Top Crypto Narratives for 2024

Approaching 2024, AltcoinBuzz is zeroing in on the key storylines expected to dominate crypto discussions in the coming year. These narratives guide understanding ongoing developments, their reasons, and what lies ahead.

Staying up-to-date on these popular crypto narratives can position you for substantial gains, especially as we enter a bullish market. While experts anticipated some trends in 2023, many remained unpredictable. The truth is that the future of web3 remains uncertain.

Andreessen Horowitz, widely known as a16z, is a prominent American venture capital firm with a track record of supporting groundbreaking tech startups. Their influence in the VC arena significantly impacts markets and innovation. On December 7th, a16z unveiled a list of trends expected to shape the crypto industry in 2024.

The venture capital firm highlights artificial intelligence, crypto gaming, and modular technology as potential defining trends for the upcoming year. With a positive shift in crypto sentiment, many are keen on understanding the implications of a16z’s “big ideas” list. Let’s dive in!

What Trends Is a16z Keeping An Eye On For 2024?

A16z and its partners foresee many thrilling trends in fintech, bio, consumer tech, crypto, gaming, and infrastructure for investors to anticipate in 2024.

Within A16z crypto’s compilation of significant ideas, there is a noticeable emphasis on AI, gaming, and digital security. Notably, the 2024 list diverges from last year’s focus on “zero knowledge” technology, which dominated the first two points. The venture capital firm emphasizes the following:

1) Advancing Decentralization

a16z sheds light on the transformative potential of decentralization. Addressing the recurring issue of concentrated control in powerful systems or platforms. Miles Jennings, General Counsel & Head of Decentralization at a16z, emphasizes the critical role of decentralization in safeguarding user freedoms.

Essentially, decentralization fosters neutral and composable internet infrastructure, promotes competition and ecosystem diversity, and grants users greater choice and ownership.

However, despite decentralization’s acknowledged significance, implementing it at scale faces challenges compared to centralized systems’ efficiency. This challenge is particularly evident in web3 governance models, where decentralized autonomous organizations (DAOs) often rely on cumbersome structures rooted in direct democracy or corporate governance, falling short in addressing complex sociopolitical realities.

Nevertheless, the silver lining emerges from the “living laboratory” of web3, where experimentation has led to best practices for decentralization. These evolving models accommodate richer features, with some DAOs adopting Machiavellian principles for more effective governance. As these innovations evolve, the future promises unprecedented decentralized coordination, operational functionality, and groundbreaking innovations.

a) PartyDAO
  • It allows the creation of on-chain groups on the Ethereum.
  • Members engage in crowdfunding, on-chain voting, and collective execution of transactions.
  • Over 9,000 groups, 55,000 wallets, and 10,000 ETH in transaction volume.
  • Operates as a decentralized DAO known as PartyDAO.
  • Raised $16.4 million in financing led by a16z on June 10, 2022.
b) Fingerprints DAO
  • Focuses on digital art with a shared treasury and prized NFT collection.
  • Operates as a DAO, allowing users to join with 5,000 PRINTS Tokens or 1 Voxelglyph NFT.
  • Collaborated with Mercedes-Benz for the Maschine NFT.
  • Received funding from a16z in September 2021 (amount undisclosed).
2) Revamped UX

Eddy Lazzarin, a16z’s Chief Technology Officer, stresses the imperative for a fundamental user experience (UX) reset within the crypto space. Despite persistent complexities dating back to 2016, developers are pushing the boundaries to redefine the frontend experience in the upcoming year.

Current challenges in crypto UX, such as self-custodying secret keys and connecting wallets with dApps, have remained intricate. As such, there is a growing call for innovative solutions for the impracticality of expecting users to grasp these complexities within their initial interactions with a crypto app.

Undeniably, a wave of pioneering tools is poised to reshape the crypto UX landscape.

