What was learned from cryptocurrency in 2017 and what to expect in 2018

In less than 10 years, cryptocurrency has evolved from being a fringe asset held by almost exclusively technology nerds to a globally-traded asset

1. Blockchain has passed the point of no return

Following last night's crypto-market crash, Kingsley Advani - Angel Investor - explains what 2018 will hold for the volatile cryptocurrency market

Blockchain technology reached a new level of global understanding, cementing its position as a viable technology to transform existing financial infrastructure. The wider public, corporations and governments began to adopt the technology, gaining an insight into the pace of blockchain development and its future potential.

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The media narrative on cryptocurrency changed drastically from “Bitcoin Bubble” to “Bitcoin – When to Buy”. Banks started to change their position on cryptocurrency with Goldman Sachs in December 2017, announcing plans to setup a trading desk exclusively for cryptocurrencies.

2. Cryptocurrency products became more accessible

In December 2017, two of the world’s largest futures exchange, CME and Cboe, launched Bitcoin futures. This new product improved investment access of cryptocurrencies for corporates around the world. The New York Stock Exchange filed to list Bitcoin ETFs in December 2017. This would allow traders to bet on the future of cryptocurrency in a simplified product.

3. Initial Coin Offerings are here to stay

The concept of the Initial Coin Offering gained momentum in 2017 as a viable means of raising capital for early stage technology companies. ICOs proved to be effective as a low-cost and high-speed alternative to raising traditional venture capital money.

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The velocity of Initial Coin Offerings increased dramatically last year, both in the number of ICOs and amount raised. Some of the largest ICO raises of 2017 included:

Status Network: $275,814,878

Filecoin: $257,000,000

EOS: $256,247,089

4. Governments want to work with cryptocurrencies

We saw a more pro-government stance to cryptocurrencies in 2017, with governments around the world seeing the greater potential of blockchain technology. In December 2017, Venezuela announced plans to issue its own digital currency, called the Petro.

This currency was designed to help the country become more independent from the international financial system. This trend is set to continue as countries with rudimentary financial systems and depressed economies look to blockchain for improved financial infrastructure.

A look to the future: cryptocurrency in 2018

1. There will be more institutional investment

In 2018, we will see large-scale institutional investment into cryptocurrencies. A string of new products will be released including Ethereum futures and a Bitcoin ETF.

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These products will make it easier for larger sums of capital to flow into the system. The infrastructure for high-volumes of capital is being built at an alarming speed with unprecedented demand.

2) Global adoption of cryptocurrency will increase

In 2018, the number of people who own cryptocurrency is predicted to triple. If we place current global adoption at 1% of humans on Earth owning cryptocurrency, we can see this increasing to 3% over the next year.

Drivers of this adoption will be both news spreading about the convenience of holding a digital store of value, and easier ways for the general public to access cryptocurrency as an investment class.

3) Larger corporates will issue their own cryptocurrency tokens

Recently, we have seen corporates including Kodak and Telegram launching their own cryptocurrencies. We will see a continuation of this over the coming year, with corporates issuing their own coins in a bid to modernise their technology and underlying economics.

>See also: Decrypting cryptocurrency and its widely held misconceptions

4. There will be more advanced decentralised protocols challenging Bitcoin and Ethereum

Blockchain technology was only released in 2008 following the “Bitcoin: A Peer-to-Peer Electronic Cash System” paper by Satoshi Nakamoto. There are many ambitious projects, including Hashgraph, that aim to improve on underlying blockchain technology. This will continue in 2018 with academic groups around the world launching their own blockchains in a bid to dramatically improve the architecture of the blockchain ecosystem.

In less than 10 years, cryptocurrency has evolved from being a fringe asset held by almost exclusively technology nerds to a globally-traded asset. Over 170 cryptocurrency funds have launched to invest exclusively in cryptocurrencies and early stage blockchain technology companies. It is fair to say that blockchain has passed the point of no return.

In 2018, it will continue to evolve, improving our society as a digital store of value and beginning to power the smart economies of the future.

Sourced by Kingsley Advani is an investment analyst specialising in blockchain research, cryptocurrency and personal finance. As an angel investor, Kingsley is passionate about early stage blockchains and has focused on deep analysis across cutting edge blockchains such as Zilliqua, NEO and Ethereum

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