Last year was full of unexpected news, quite a few challenges, and twice as many innovations and developments. Many industries suffered and were impacted by the worldwide pandemic making more room for improvements and digitalization of products and services.
What were the digital asset investment trends in 2020?
Significant growth in venture funding allocated into crypto and DLT companies.
Approximately 3.1 billion USD were allocated in crypto/DLT projects, as well as a 6% increase in year-over-year venture capital’s transaction volume that is seen as being overall consistent. It is also important to note that two of the most dominant investment reds were DeFi (Decentralized Finance) and Brokerage & Custody firms.
The highest number of M&A transactions in the sector’s history.
Last year saw three top-ticket purchases that qualify as some of the largest in the industry’s history, costing 950 million USD together. Those included Binance’s acquisition of CoinMarketCap, the purchase of two crypto exchanges — Bitstamp and Poloniex, and the acquisition of Blockfolio by the crypto exchange FTX.
What were the payment and banking trends in 2020?
Banking on Crypto
Last year was very active regarding the financial services’ interest in digital assets. Some of the largest and influential companies strategically stated their desire on expanding crypto capabilities and exploring new digital asset offerings. It also raises interest in FinTech discount brokers, wealth management platforms, and other even more traditional financial services companies.
What were the topics of DeFi in 2020?
Principle of Decentralized finance
DeFi has adopted already known and applicable principles from traditional finance. The concepts of traditional finance are set side by side with DeFi principles — ICOs can be compared with IPOs and yield farming to employee stock option.
It has been estimated by The Block Research that more than 120 million USD worth of value has been exploited from DeFi contracts. These hacks occur from taking advantage of bugs in the code, from manipulations of prices and oracle, etc. As this is a significant trend, we will look at this topic in our near future blogs.
If you are interested in a more in-depth analysis of multiple FinTech trends and topics of 2020, you can read The Block Research — 2021 Digital Asset Outlook Report
Apart from our FinTech & CBDC blog series, we will be discussing multiple interesting and trending topics od 2020 and upcoming ones in 2021.