Passkeys offer a simplified approach to signing in across devices, with automatic cryptographic generation enhancing security. Smart accounts introduce programmability, while embedded wallets eliminate onboarding friction.

Meanwhile, multi-party computation (MPC) simplifies third-party support for signing, and advanced RPC endpoints enhance the user experience by recognizing preferences and filling functionality gaps.

These transformative tools contribute to mainstream web3 adoption and promise elevated UX standards beyond web2. As developers innovate, the future envisions a crypto UX that is more accessible, secure, and user-friendly.

a) Dynamic Labs
  • Multi-chain authentication and authorization platform
  • Features include embedded wallets, Crypto-Native logins, profiles, multi-chain wallets, etc.
  • Offers customizable turnkey service that hides web3 tech for novice and Web3-native users
  • Completed a financing round of $13.5 million on December 13, 2023, led by a16z and Founders Fund
b) Pimlico
  • Infrastructure platform for ERC-4337 smart accounts
  • Provides functionalities like validators, paymasters, and ERC-20 payments
  • Integrated with multi-sig contract Safe in November
  • Became one of the largest bundlers in ERC-4337 account abstraction
  • Completed seed funding round of $4.2 million on November 7, 2023, led by a16z, bringing total funding to $5.8 million
3. Ascendance of Modular Tech Stacks

In the domain of networks, the pervasive force of network effects holds sway. Modularity, a key element, is divided into two distinct types: one that reinforces network effects and the other that weakens them, with the former taking precedence in the open-source realm, relegating the latter to rare exceptions.

Traditionally, monolithic architectures led the way, providing deep integration and optimization, resulting in initial performance gains. However, the ascent of an open-source, modular tech stack signifies a paradigm shift, emphasizing the unlocking of permissionless innovation. It allows specialization and incentivizes heightened competition—an imperative in today’s dynamic landscape.

Ali Yahya, General Partner at a16z, advocates the adoption of open-source, modular tech stacks, emphasizing their unparalleled ability to stimulate permissionless innovation, enable specialization, and foster a competitive environment. Embracing this shift is crucial to cultivating a world where innovation knows no bounds.

a) Stackr Labs
  • Modular rollup SDK introducing micro-rollups for dApps
  • Enables development, optimization, and maintenance of offerings of dApps as independent state machines
  • Developing pre-built state machines and bridge modules for easier interactions
  • Applications include games, databases, cloud services, oracles, real-world data, and social algorithms
  • Completed a seed funding round of $5.5 million on November 9, 2023, led by Archetype
  • a16z CCS participated in the round, and the project got shortlisted for a16z Crypto Startup School 2023
b) Celestia
  • Modular blockchain with a focus on scalability, flexibility, and interoperability
  • Mainnet launched on October 31, 2023, facilitating use for data availability and consensus for rollups and other modular public chains
  • The data availability layer integrated with systems like Arbitrum Orbit and Polygon CDK
  • Completed funding round of $55 million on October 20, 2022, led by Bain Capital Crypto and Polychain Capital
4) Convergence of AI and Blockchains

Noteworthy figures, such as Stanford Professor Andy Hall, Data Scientist Daren Matsuoka, and General Partner Ali Yahya, highlight the transformative synergy between AI and decentralized blockchains. The conventional AI landscape, dominated by a few tech giants, faces challenges of computing power and training data accessibility.

However, decentralized blockchains emerge as a counterbalance, unlocking the potential for creating global, permissionless markets. In this innovative ecosystem, anyone can contribute and get compensated for providing compute resources or introducing new datasets, democratizing AI access, and reducing costs.

Furthermore, the implications of AI revolutionizing information production extend to society, culture, politics, and the economy. In response to challenges like deep fakes, crypto tech unveils the black box, allowing the tracking of online content origins and adding transparency.

