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The industry of cryptocurrency and blockchain has had a particularly turbulent year. In January, Bitcoin prices were well over $ 18,000, and in December fell below $ 4000. It seems impossible to give a reasoned judgment on what the prices will be that the market will keep afterwards.
That said, when we get to wider market trends, 2018 has seen a number of precedents that could mark the start of some future industry trends. Here are the main non-price expectations of Hard Fork for the cryptocurrency and blockchain industry in 2019.
The SEC will surrender hard on "influencer"
The Securities and Exchange Commission (SEC) will go great by distributing sanctions to "cryptocurrency influencers". In November, the SEC authorized Floyd Mayweather and DJ Khaled to promote a cryptocurrency business now deceased to potential investors without declaring that they had been paid to do so.
This establishes a legal precedent that could potentially be used in future cases against influencers or "advisors" who fired coins and not declared, who subsequently cashed and lost money to investors. In the next year it is very likely that we will see more of these influencers being indicted by the SEC.
The cryptocurrency tax is unavoidable
The old adage brings us only two certain things in life: death and taxes. Although cryptocurrency promises a financial system that governments can not control, it does not prevent them from taxing it.
In many countries, cryptocurrency holders are subject to capital gains tax, which means they have to pay taxes on any profits made on their digital assets.
France has already imposed a flat-rate cryptocurrency tax. During the recent G20 summit, world leaders were united in discussions about the need for an international cryptocurrency tax, for companies that operate across many borders. Not to mention Japan, which is persecuting those who are actively avoiding paying taxes on large profits from the trade in digital goods.
We can be sure that we will see other cryptocurrency taxes being introduced next year, as more and more governments will come to terms with technology regulation.
Extraction of cryptocurrency to undergo further rationalization
At the beginning of this year, the research showed cryptocurrency the miners are struggling to make a profit, despite the large income.
This year has already seen Genesis Mining soon concludes contracts with end customers citing their non-profitability. Giant of Japanese internet infrastructure, GMOs, recorded a loss of $ 5.5 million for its mining division in the third quarter. Swedish the miners have accumulated huge debts with local authorities and then vanished.
The Bitcoin algorithm is self-correcting, as its difficulty adjusts every two weeks to keep the production of blocks on a constant block every 10 minutes.
While the miners are closing their operations, the overall willpower of the network decreases, so even the difficulty decreases. For some, this may be enough to induce them to start mining again, but if the potential cryptocurrency premium is still too low to exceed the cost of electricity, it may not do so.
Bitcoin can become green in 2019?
Bitcoin often fills badly with how much energy it uses in its extraction process, this is not necessarily a problem, but where does electricity come from.
Cryptocurrency miners naturally gravitate to low-cost electricity to maximize profits, and since renewable energy becomes cheaper than fossil fuels, it is logical for miners to shift to these sources.
The mining sector is already a big business in countries where renewable energy is favored, such as Sweden, where over half of the country's energy needs are met by hydropower.
The cryptocurrency mining company, DMG Blockchain Solutions, has recently announced the launch of its 85-megawatt mining plant powered entirely by hydropower. Recent reports have also estimated that renewable energy services three quarters of Bitcoin's energy demands. It may seem that 2019 may be the year when Bitcoin turns green.
A Bitcoin ETF on Wall Street?
It has been discussed for months and, given the recent developments, a Bitcoin ETF offered on Wall Street could be on the horizon. We can be sure that those who want a Bitcoin ETF on Wall Street will not stop trying. That said, they have a lot of work to do to meet the SEC, as every hopes of a Bitcoin ETF have been recently canceled – again.
Digital asset exchanges such as Coinbase and Abra have started offering cryptocurrency funds this year, respectively in their Coinbase token and the BIT10 token. Although these are not strictly ETFs, they certainly borrow some of the characteristics of an ETF.
Given that the Nasdaq recently announced the launch of Bitcoin futures in 2019 and the recent launch of a Swiss exchange product (ETP), the Amun Crypto Fund, it certainly seems that traditional financial institutions will continue to enter the game of cryptocurrency in the next 12 months.
Block for the future?
Of course, we can not know for sure that one of these things will actually happen. But given recent trends, they are part of a growing narrative that looks set to continue. Perhaps one thing we can be sure of is that the market will be very different this time next year.
Published January 4, 2019 at 12:00 UTC
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