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In the last ten years, Bitcoin and cryptocurrency have moved from an obscure niche currency to the mainstream. Miners used high tech to earn coins, security improved and digital portfolios came and went, replaced by the best ones. The coins were created and died, and companies even use Initial Coin Offerings (ICO) to increase the initial capital.
In the last year, however, Bitcoin had a bad time. After a volatile summer, the end of the year saw Bitcoin fall by 37 percent in November, and values fell further in December. Some say this is a market correction that was necessary because the value has been enormously exaggerated, where others say that 2019 will be the year of a big turnaround, and the currency could return to its $ 20,000 glory days or more.
No matter what the value of this year is, the financial markets are sitting and taking note. Consumers have less trust in banks and the security of traditional credit cards, so many are looking for a new place to invest and retain their money.
There are some cryptocurrency trends that this year will play a major role in the life of a variety of currencies, and all will have an effect on investors. Here are seven trends that could emerge in 2019.
1. Regulatory improvements
A certain change in the future of Bitcoin and other digital currencies is that the SEC and other agencies are taking note. Currency exchanges could soon be regulated similarly to stock exchanges, and traders will have to follow them.
Do you think this is something far? Do not make this mistake. The SEC has already investigated the illegal security offers and scams on the ICO market and, with the going forward of the year, will make these rules clearer. The good news is that there will be guidelines on how to issue coins, raise capital and operate in the virtual space of money. This is not a bad thing for an industry that at this point has been largely ruled like the wild west.
2. More mainstream trade
The purchase and sale of virtual currencies and even some daily trades have become more widespread, and even serious investors have taken note. The next step is that the main financial institutions will be involved.
For example, the Intercontinental Exchange (ICE) plans to offer futures contracts on Bitcoin starting in February. This program, called Bakkit, would allow traditional investors to buy cryptocurrency without having to manage the funds themselves. Coinbase and eToro are two other exchanges, but NASDAQ also plans to start offering Bitcoin futures to investors. Fidelity is also working on a cryptocurrency platform for its investors wishing to operate in this area.
Basically, the investment in Bitcoin and other cryptographies is going from obscure exchanges to larger stock exchanges and finance companies, taking another step towards legitimacy.
3. Improvements in Blockchain technology
It is quite known that the technology behind cryptocurrency is blockchain, and the idea of applying it to other fields has been in progress for a long time. But now there are startups working on one thing: improving technology. The idea is to make it even safer and more useful to other companies.
The Corda blockchain program is one of these, and even traditional banks have started to adopt this program, and the idea behind it is to offer it to more companies at the enterprise level. This is just one of the companies working to bring this technology into the traditional financial sector to improve security and increase customer confidence. IBM is working on stellar blockchain, and Ripple is another company that offers solutions for the financial sector.
4. Other Blockchain applications
At the same time, while the blockchain is being improved and more financial institutions are using it, other industries too, including health care, the legal profession and even retailing and sales, come into play. Facebook is studying how social media can use blockchain and Apple has already applied for a patent related to blockchain technology.
Amazon is also working on blockchain and offering related products. With its AWS platform which is one of the largest cloud computing platforms in the world, this could mean a boom in innovation and applications in the coming year. This will include the way data is stored, accessible and protected.
There are many applications for blockchain in addition to cryptocurrency, and companies are already exploring what they seem. The next year will see an explosion of more applications and the exploration of new ones at the same time.
5. Clearer tax laws
One thing is certain, and since the cryptocurrency increases in popularity, the fees will be part of the picture and they are already. For the most part, digital coins are treated as properties or virtual securities, but new tax laws will have to consider whether being paid in Bitcoin is like a stock option or falls within the more traditional income tax.
The key is that companies once converted Bitcoins into "hard currency" rather than retain them because they feared market volatility, and rightly so. However, as they expect it will increase in value and stabilize, some are holding onto it in huge virtual portfolio accounts. For IRS and others, the question becomes how and when virtual coins are taxed, and those laws will become clearer over the next year.
6. The exchanges will change
With the adoption of traditional exchanges for cryptocurrency and Bitcoin futures and increased regulation, currency exchanges will have to adapt to survive. This means that they will have to respect the same rules as the other exchanges and may have to change the rates to be competitive.
Even as cryptocurrency becomes more mainstream, it will become more a target for hacking and theft. The way people store cryptocurrency and the way in which exchanges are stored and kept safe will also change in 2019. Smaller exchanges can struggle to survive, and mergers and larger exchanges will likely become more common.
7. Stability will become a bigger factor
At the moment, any investment in digital currency is volatile. Money is made and lost in hours or days, not months and years, and stability is not guaranteed. Many coins offered this year are already trading well below their initial values and most will probably never recover.
The truth is that the currency market may not fully stabilize, but the coins that are well known and the most reliable investments will get some traction, and the ICO will encounter greater skepticism until the companies prove to be valid.
Part of this will come from more traditional regulation and trade, while others will come from investor demand and expectations.
One thing is certain, 2019 will be a year of changes for cryptocurrency and blockchain, and most of these changes will be for the better.
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