AT&T Capital publishes the Web3 Trends 2023 report

AT&T Capital has released a report titled “Web3 Trends 2023” that looks into the six trends that will affect the future of the Web3 industry. The report noted that the annual assets under management (AUM) in the Web3 sector were over $50 billion, while the non-fungible token (NFT) space had surpassed a $20 billion valuation.

Web3 sector has grown significantly

The report looked at the growth of the Web3 and NFT markets. It noted that the AUM for the primary market investment for the Web3 sector had surpassed $50 billion. On the other hand, the NFT market has reached over 3 million holders, with the sector’s total value surpassing $20 billion.

AT&T Capital noted that there was significant value across multiple areas in the Web3 sector, including infrastructure, applications, and middleware. It also mentioned the changes in the crypto industry over the past year.

The report noted that the collapse of FTX had created new lessons for the market as exchanges became more transparent. It added that the release of proof-of-reserves by multiple exchanges was a trend that would continue in 2023. Moreover, the growing regulatory attention in the sector would lead to creation of hybrid platforms that differentiate between custody and clearance.

AT&T Capital further noted that the demise of FTX showed the benefits accrued from adequate risk management and complying with regulatory requirements. It also showed that crypto exchanges must refrain from using customer funds to support internal functions and avoid over-leveraging.

New technologies transforming the Web3 sector

The report also looked at the new technologies adopted across the Web3 sector. One of these technologies is ZK layer 2 solutions that will support scalability for the Ethereum blockchain in the long run. Besides scalability, ZK layer 2 solutions would also support connectivity between different blockchains and lower barriers for developers.

It further noted that parallel computing technology maximized the capability of blockchain. Other new offerings were modular design and application-specific blockchains. Besides transforming the finance and money sector, blockchain technology could also be used in other areas, such as gaming and social media.

Wallets also played an important role in the Web3 industry. Nevertheless, wallets were constantly threatened by security and poor user experience. Some of the wallets seeking to solve this problem are AA and EOA wallets, whose popularity is fast increasing. These wallets provide Web2 security and user experiences.

Increased access to the MEV market also expanded revenues. The average value of MEV Boost blocks was over three times that of vanilla blocks. So far, Block Builder has paid more than 70,000 ETH to validators three months after the Ethereum Merge happened, and the MEV is expected to continue increasing.