Back in 2009, Satoshi Nakamoto published the code of the first cryptocurrency called Bitcoin, laying the foundation of a new form of money. New cryptocurrencies emerged quickly, and now there are thousands of them.
A lot has happened to the crypto community in almost ten years: price roller coasters, acceptance growth, exchanges’ hacks, and more. While 2018 was the year of correction and maturation, how the crypto market would celebrate its anniversary in 2019?
Main Trends for 2019
The crypto community tends to focus on Bitcoin and Ethereum with much lower attention to other projects. It’s logical because these top currencies define the development of the whole market. Overall, after the insane price burst at the end of 2017, cryptocurrencies entered the correction phase.
Next year has all chances to change the tendency. There are two possible scenarios:
- Bullish trend. Crypto bulls will conquer the market and move prices up. The adoption will increase, too.
- Bearish trend. Bears will overcome their rivals and force the market to go down. This is likely to happen in the case of governmental and financial restriction.
It is still hard to make valid predictions. To see which way the wind is blowing, one needs to constantly read the market news, experts’ overviews, statistics, etc.
1. Acceptance by ETF
Probably, this opportunity was the most discussed during 2018. Simply put, ETF will allow traditional institutions and large investors to enter the crypto market without significant risks. If this happens, there will be no more talks about Ponzi schemes and bubbles as even governmental structures will use crypto. Enterprises and institutional investors will join the crypto community, as well. This is a win-win situation for all sides of the market including both occasional traders and trading platforms.
2. Rise of DEXs
Decentralized cryptocurrencies require appropriate marketplaces. There are already a lot of decentralized exchanges (DEXs), but they are limited by poor usability and expensive development.
In 2019, we hope to see the rise of decentralized systems where users can make deals without third parties, using their private wallets only.
To increase trading volume and replace centralized players like Bitfinex and Binance, DEXs have to become more user-friendly, improve their interface and overall design.
3. DApps Development
Decentralized apps (DApps) are the main purpose of the Ethereum network. The team of developers has introduced this technology through a funny game called CryptoKitties where users can collect digital pets. While the idea behind the game is amazing and smart contracts have the power to disrupt practically any industry, the project has revealed low scalability of the Ethereum’s blockchain. This platform and similar ones, like EOS and ADA, should solve the problem in 2019 and launch more useful DApps for various customers.
4. Better Education
The main problem with cryptos is that only the minority of people realize what they are and how to use them properly. Some governments blame crypto as an illegal and criminal invention which blows on the reputation of the industry. However, we can expect a rise in crypto education, as there already are some official programmes designed by leading universities. Educating a wider audience on the subject of digital currencies and technology may lead to the increase in adoption of crypto in the next year.
5. New Approaches to Evaluation
Traditional investors consider cryptocurrencies as toys for digital kids. They claim that Bitcoin and altcoins have no value at all. Crypto enthusiasts realize that their projects are valuable regarding security and innovations but they can hardly show exact numbers. This is because young crypto markets don’t have relevant historical methods. The crypto world may become more stable and less volatile thanks to elaborated evaluation.
Chris Burniske even developed a simple formula where the total size of assets added to their velocity is equal to the price of the digital resource added to its quantity.
6. More Security Tokens
Nowadays, the world is going through the ICO mania. Markets are filled with utility tokens launched by different startups. Nearly everyone can create a company and offer a new crypto that can impress geeks. However, more conservative investors or governmental figures are afraid of innovative utility systems. That’s why 2019 might be the year of security tokens. They represent the ownership of traditional assets like bonds or equities. Such coins may strongly connect the real world of classical entities to the innovative crypto universe.
7. Price Drops
Despite all positive promises, some experts, like Eric Kovalak from Vellum Capital, claim that the correction phase isn’t over and may turn into the bearish trend.
Before skyrocketing, all major coins will fall to their yearly lows
According to Kovalak, Bitcoin will be traded around $3,500 but then will rise again and move upper than its all-time maximum. Nobody can prove or disprove this prediction because of the high volatility.
8. Increased Interest
Despite some skeptic forecasts, the main trend should be positive. It is stated in the research of Satis Group concluded by Bloomberg that the total crypto trading volume will increase by 50% in 2019. In the US, this number will reach 10% of the total equity trading volume, and that’s a success. According to Satis Group, Bitcoin and large exchanges will grow. More than 3/4 of the worldwide volume will be controlled by the 20 biggest marketplaces, including Binance, Bitfinex, Huobi, HitBTC, and OKex.
Three Trends for Traders
While tendencies mentioned above suit all types of investors, the following ones should be useful for traders. Regardless of a trading type, it’s important to know how to deal with crypto during the following year.
