How Asia is Driving the Next Crypto Bull Market

We have come to the beginning of the next bull market. If history is our guide, these cycles are driven by various factors, including Bitcoin’s halving events, shifts in macroeconomic landscapes surrounding US elections and Federal Reserve interest rates, as well as the arrival of new Web3 and DeFi innovations. For example, yield farming was a significant innovation that fueled the previous cycle. The upcoming cycle could potentially feature a mix of zero-knowledge proofs, new DeFi primitives like reset, and innovative blockchain stacks that offer modularity, composability, and are primed for interchain assets and data movement.

This post is part of CoinDesk’s “Crypto 2024” forecast package.

Each cycle is accompanied by a unique cultural narrative. The last cycle was dominated by art NFTs, fueled by Beeple’s $69 million sale at Christie’s, and fueled further by the PFP craze and the fine art trade growing with advocates on the scale of Sotheby’s and Pace Gallery. The current cycle, according to predictions, will be shaped by the SocialFi narrative, as platforms like Friend.Tech have already set the stage.

Institutional and regulatory narratives also play a crucial role. In the last cycle, MicroStrategy’s Michael Saylor introduced Bitcoin to the corporate balance sheet, while this cycle is characterized by traditional financial institutions and fintech giants applying for crypto ETFs and launching stablecoins.

On the regulatory front, the US continues to wrestle with crypto regulations, causing many projects to market their new crypto products outside the US. This is why I argue that the next bull market will have a distinct geographic flavor, with Asia at the center.

The enthusiasm for crypto in Asia is hard to miss. A sharp contrast was visible between less lively fall conferences in the States and the buzzing scenes at Korea Blockchain Week and Token2049 in Singapore. Cities like Bangkok, Ho Chi Minh City, Jakarta, Manila and Kuala Lumpur, not to mention a handful of major Indian cities, are home to sizeable developer communities and thriving Web3 scenes, boosted by government support and enterprise adoption. The thriving environment at Token2049, in Singapore, the real capital deployed by APAC investors in crypto projects, and the increasing appetite for NFTs collectively suggest a region poised to fuel the next bull market.

While Asian governments are fighting for the top position as a crypto hub, the US seems to be discouraging its crypto entrepreneurs. As a result, marketing campaigns are excluding the US, businesses are expanding into Asia, Europe and the Middle East to meet growing demand, and entrepreneurs are moving to jurisdictions with a friendlier regulatory environment.

With the opening of Serotonin offices in APAC, I have seen first hand the unique advantages these markets offer growing crypto projects. From tech-savvy mobile-first audiences to high-quality developers eager to contribute to decentralized projects, the region is full of potential. There is a palpable enthusiasm for Web3 culture and a readiness to adopt new technologies, especially SocialFi, which is already the norm in the region, thanks to exposure to WeChat. (SocialFi refers to applications that allow users to monetize social interactions and control their own data.)

Telegram, used ubiquitously by the Web3 community in Asia for messaging, is already testing its in-app self-preservation crypto wallet with non-US users. Combine that with the regulatory friendliness of places like Hong Kong and Singapore, and we’re looking at a potentially explosive crypto boom. For us Americans, it seems inconceivable that Hong Kong-based First Digital, for example, could launch its stablecoin, FDUSD, with regulatory approval when fintech mainstays like PayPal face subpoenas to do the same in the US.

This “Asia Speed,” as we at Serotonin affectionately call it, is a testament to the region’s rapid adoption and contribution to Web3 technology. I believe this dynamic will steer the upcoming bull market and introduce a geographic story to the crypto cycle.

However, I foresee this scenario changing in about 18 months, after the next US election. I expect regulatory clarity to emerge for crypto in the US, sparking a new cycle of enterprise adoption and marketing to US consumers. This period will also see the re-emergence of the US as a primary driver of Web3 innovation and adoption, contributing to a thriving global Web3 ecosystem, with leadership from Asia and other markets.

Meanwhile, our strategy is to use this time to grow our business with a focus on Asia. We facilitate Western projects’ entry into Asian markets, form partnerships with projects of Eastern origin to go global, and engage with English speakers in Europe and the Middle East. All in all, the crypto world is poised for a more diverse and dynamic era driven by various global forces, with Asia leading the charge in the impending bull cycle.