2018 was a disastrous year for cryptocurrencies, which saw their value plunge by 80% between January and September. But as we begin 2019, industry participants remain overall confident on the future of cryptocurrencies and their underlying technology, the blockchain.
Many predict the industry will further mature this year, with several applications to debut in 2019, delivering on their 2017 promises, while others expect several of 2018’s trends, including stablecoins and tokenization, to continue their momentum.
The followings are what top crypto experts and industry participants predict will happen this year in the space:
Expect “a new bullish phase in crypto”
Prominent venture capitalist and Union Square Ventures co-founder Fred Wilson has released his annual predictions blog post in which he forecasts “a new bullish phase in crypto” fueled by the many blockchain projects set to come to fruition in 2019.
“I expect we will see some bullish runs, followed by selling pressures taking us back to retest the lows,” he writes. “I think this bottoming out process will end sometime in 2019 and we will slowly enter a new bullish phase in crypto.”
“I think we will see some big name projects ship, like the Filecoin project from our portfolio company Protocol Labs, and the Algorand project from our portfolio company Algorand. I think we will see a number of ‘next gen’ smart contract platforms ship and challenge Ethereum for leadership in this super important area of the crypto sector. I also expect the Ethereum open source community to ship a number of important improvements to its system in 2019 and defend their leadership in the smart contract space.”
The making or breaking of cryptocurrencies
Arup Sen, a support lawyer at Taylor Wessing who worked for the UK Financial Conduct Authority (FCA) for five years, believes that 2019 will be the making or breaking of bitcoin, other cryptocurrencies and its underlying blockchain technology.
“After first grabbing the headlines back in 2011 with the advent of bitcoin, blockchain and cryptoassets have progressed significantly, with over 1,500 cryptocurrencies now vying for attention alongside various other cryptoasset types,” Sen told The Independent.
“But as the market and technology have grown, so has the volume of criticism and the strength of opposition. Payment specialists decry the slow processing times and high transaction costs associated with cryptocurrencies, law enforcement looks at initial coin offerings [fundraising through cryptocurrencies] as another way of scamming the public. And now the regulators are circling.”
Year of tokenization
The past years have witnessed a lot of hype around bitcoin and blockchain technologies, but in the background, a new economic infrastructure is forming, Kristjan Kangro, founder and CEO of Estonian blockchain firm Change, told The Independent. He cited the tokenization of assets which has already been changing how people invest, spend and raise capital around the world.
Echoing Kangro, Bruce Fenton, founder and managing director of Atlantic Financial, board member of the Bitcoin Foundation and co-founder of the Bitcoin Association, believes the main trend in 2019 will be securities tokens.
“The combination of the power of a distributed ledger with more standardized securities will open lots of doors in capital creation,” Fenton told Forbes. “Privacy will continue to be important. There will be an increasing gap between those with solid technology and those with weak, captive networks.”
Brock Pierce, an American entrepreneur, venture capitalist, chairman of the Bitcoin Foundation and co-founder of EOS Alliance, agrees, stating:
“A quadrillion dollar market is unfolding, driven by the emergence of security tokens. As currencies are tokenized, as bonds are tokenized, as equities are tokenized, as currencies and real estate and energy are tokenized. We are watching the birth of a quadrillion-dollar market.”
2019, a big year for stablecoins
According to Tory Reiss, co-founder and head of partnerships at stablecoin platform TrustToken, the next wave of the crypto market will be driven by real-world value and real-world use cases.
“This is the true excitement that traders are feeling around stablecoins in 2018: the promise of trillions of dollars of value being easily accessed and traded by anyone with a smartphone, anywhere in the world,” Reiss told Inverse.
Echoing Reiss, Phillippe Bekhazi, CEO of XBTO Group, predicts that 2019 will be the year of stablecoins.
“They can also be used as a mechanism to move value around in stable terms, and technically even for payments, although the speed of the underlying blockchain may be a limiting factor for time-sensitive transactions, for the time being,” he writes in a CoinDesk post.
Blockchain will further mature
2019 should witness further consolidation in the blockchain industry, which is set to enter the next phase of maturity, according to Arianna Simpson, a venture capital and managing director at Autonomous Partners.
For Justin Sun, CEO and founder of Tron, companies with differentiated business models will begin to separate themselves from the pack in 2019. Sun told Forbes:
“For the industry to mature and gain legitimacy, the 2018 shakeout had to happen. As you’ve seen with the rise of the internet, e-commerce and just about every other big-thought thing that’s happened in the last 50 years, the gold rush days come to an end, rules get created and people settle down to do real business.”
For Malta, 2019 will be “a historic year” as the country is set to issue the first licenses, enabling blockchain and crypto operators to operate in a regulated environment, Silvio Schembri, Malta’s Junior Minister for Financial Services, Digital Economy and Innovation, told Forbes.
“2019 will see the materialization of ‘the Blockchain Island,’ firmly putting Malta at the epicenter of this industry,” Schembri said.
“We are aware where the compass is pointing, which is why blockchain technology will be incorporated into our ecosystem. In turn, we will soon start witnessing change in the landscape of how sectors as we know today operate. In fact, as a Government, we’re looking at using blockchain technology in the public sector to better the experience of our citizens.”
Blockchain in supply chain
One area in particular that will likely see further adoption of blockchain technology is supply chain management. Jonathan Johnson, president of Medici Ventures and a board member of Overstock.com, expects a lot of supply chain applications to debut in 2019, providing more surety by both sellers and purchasers of the providence of goods.
“What VinX is doing in the wine business and GrainChain in the grain business, others will do in variety of industries,” Johnson told Forbes.
“And watch out Wall Street. Fintech will continue to be a major focus for blockchain use cases. Some will finally get into production and begin to revolutionize the ways securities trade.
“Blockchain will continue to be hyped as a panacea. Companies caught in this hype will waste money trying to use blockchain, where a good old-fashioned database does just fine.”
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