Ever since Bitcoin had entered the market back in 2009, the cryptocurrency market has experienced its ups and downs. While 2017 was considered the year of the cryptocurrency, 2018 was the year of cold reality. Now, 2019 is almost halfway through and people are wondering what will happen to the crypto market.
Unfortunately, the main events that marked the crypto market were the downfall in Bitcoin price along with numerous scams, hacks and frauds. This made people lose trust in the crypto market and the cryptocurrencies themselves.
On the other hand, blockchain technology has gained momentum and many companies are developing the technology further while attempting to discover new implications and system where this technology can show off its true potential.
It's safe to say that the cryptocurrency phenomenon is still ongoing with no signs of stopping or slowing down anytime soon. However, people are looking upon the crypto market with a different perspective than they used to. With that in mind, here are a few trends that are ahead for the crypto industry in 2019.
Possible currency regulations
The feature that defined the crypto industry was its separation from any governments or banks. Even the blockchain technology was presented as decentralized public ledger designed for peer-to-peer transactions with no third parties involved.
As much as people have entertained the idea of the lack of regulations, it eventually backfired. Numerous frauds, hacks and scams have plagued the crypto industry and people who lost all of their assets had nowhere to turn to and no means of recovering their losses.
This has resulted in crypto industry's market cap to plummet from $850 billion to only $260 billion in just a few months. Today, the U.S. SEC (Securities and Exchange Commission) is investigating possible scams and illegal coin offerings, in order to combat the ever-growing opportunities for frauds in the cryptocurrency market. It seems that the unregulated market can no longer go unregulated and that a global consensus is required to deal with the situation.
The rise of stablecoins
Another factor that's been plaguing the crypto industry is extreme volatility. Cryptocurrencies, such as Bitcoin, Litecoin and Ethereum are simply not suitable for everyday trade. The main reason is that the majority of cryptocurrencies are extremely volatile. They can appreciate or depreciate between 20% and 30% in a matter of hours. These conditions are simply unsuitable for merchants, suppliers or even for individual purchases.
This situation created a trend of stablecoins or stable crypto's. Companies are developing a stablecoin that will neutralize extreme volatility and safeguard investor holdings, while also attempting to win back the trust people have lost in the cryptocurrencies altogether.
But what exactly are stablecoins? Stablecoins are cryptocurrencies that are linked or "pegged" to real-world assets, such as flats like USD, EUR, gold and even oil in some cases. They still have their own blockchain technology and are not linked to any central banks or governments. Instead, they rely on their strength and cryptographic audits to ensure that the underlying asset where it's supposed to be and that it's, in fact, present to begin with.
Decentralized networks and exchanges
Another trend that's on the rise is decentralized networks in the crypto industry. Whether this trend will rise in 2019 remains to be seen, but it's certainly not long before this trend becomes a standard. The fact of the matter is that decentralized networks have made significant progress in terms of studies, infrastructure and tools required to make social credit, open finance and collateralized loans possible.
Every aspect has been perfected and proven to be working. Now, all that is left is for this trend to take off and serve its intended target audience, which are the people who have been excluded from the current financial system. Even though centralized exchanges normally overcome the essence and the purpose of cryptocurrencies, the major selling point of the majority of cryptocurrencies is, indeed decentralization.
It's kind of ironic that centralized exchanges determine the success or failure of decentralized cryptocurrencies. This calls for a change and that is why decentralized networks are predicted to rise in the near future. In addition, with major players in the industry taking an interest in the decentralized networks, there's a greater likelihood of their mainstream adoption. Aside from that, with the vast support these networks are getting, they're also becoming a more reliable solution.
Bitcoin isn't going away
Even though Bitcoin has been eroding ever since the day it made its entrance on the market and though many experts predict its death, the very first cryptocurrency isn't likely to go away any time soon. One of the reasons is that Bitcoin, despite its volatility, is still one of the most stable currencies on the market.
In addition, the price of Bitcoin in most part influences the price of any other altcoins on the market. Some experts claim that Bitcoin's influence over the price of altcoins is nearing its end, it's unlikely that it will happen any time soon. For that reason, investors are more likely to perceive Bitcoin as a safer bet than other altcoins on the market. Bitcoin might be losing its dominance on the crypto market but it's still referred to as the point of origin and you simply cannot get rid of it that easily.
The crypto industry is still fairly unstable. Even though it possesses a vast potential, especially the blockchain technology, people are more cautious and skeptical about cryptocurrency advances. Will these trends make a significant change to the industry itself remains to be seen. All people can do is wait and see how the events will unfold.
____________________________________________________________________________________________________ Disclaimer: This is a guest post and author owns the content. It is not an investment advice and should NOT be viewed as project endorsement by EtherWorld. Readers are suggested to do their research before investing into any project.
Disclaimer: This is a guest post and author owns the content. It is not an investment advice and should NOT be viewed as project endorsement by EtherWorld. Readers are suggested to do their research before investing into any project.