Micah Winkelspecht is CEO and founder of Gem, a cryptographic portfolio app company based in Los Angeles.
The following is an exclusive contribution for the 2018 year of CoinDesk under consideration.
If 2017 was the year of irrational exuberance, 2018 became the year of reality checks when the market broke out and crashed. I predict that this year we will see a return to the first principles while we think back to many of our hypotheses on how all this should go down. The truth is that we do not know yet.
I also believe that 2019 will see the return of the bitcoin domain, even though it may require a major slowdown in the world market to stimulate it.
As global markets deflate, this will also reduce the price of bitcoins and keep them low because deflation will cause investors to abandon perceived and risky investments in more stable investments and bitcoin is currently considered a very risky investment.
But when governments start making money-stamped helicopters to try and recover their failing economies, that's when the bitcoin will start to be seen as something more similar to gold.
1. The true promise of Ico
The crazy bull market of 2017 and early 2018 and the glorification of initial coin offerings (ICOs) have had such a disorienting effect. We have had a great migration from the principles and values of a decentralized economy to a scheme rich in benefits for all.
People have really been sucked.
I believe that ICOs are indeed very promising if well done. The most exciting and powerful thing we have learned from Bitcoin's success is that crypto has the unique ability to align all stakeholders (users and investors) around a common mission through shared incentives and direct participation.
Crypto makes users feel invested in the success of a project and creates a powerful network effect. The challenge is that we have seen more speculators than real users.
2. The first Killer Breakout app
This is the year in which we will make the difficult transition from speculation to use as the industry matures from adolescence to adulthood. And I do not mean adoption for adoption, but instead real products that offer real value.
We will see the first test point of a project, the killer unlocking app in which users are aligned within the token's economy, in such a way as to truly feel as if they were owners of a piece of the project. And I think it will probably come from a place we did not expect, like games. I think we'll see a really interesting first breakout in games, like a Tamagotchi.
And then we'll see a couple of new hits out of the game, because the games really fill the gap beyond technical users in a much larger class of early adopter users that extend beyond this highly insular technical audience. They are already used to this idea of digital resources.
They are already spending hours and hours trying to collect digital goods. It is a natural choice.
3. The Emergence of Stablecoins
We will begin to see the stable currencies that really fill this gap with respect to mass adoption.
We will see a class of payment applications in the style of Venus and other types of new creative financial products that exploit stable currencies to counteract the perceived volatility problems that Bitcoin and other cryptocurrencies have. It is not necessarily the original vision of crypto, but it is a great starting point for putting people at ease with digital resources and the tools are the same.
So it will also have a very positive effect on the increased adoption of Bitcoin and other networks.
4. Finding a middle ground
We are reaching a point of hybridization in which projects are finding success in a middle ground, where they are not so much the libertarian dream of total decentralization, nor are the highly centralized systems that run the world today. . And that's fine, because none of these extremes serves companies or users very well.
But we are witnessing the emergence of a hybrid with things like the proof-of-stake delegate and Hashgraph that has a known set of validators and is more decentralized than a centralized system, but not as decentralized as a working test network like Bitcoin.
There are clear compromises in these networks, but they have a good chance of success in reaching companies that need to be able to scale, who need a reliable framework to work on and are decent enough for those needs.
So, I think EOS, HashGraph, or even Stellar can start serving that need.
There is still no clear winner here. And until there is a clear winner, it is unlikely that you will see large organizations move serious money into space. They will be delighted.
What will it take?
Something in this area needs to drive the question. You can have all the supplies in the world, but if you do not have the question, it will not get us anywhere.
I am bearish for the short-term prospects for the corporate adoption of blockchain technology. For all its potential (and there is incredible potential), most large corporations would prefer to play theater innovation rather than investing major capital to reinvent their activities. The real change in the business is a long game.
The exciting stuff that is happening right now is the innovation and competition that is happening on public networks and everywhere.
People are trying a little bit of everything. And nobody has any idea what will work. And that's great because we'll find the answer much faster than you expect a Fortune 500 company to figure it out.
It is much more likely that we will discover cases of use that we have not even thought about due to the unauthorized nature of public blockchain systems and development without authorization.
Crypto offers us an open platform where anyone, anywhere in the world, can write a program that will potentially change the world.
This is the last dream of a crypto.
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