Word on the street seems to be that decentralisation is the key to the digital future. While the concept is considered to be restricted to cryptocurrencies, experts believe that the Internet will also be a face of it through Web3.0. 2023 is believed to be significant in terms of how Web3.0 developments panned out, which seemingly will set the tone for 2024. “In 2023, I think we witnessed a chapter in the evolution of Web3.0. Regulatory strides took centre stage, marking a shift from scepticism to frameworks and clarity. The narrative around crypto and blockchain has evolved, steering us away from the era of bans and towards embracing the potential of permissionless ecosystems. As we chart our course for 2024, emerging markets are poised to be hotbeds of blockchain adoption,” Nischal Shetty, co-founder, Shardeum, an EVM-based smart contract platform, told FE TransformX.
As far as numbers are concerned, the 2023 Web3.0 landscape clocked investments from venture capitalists. Media reports have shown that in September, 2023, total number of Web3.0 investments reached 118 deals, which totalled to $549 million. During that month, Scroll, a zkEVM Layer 2 for Ethereum (ETH), unveiled its mainnet which clocked roughly $900,000 worth of total value locked (TVL). Data provided in a report by Crunchbase, a business information-based company, stated that in Q2 of 2023, Web3.0 startups managed to secure $1.8 billion, in comparison to $7.5 billion in 2022. Reportedly, the first six months of 2023 saw total funding worth $3.6 billion, which stood at $16 billion for the same period of 2022. According to the official website of BNB Chain, a blockchain, the bear market implications didn’t impact the total count of smart contracts during the second quarter of 2023, especially for blockchains such as Avalanche, Ethereum, Polygon, Arbitrum, Optimism, and BNB Chain. It’s believed that the smart contract count for April-June, 2023, Avalanche’s increased from 2.2% to 2.7%, along with Ethereum’s increased from 31% to 34%, Polygon’s increased from 10.8% to around the 10-12% area, Arbitrum’s increased from 0.9% to 4.5%, Optimism’s increased from 1.2% to 1.5%, and BNB Chain’s increased from 38% to 45%. However, Fantom’s total number of smart contracts recorded a downward trend from 3.3% to 1.4%, during April-June, 2023.
“In India, despite the bear market, investors held onto their belief in crypto. I think the Web3.0 industry remained active in 2023, witnessing the launch of new projects, startups exploring use cases, and education and ecosystem initiatives. The focus on transparency and regulatory compliance was evident, with 28 entities in India becoming ‘FIU-Registered Reporting Entities.’ This commitment to transparency is expected to shape an accountable and resilient Web3.0 landscape. Throughout the year, industry players engaged with the government to address regulatory concerns and create a secure environment for Indian investors,” Sumit Gupta, co-founder, CoinDCX, a crypto investment application, highlighted.
As per Alchemy, a Web3.0 development platform, in 2023, the kinds of Web3.0 startups which secured funding have been are 26% for decentralised finance (DeFi) startups, 25% for developer tooling companies, 16% for account abstraction startups, 13% for infrastructure providers, 10% for zero-knowledge startups, and 10% for rollups-as-a-service (RaaS) platforms. Interestingly, the Web3.0 gaming sector has also seen its share of numbers for 2023. Research done by Game7, a Web3.0 gaming platform, showed that in Q3 of 2023, the Web3.0 gaming market clocked more than $800 million. DappRadar, a Web3.0 decentralised application (dApp) distribution platform, specified that the total number of daily unique active wallets (dUAW) reached one million for the Web3.0 gaming industry in 2023. In October, 2023, alone, the Web3.0 gaming industry was fueled by investments worth $154 million.
For 2024, the global revenue from Web3.0 gaming is anticipated to reach $29 billion, as per Zipdo, a meeting management platform. Data provided by Invezz, a financial data platform, mentioned that the international Web3.0 sector will clock $5.5 billion by 2030, at a 44.9% compound annual growth rate (CAGR) for 2023-30. “Looking ahead to 2024 and beyond, we hope that the government will build on the momentum from the publication of the IMF-FSB Synthesis paper, and take forward the work done during India’s G20 Presidency in Brazil’s presidency of the G20, and look at bringing domestic regulations for the sector. However, in the short term, we believe that measures to protect consumers in the Web3.0 space will be critical and hope the government will work with the private sector to increase awareness of the potential and risks associated with VDAs,” Dilip Chenoy, chairman, Bharat Web3 Association, a Web3.0 technology company, concluded.