Anyhow, the focus now shifts to decentralizing generative AI and ensuring democratic governance, preventing any single entity from holding disproportionate power. Web3 serves as the experimentation ground for these solutions, with decentralized, open-source crypto networks poised to democratize AI innovation and create a safer consumer environment.

a) Gensyn
  • Machine learning computation protocol
  • Unites global computing resources into a supercluster
  • Aims for cost reduction and trustless free access
  • Uses blockchain to decentralize computing resources and token transactions
  • Completed $43 million Series A funding round led by a16z on June 12, 2023
  • Decentralized autonomous AI agent network
  • Infrastructure for building intelligent, funded services
  • Offers a smart wallet, machine learning platform, and AI agent-based trading tool
  • Integrated with OpenAI’s GPT API and can act as an off-chain layer for L1 networks
  • Completed $40 million financing by DWF Labs on March 29, 2023
  • Received a $10 million support commitment from Bitget on April 27, 2023
5) Evolution from “Play to Earn” to “Play and Earn”

General Partner Arianna Simpson delves into the transformative shift from “play to earn” (P2E) to the emerging concept of “play and earn” in the gaming industry.

Traditionally, P2E games allowed players to earn real-world money based on the time and effort they invested in gaming. This trend reflects broader shifts transforming the gaming realm and beyond, encompassing the rise of the creator economy and altering relationships between individuals and platforms.

Undeniably, web3 tech is a catalyst in countering the prevailing norm, where all proceeds from gaming activities primarily benefit gaming companies. Users who contribute substantial time and value to these platforms deserve compensation for their participation.

However, the transition to “play and earn” signifies more than a mere alteration of nomenclature. It encapsulates the vision of games that are not only enjoyable but also empower players to capture a more significant share of the value they contribute. This evolution seeks to differentiate gaming from traditional workplaces, acknowledging the dual nature of these interactive environments.

As P2E transforms its initial challenges, the dynamics of gaming economies will inevitably undergo shifts. Foreseeing the integration of “play and earn” into the fabric of gaming experiences, this trend is poised to become an integral and inseparable part of the gaming industry.

a) EthXY
  • One-click poker MMORPG game on Telegram.
  • PvP and poker battle mechanics.
  • Operates on-chain on the Base network.
  • Players can earn loot through various incentive structures.
  • Attracted 1,060 ETH in bets and over 30,000 player matches in the first two weeks.
  • Completed a $1.6 million pre-seed funding round on November 15, 2023, with participation from a16z CSS23 accelerator program.
b) Proof of Play
  • Blockchain gaming startup.
  • Focus on creating enjoyable all-chain games.
  • The beta version of their first on-chain role-playing game, Pirate Nation, is live.
  • Features competitions, PvE, PvP, customizable characters, and islands.
  • Pirate NFTs are based on Ethereum and the game is built on Arbitrum Nova.
  • Completed a $33 million seed funding round on September 21, 2023, co-led by Greenoaks and a16z.
6. Integrity in Web3 Games through AI

Carra Wu, Investing Partner at a16z, sheds light on the imperative need for guarantees when AI agents take center stage in games. The crux of this perspective lies in ensuring that AI models are not only based on specific frameworks but are executed without any corruption, safeguarding the integrity of the gaming experience.

In a landscape where lore, terrain, narrative, and logic are procedurally generated—signifying the advent of AI as the game maker—there arises a critical demand for credible neutrality in the game-making process.

Besides, users and players seek assurance that the virtual worlds they engage with are on a foundation of guarantees. It is where the inherent strength of crypto comes into play, offering guarantees beyond traditional gaming frameworks.

Moreover, the most vital contribution of crypto lies in its ability to provide guarantees, allowing users to comprehend, diagnose, and penalize instances when AI deviates from its intended course. Wu identifies the “AI alignment” challenge as an incentive design problem akin to dealing with any human agent. This alignment of incentives is at the core of what crypto fundamentally represents.

