Top 7 Trends in Blockchain Technology to Watch Out for in 2022
The current trends in blockchain technology and the fan-following it is getting, are true indicators of a higher rise in its uses in the future. There are predictions that blockchain will be used to make the various processes like supply chain, order management, vaccination administration, etc., much more transparent and easy to track. In addition to this, NFTs, which is another special use case of blockchain, are likely to occupy a wider space in a range of industries. Blockchain technology can possibly exhibit more such advanced trends in the year 2022. So, here we are discussing the potential trends in blockchain technology that we can witness this year.
Integration of Blockchain with IoT
Currently, companies dealing in IoT and its products are facing problems regarding the scalability and security of their products. As the IoT networks are completely centralized, meaning they are governed by a cloud-based network, it poses a great threat of security breaches. A single point of failure can lead to the entire IoT setup crashing down. In addition, the cloud-based approach feature of IoT exposes scalability problems.
So, the companies are thinking of integrating IoT with blockchain to solve the problems of security and scalability. Since blockchains are decentralized and completely controlled by smart contracts, there are very less chances of security breaches until the smart contracts have issues in their code itself. At present, there are blockchain projects like IOTA that are working to integrate two of the most revolutionary technologies in the world, the blockchain, and IoT.
Greener Initiatives in the Blockchain Technology
All of us are aware of the energy-extensive nature of blockchain technology. In the beginning, there may not be much concern about the carbon dioxide generated by blockchains and cryptocurrencies. However, as newer blockchain projects are emerging in the world and contributing to a bigger carbon footprint on the Earth, the companies are striving to create greener solutions. Ethereum, the second-largest blockchain project, is planning to switch over to the Proof of Stake consensus mechanism from Proof of Work. PoS is a sustainable alternative to the mining of cryptocurrencies in contrast to PoW in which an abundant amount of energy goes into mining a single coin and validating just one set of transactions.
Broader View of the Metaverse: Trends in Blockchain Technology
At present, Metaverse, which represents a whole new experience in the virtual reality and gaming world, is still not very clearly defined. A lot of companies are exploring the concept from their perspectives and their potential use cases. However, there is no clarity about the problems Metaverse will solve or the common approach toward Metaverse that the companies can take. Even big companies like Meta, previously known as Facebook, changed their name in the pursuit of stepping into the virtual world. Therefore, in 2022, more companies adopting the concept and putting Metaverse to practical use is one of the trends in blockchain technology that people should definitely look out for.
The emergence of Central Bank Digital Currencies
With a worldwide pandemic still somewhat in place, the use of cash is rapidly declining. Instead of cash, people are largely turning towards the digital modes of payments to pay for offline and online goods and services. Also, keeping in mind, the large-scale adoption of digital currencies because of the centralized nature of traditional currencies, central banks of various countries are conducting pilot projects to introduce their own digital currencies.
There are news flashes that predict the introduction of digital currency, e-CNY by China. e-CNY will be used to pay for online and offline goods, government services, highway tolls, transportation costs, utility bills, etc. In addition, there are strong predictions for other big countries like Russia, the United Kingdom, and Japan to introduce their own central bank digital currencies in the year 2022. If it happens, this can be a very significant trend in blockchain technology that can influence the world to a great extent.
More Practical Application of Blockchain
As far as we know, blockchain technology is currently being used to mine cryptocurrencies, create virtual reality platforms, and mint NFTs. Apart from that, there are some blockchain projects like VeChain, that is bringing together the concept of blockchain to make the supply chain much more transparent. However, at present, there are very less blockchain projects that are offering much more practical applications outside the crypto world. Therefore, we can predict that a wider and more practical application can be one of the greatest trends in blockchain technology.
A Wider Adoption for Non-fungible Tokens
Non-fungible tokens were first introduced when the first-ever tweet made on Twitter was minted as an NFT and sold for millions. Though there was no practical use in doing so, NFTs expose a large area of utility that can be achieved by using NFTs. If for some, NFTs have been a way to immortalize their love and marriage, then for others, they have presented the best way to retain the ownership of an original work of art for artists and musicians. In addition, the existence of NFTs has eased the otherwise long and tedious processes that involved third parties besides the two participating parties. The combination of NFTs and smart contracts has accelerated the processes related to real estate, industries, and other contractual partnerships.
This clearly shows that NFTs are going to expand their use cases in the year 2022. As more artists become aware of NFTs and the easy ways of earning money through pre-owned NFTs, there is a strong likelihood of more people becoming aware of them and using them to prove the ownership of their work.
Blockchains will Occupy More Industries
As of now, blockchain and its applications are being used in the field of supply chain management, digital payments, etc. But in 2022, we may witness a variety of industries such as banking and finance, governmental operations like voting, vaccination distribution, insurance, social media, education and so on. So, we strongly recommend you keep a watch on these trends in blockchain technology that may be knocking on your door in 2022.
Conclusion: Trends in Blockchain Technology
With an expanded adoption of blockchain in different industries, the processes are going to become automated and free from human interventions. While this looks promising as it will eliminate the risks of human errors and will save time, there is an equal number of risks involved in such a setup. Therefore, the users must stay aware of the risks and take preventive measures.
A passionate writer, seasonal poet, and feminist, I am trying to wrap my head around all the topics under the sky. You can often see me talking about crypto, social issues, traveling across the globe, how I am trying to change the world, and how you can be my ally!