As the global economic recession continues to worsen in recent years, the token price of blockchain project has also fallen below expectations. As a result, the enthusiasm for blockchain and Web3 seems to have ebbed.

Why economic downturns happen?

From the perspective of unavoidable disasters, the unexpected outbreak of the COVID-19 pandemic has rapidly rippled through the world so far. The protracted battle against the pandemic has produced a considerable impact on people's lives in every country. COVID-related restrictive policies adopted by various countries have led to slow production, while international logistics control has also hindered international trade.

Judging from the turbulent international political situation, the U.S. War in Syria, the conflict between Israel and Pakistan, and the war between Russia and Ukraine all have hampered economic development.

From the perspective of economic policy, the United States has successively raised interest rates in 2022. On June 15, the Federal Reserve announced that it would increase the fund's rate by 75 bps to 1.5%-1.75%, which was the largest single interest rate hike since 1994. Inflation has continued to rise. While the policy of raising interest rates can alleviate the pressure on US Treasury bonds, it will nevertheless cause asset loss and economic damage to creditor countries. In the short term, interest rate hikes by other countries will result in the chain effects of curbing household consumption and enterprise investment in the short term, increasing unemployment, and suppressing economic growth.

As far as the long-term Kondratiev wave is concerned, this current cycle began in 1980 and will probably end in 2040. It is still at the trough of the wave chart, and new opportunities have yet to come.

Will Web3 stagnate?

Even if the overall environment is unfavorable, growth will nevertheless not stop its marching steps. International support for Web3 has been in continuous expansion. In December 2021, the U.S. Congress held a hearing on Web3, which instantly drew global market attention to the encryption industry. In May 2022, Japan's new prime minister Fumio Kishida said in a speech that the advent of the Web3 era may spearhead Japanese economic growth and called for resolute government support for improving the Web3 environment. After that, the Japanese government has unveiled a plan to comprehensively improve the Web3 environment. On February22, 2022, Ukraine's official Twitter account put out a call for crypto donations and financial aid from netizens worldwide, and directly gave two wallets: bitcoin and Ethereum, to accept such donations. This has enabled more people to know more the security and convenience of blockchain technology and digital currency.

It takes time to popularize information and implement policies. The positive attitude of various countries will certainly increase policy support for Web3, expand traffic, and make more people pay attention to Web3 and join it.

The future of Web3 is very clear

Despite an unfavorable economic environment, Web3 nevertheless represents the trend. Most blockchain projects believe in the future of Web3 and are making unremitting efforts in various fields of Web3. Let's pick up a few projects to see why they have the potential to be popular.

NFT — — — Opensea

Opensea is the world's largest NFT trading platform. Users can realize free trading and mint NFT on the platform. NFT can be marketed on Opensea with no requirement of permission or any approval process. It also innovates a method to transfer the cost of mingting new NFT on Ethereum from the seller to the buyer, thus effectively reducing the entry threshold and increasing the number of NFT on the platform.

Storage — — — DMC

DMC is a decentralized storage platform, through which users can access storage and rental space services. A computer is the only device which users need to start DMC storage service, so the threshold is low. The innovative "matching transaction" function of the platform can win reasonable prices for both buyers and sellers, thus truly realizing decentralized worry-free trading.

Creator's Economy Platform — — — Gitcoin

Gitcoin is an open source platform, which everyone can use and get paid to work on open source software in Python, Rust, Ruby, JavaScript, Solidity, HTML, CSS and design. The low threshold and Dao governance also add vitality to the community. It is novel to use grants to bring in new developers, which helps to attract new community members and developers to join.

Although these three projects cannot be generalized in a simple way, it is enough to see that an outstanding project must firstly have a low threshold for everyone to use, and then have innovation and core competitiveness. Even in today's sluggish market environment, so many mature and outstanding projects have already emerged. If the global policy is slowly liberalized, Web3 will surely greet its moment of prosperity.