Essentially, integrating crypto into the gaming landscape becomes a pivotal force in addressing the challenges associated with AI in games, ensuring accountability, transparency, and integrity that aligns with the principles of the crypto ethos.

a) Pahdo Labs
  • Game studio developing anime-style action role-playing game Halcyon Zero.
  • Launching a UGC platform for anime game creation.
  • Allows players to create unique anime-style mods and worlds with generative AI tools.
  • Completed a $15 million financing round on September 12, 2023, led by a16z.
b) CCP Games
  • Independent game developer established in 1997.
  • Known for award-winning sci-fi space epic MMO EVE Online.
  • Developing a new AAA-grade blockchain game in the EVE Online universe.
  • Utilizes smart contracts and blockchain technology.
  • EVE Online’s player-operated organization Neural Nexus appoints ChatGPT as leader.
  • Aims for long-term development and reduced dependence on a single leader.
  • Completed a $40 million funding round on March 21, 2023, led by a16z.
7) Evolution of Formal Verification to a Less Formal One

Karma (Daniel Reynaud), Research Engineering Partner at a16z, delves into the transformative shift in formal verification methods in the software scene and, particularly, smart contract development. Traditionally more prevalent in verifying hardware systems, formal methods have been less common in software development due to their perceived complexity and potential cost and time implications.

However, the demands of smart contract developers present a unique scenario. In handling transactions involving billions of dollars, the consequences of bugs in smart contracts can be devastating, and traditional hotfixes may not be a feasible solution. Recognizing this need, a new wave of tools, including a16z’s, has emerged, offering a significantly improved developer experience compared to conventional formal systems.

These tools leverage the inherent simplicity of smart contracts’ architectural design—atomic and deterministic execution, absence of concurrency or exceptions, small memory footprint, and limited looping.

Moreover, the performance of these tools is on a rapid upswing, benefiting from breakthroughs in SMT (Satisfiability Modulo Theories) solver performance. SMT solvers employ sophisticated algorithms to identify or confirm the absence of bugs in software and hardware logic.

With the growing adoption of these formal methods-inspired tools among developers and security specialists, the trajectory is set for the next wave of smart contract protocols to exhibit enhanced robustness and reduced susceptibility to costly hacks.

a) Buildspace
  • Crypto developer community offering Web3 training courses.
  • Live sessions and a platform for Web3 developers to interact.
  • Current courses include Solidity, Ethereum NFTs, and Solana Web3 App development.
  • Opened the first campus in Francisco in July, allowing students to build freely.
  • Completed a $10 million funding round on November 18, 2022, led by a16z, with participation from Y Combinator and Solana Ventures.
b) Convex
  • Global state management platform for full-stack TypeScript and Web3 developers.
  • Developers can interact with the shared state using JavaScript or TypeScript functions.
  • Bind state to reactive applications.
  • Completed $26 million Series A funding round on July 4, 2022, led by a16z, with general partner Martin Casado joining Convex’s board of directors.
8. NFTs Will Pioneer a New Era of Brand Assets

Scott Duke Kominers, Research Partner at a16z, explores the increasing integration of NFTs as digital assets by established brands in mainstream consumer engagement. Noteworthy examples include Starbucks, which has introduced a gamified loyalty program where participants collect digital assets while exploring the company’s coffee offerings- and Nike and Reddit, venturing into creating digital collectible NFTs with a broad audience in mind.

The potential applications of NFTs for brands are vast. Beyond serving as digital collectibles, brands can leverage NFTs to represent and strengthen customer identity and community affiliations.

Furthermore, NFTs can bridge physical goods and their digital counterparts, facilitating a seamless and integrated consumer experience. Kominers emphasizes the collaborative aspect of NFTs, noting that brands can co-create new products and experiences alongside their most dedicated enthusiasts.

