Blockchain technology has been a momentous innovation, with many in the space referring back to Internet Bubble for comparison.
Despite a down month for the market at large in January, cryptocurrencies are still rapidly growing as technological assets and consumer products. February and March are setting up to be critical months for crypto, as investors, analysts, and just about everyone else is eager to see how cryptocurrencies rebound and continue to mature.
With that in mind, here are four cryptocurrency trends to watch this year:
1. The rise of stablecoins.
Cryptocurrencies represent a wealth of potential uses for finance and we are preparing to witness the employment of one of its most talked about applications. Among the first envisioned applications of blockchain technology was its use as a digital currency facilitating secure and efficient payments. The biggest problem facing this is the current level of volatility in the market renders most tokens an unreliable store of value for everyday transactions and commerce.
Stablecoins seek to change this narrative of fluctuations by pegging the token’s value to another asset such as fiat currency. Tether is currently the largest stablecoin, pegging the value of Tether to the US dollar by holding USD privately and issuing additional Tethers, swapping back and forth as necessary. However, Tether has come under heavy scrutiny recently with serious concerns regarding transparency and legitimacy.
Proponents of stablecoin are focused on an alternative mechanism to maintain a consistent token value in a trustless system on the blockchain. This method backs each token with another decentralized crypto asset, thus relying on smart contracts to hold collateral rather than in a private account or vault. By over-collateralizing their currency, this approach can offer price stability without compromising transparency, opening the door for exciting new possibilities in stablecoin in the coming months.
2. Sharp consumer accessibility and participation increase in the crypto market.
As the public continues to learn about the tremendous capabilities of blockchain and cryptocurrency technologies, more and more people are trying to buy in. The massive market boom in December 2017 forced many exchanges to close their doors to new users due to server accommodation constraints, while others began to require a lengthy identity verification process.
Now, with cryptocurrency prices dropping over the past month, potential users are choosing platforms to buy cryptocurrency and exchanges are heeding their calls.
New cryptocurrency exchanges are quickly establishing themselves, allowing faster, cheaper, and unlimited transactions, ease of conversion to fiat currency, and improved user interfaces.
Cointal is one of these new peer to peer cryptocurrency marketplaces tailoring their user experience to assist beginners while enhancing speed and functionality for all traders. Users can buy Bitcoin, Ethereum, Ripple, Bitcoin Cash, and Litecoin quickly without deposit or withdrawal restrictions. Purchasing cryptocurrency is free of fees.
Cointal also offers live support and free insurance on transactions, simplifying the process of entering the crypto market. This is perfect for beginners and more advanced cryptocurrency users, making the platform a great alternative to traditional exchanges.
3. Application to traditional B2B markets
The virtue of blockchain and cryptocurrency technologies is the flexibility of the distributed ledger they rely on. It is abundantly clear that this feature is valuable in transparency and organization, its non-specificity allows it to be utilized across industries.
Numerous explicit applications are well documented, the most common of which are in the information, finance, and healthcare sectors. But the list of use cases is rapidly expanding as more developers build decentralized apps, with teams now applying the possibilities of blockchain technology to less expected areas including transportation, sports, and real estate.
Among these pioneers in cryptocurrency use cases is NewEra, a blockchain-enabled carbon credits certification protocol. This company has created a decentralized platform to incentivize and accurately record a cleaner individual energy footprint. Individuals produce Emission Reduction Units, which can be exchanged to NewEra Tokens for use within the community. By integrating environmental awareness with the trusted recordkeeping of smart contracts, NewEra has built a green economy on the blockchain.
4. Inflow of institutional money into crypto.
It has been said since the beginning that Wall Street’s eventual decision of whether to adopt cryptocurrency will have massive market implications. Thus, many have followed larger financial institutions and their stances on cryptocurrencies as an indicator for certain growth and wider adoption. Now with major players in the space learning more about cryptocurrencies, such as Goldman Sachs and JP Morgan, the question is not if they will invest, but when will they invest.
Goldman is already setting up a cryptocurrency trading desk, so definitely keep your eye on this one. Blockchain technology is still improving and expanding, too. Cryptocurrency was the highest performing asset class in 2017 and is generating even more excitement this year. In short, major developments in blockchain technology, cryptocurrency regulations, and public sentiment over the next quarter is nearly inevitable, so be sure to stay informed and HODL as crypto remains at the center of conversations in 2018.