether (ETH) at current prices, according to OpenSea.

NFTs provided the technical possibility of proving ownership over digital content. This was revolutionary, as it could transform several sectors and create a marketplace for gaming assets and digital collectibles.

NFTs purported to solve a problem for digital artists who could have their artwork easily duplicated or stolen. The token would offer proof of ownership, and the artwork would be included in its minting.

The emergence of a new digital market produced one of the craziest hype cycles in the history of crypto, where buyers bought into a craze to be the first holders of certain NFTs. 

Millions of dollars went into NFT collections and computer-generated profile picture (PFP) collections, with only slight differences. The madness peaked, but nowadays, NFTs are being sold for heavy losses. 

The reasons for the downfall of NFTs could be related to the use of NFTs for wash trading, the lack of copyright protections provided, and the numerous scams that tarnished their public image, eventually scaring off investors.

Despite the mainstream public associating NFTs with monkey profile pictures, they still offer many potential real-world use cases. 

In real estate, they could track historical ownership, while in academics, they can enable immutable certificate verification. Anti-forgery systems for the ticketing sector and new approaches to digital identity and reputation management could be developed through NFT variations like soulbond tokens proposed by Ethereum co-founder Vitalik Buterin.

These applications will only be implemented if NFTs achieve legal backing or widespread acceptance from markets and consumers.

The metaverse will provide a new frontier for social interactions

In 1985, Lucasfilm’s Habitat — a video game for the Commodore 64 — provided the first example of a virtual cyberspace where users could interact.

Seven years later, in 1992, Neal Stephenson coined the term “metaverse” in his novel Snow Crash.

In the 1990s, the metaverse appeared poised to become a reality with the emergence of virtual reality (VR) headsets, heralded as a technological revolution. However, the market was overhyped and didn’t gain mainstream traction, mainly due to technological limitations. 

However, recent advancements in augmented reality (AR), VR headsets and faster internet bandwidth reignited interest in the metaverse.

The big moment came when Mark Zuckerberg announced Facebook’s rebranding to Meta and promised a commitment to investing and developing the metaverse.

The metaverse’s crypto narrative revolves around creating a decentralized, immersive digital universe where users can interact, create and transact in a virtual space. Blockchain and cryptocurrencies offered the possibility of enabling true digital ownership and interoperability, as well as potentially developing new digital economic systems.

Like the NFT craze, a flood of money went into metaverse projects using blockchain. Virtual real estate was sold for astronomical amounts of money, such as the 116 digital “land” parcels sold for $2.4 million.

However, the sudden rush into leading metaverse platforms like The Sandbox and Decentraland was short-lived.

Despite raising millions, DappRadar data indicates that Decentraland has around 300 daily active users, while The Sandbox has about 200.

The metaverse investment hype may have arrived too early. An underdeveloped product failed to meet gameplay expectations and ultimately bored users. Meta lost $16 billion in 2023 and continues to lose money on its metaverse investments. With new technological enhancements, a profitable and active metaverse could yet emerge — only time will tell. 

Privacy coins will catch on as people want to transact privately

Contrary to popular belief, cryptocurrencies do not inherently provide total anonymity. Most operate on a public blockchain, which offers pseudonymity at best — privacy coins aimed to fix this. 

Leading privacy coins such as Monero (XMR) and Zcash (ZEC) were created to preserve anonymity in financial transactions and ensure financial privacy. 

These coins surged in the 2017 bull run and made a comeback in 2021. As regulators fixed their eyes on privacy coins, there was renewed interest in them.

However, it looks like regulatory forces are winning the battle so far. 

Privacy coins have been stigmatized due to constant regulatory pressure over their association with illicit activities such as money laundering and tax evasion. 

Despite the price surges in 2017 and 202, many exchanges began to delist privacy coins in 2022 to avoid regulatory backlash as pressure mounted, severely limited liquidity and accessibility.

Law enforcement capabilities have also evolved with the improvement of advanced forensic tools and blockchain analytics firms that can track certain transactions. Although Monero wasn’t cracked, the fact that other privacy coins could be tracked weakened their selling point of being completely untraceable.

Furthermore, most common crypto users feel safe enough with the pseudonymity offered by mainstream cryptocurrencies like Bitcoin or Ether, with proposals for them to become more private, reducing the appeal of niche privacy coins.