Besides, the recent trend of affordable NFTs for large-scale collection often managed through custodial wallets and Layer 2 blockchains with low transaction costs, has potentially paved the way for NFTs to become ubiquitous digital brand assets. Kominers and Steve Kaczynski anticipate this transformation, highlighting the conditions that position NFTs as an integral component for a diverse array of companies and communities heading into 2024.

  • Music NFT platform focused on internet music discovery.
  • Open to all artists with a mission to fix the music streaming economy.
  • Allows artists to profit and retain 100% of publishing rights.
  • Generated over $5.5 million in revenue within a year.
  • Completed a $20 million funding round on July 12, 2022, led by a16z, bringing total funding to $25 million.
b) Ready Player Me
  • Metaverse identity platform for establishing virtual identities through NFTs.
  • Developers can integrate the platform into their applications.
  • Over 3,000 partners, including VRChat, Somebody Space, and Nike’s NFT studio RTFKT.
  • Completed a $56 million Series B funding round on August 23, 2022, led by a16z, bringing total funding to $69 million.
9) SNARKs Will Be Mainstream

Sam Ragsdale, Investment Engineer at a16z, explores the computational workload verification scene and the rising prominence of SNARKs (Succinct Non-interactive Arguments of Knowledge). Traditionally, technologists relied on strategies like re-executing computing on trusted machines, executing computing on specialized machines (TEE trusted execution environment), or leveraging credibly neutral infrastructure, such as blockchains. However, each strategy had inherent limitations in terms of cost or network scalability.

Currently, SNARKs are gaining traction as a more usable alternative. They enable the computation of a “cryptographic receipt” for a compute workload by an untrusted “prover,” rendering it impossible to forge. While past implementations incurred a 10^9 work overhead over the original compute, recent advances significantly reduced this number, bringing it closer to 10^6.

Moreover, the viability of SNARKs comes into play in scenarios where the initial compute provider can accommodate a 10^6 overhead and clients cannot re-execute or store initial data. The applications are diverse:

  • Edge devices in the Internet of Things can verify upgrades.
  • Media editing software can embed content authenticity and transformation data.
  • LLM inferences can include authenticity information.

The potential extends to self-verifying IRS forms, unforgeable bank audits, and numerous consumer-centric applications.

a) zkSync
  • L2 protocol based on ZK rollup architecture.
  • Funds held by a smart contract on the main chain.
  • Computation and storage occur off-chain.
  • Validators package transactions in a block, submit root hash, and cryptographic proof (SNARK).
  • Matter Labs, the team behind zkSync, completed a $200 million Series C funding round, with participation from a16z, on November 16, 2022.
b) Manta Pacific
  • L2 network powered by Manta Network, driven by zk-SNARKs.
  • Offers programmable ZK and ZK applications using Solidity.
  • Launched Universal Circuits 2.0 for deploying EVM-native ZK applications.
  • Introduced ‘New Paradigm’ for yield tokens and composability on L2.
  • p0x labs, developer of Manta Pacific, completed a $25 million funding round led by Polychain Capital and Qiming Venture Partners on July 19, 2022.

Andreessen Horowitz (a16z), known for substantial investments in crypto ventures like Yuga Labs, Solana, and Uniswap, has tempered its enthusiasm for crypto investing this year. Notably, the firm’s most significant crypto-related fundraises, as indicated by funding aggregator CryptoRank, all transpired before 2023. Moreover, a perceived omission of crypto references in Marc Andreessen’s “Techno-Optimist Manifesto” from October raised eyebrows among crypto enthusiasts.

Nevertheless, the close of 2023 witnessed a notable shift in sentiment within the crypto industry. As 2024 unfolds, a16z outlines key crypto trends centered on decentralization, improved user experience, modular technology, the democratization of artificial intelligence, gamified economies, brand-related NFTs, formal verification, and the mainstream adoption of SNARKs.

Amid the increasing excitement, the entry of new market participants, and the growing enthusiasm, it remains crucial to monitor key indicators and stay attuned to significant narratives. So, stay tuned for more!

The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.


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