1. Platforms as the Key
Crypto platforms like Ethereum are basements for further developments. DApps are great inventions but they aren’t ready yet to be widely applied. The network itself will be profitable anyway.
Ethereum represents one of the best crypto platforms and it suggests completely different approaches to regular things. Projects that were launched for specific purposes will survive and gain more influence – and the more innovative their purpose is, the better.
2. ICOs With New Game Rules
ICOs are attracting investments pretty intensely, and the community will continue this insane run. Unlike previous years, in 2019, ICOs should be more focused on private partners who invest during the pre-ICO stage. Be sure to check projects big investors showed their interest in.
As for more negative predictions, developers must prepare for bans. China and South Korea have already prohibited ICOs. With new regulative acts, more countries will impose strict requirements on ICO launching.
Regulations might be good for the crypto space, as they could remove it from the gray zone and make it more profitable for both countries as much as for developers and investors. But there are chances that more states will completely ban these projects.
3. Lightning Network to Improve Scalability
Nearly all blockchains suffer from poor scalability. And nearly all of them try to find a solution. Experts predict that Bitcoin’s off-chain technology Lightning Network will change the game.
Systems with extra payment channels and multi-signature wallets offer really fast and cheap transactions. Additionally, developers may launch Atomic Swaps to allow cross-chain transactions and exchanging crypto without using third-party platforms.
Lightning Network is expected to be implemented by Bitcoin and Litecoin, and the success of it will define the balance of power on the market.
As there’s no confidence in one-year forecasts, we want to go further. Trends evolve insanely quickly. In the long run, everything may change during a week or month, but significant tendencies should remain about the same. Let’s try to figure out the key trends for the next five years.
- Bitcoin will cost near $100,000. Investors remember the insane price jump near the end of 2017 and at the beginning of 2019. That’s why you may be wondered that Bitcoin is only starting its exponential run. The involvement of institutional investors and global authorities in the crypto world may speed up this process.
- National dependence on Bitcoin. Today, a lot of countries align their budgets with USD as the most popular currency around the Globe. We can expect BTC to take this role.
- Governmental regulations and taxes. We deal with traditional financial and governmental systems, and crypto is getting involved rather slowly. Proper laws and reasonable taxation may bring profits to both digital currencies and countries’ economy.
The Future of Top Coins
Finally, here are some predictions on large cryptocurrencies as they are most likely to define new tendencies of the market:
- Bitcoin. The main trendsetter will be even in a higher demand. The price may go up or down but the real usage of BTC will increase during the next year. If Bitcoin solves its scalability issues, it will probably be more convincing than solutions already suggested by Bitcoin Cash and Litecoin. As the first crypto in history, BTC is more likely to gain a green light for wider acceptance.
- Ethereum. The number two cryptocurrency stands out by its practical value. It also suffers from scalability problems and may grow massively in the case of solving them. But, as we’ve already mentioned, the thing with ETH is that it is way more than a revolutionary means of payment. This coin and the whole network bring smart contracts and DApps to the community, spreading the influence among different spheres. A lot of business eager to be viewed as groundbreaking are already actively implementing Ethereum’s innovations.
- Ripple. This is the only project from the biggest ones which successfully cooperates with banks. By doing so, Ripple has all chances to become the leader. It’s already on its way to correspond to the brightest forecasts – XRP increased in value in September 2018 due to the launch of xRapid, the platform designed to connect different currencies and provide fast transactions. The company expects dozens of banks to use xRapid in 2019.
- Litecoin. A proper alternative to Bitcoin has a relatively low cost. This currency may become the main payment system to perform everyday tasks. With its debit cards on the roadmap and a growing number of companies accepting it, LTC is moving towards being valued more.
There are other altcoins that may succeed in 2019. Eos, already called the ‘Killer of Ethereum’, may replace its main rival by solving scalability issues faster. Neo is also considered as an Ethereum-like project, and its path namely depends on regulatory processes in Asia. Stellar (XLM) is another top-notch crypto that will grow in popularity because of the security token it offers. Partnerships like the one with IBM (where Stellar-based products facilitate transactions on the enterprise level) may also push this process forward.
To Sum It Up
Considering that all cryptocurrencies are extremely volatile and the situation with regulations is yet to be stabilized, it’s hard to determine the likelihood of some trends being lasting and powerful. While 2018 has been tough for cryptos, the next year may finish the process of maturation.
We can expect the exponential growth in price from all major coins, but there are also chances of some completely new ones to make a hit. Most importantly, changes will be related not so much to prices as to ideas behind the specific projects.
Cryptos introduce new technologies and unexpected approaches to the world that might enhance many industries. So far as everything transforms rapidly, keep up-to-date and do your own research regularly.