As Bitcoin Officially Turns 10 Years Tomorrow, Here’s the Top “Hodlers Hopium” Outlooks for 2019
With 2018 being officially done and gone, many in the crypto community are left wondering what is next. A lot was left unresolved, with the crypto market situation still being anything but stable. So far, the new year has started on a positive note, and a large part of the crypto market is currently seeing gains. Even so, this is nowhere near the bull run everyone was expecting to arrive.
While eventful, 2018 did not promise a bright future for the crypto space. Of course, there are several things to hope for, such as the potential approval of Bitcoin ETFs, and the launch of Bakkt exchange. However, these events were postponed several times by now. Meanwhile, the drop in prices damaged the market, and the coins' value still remains down. ICOs died out, and no 2017-like bull run was in sight in late 2018, despite all the hopes.
It is safe to say that 2018 was quite a bad year for crypto, which mostly revolved around correcting the market after the hype allowed crypto to blow up in 2017.
However, many now believe that this part of crypto history is over and that the new, better times are upon us. With that in mind, let's see what the biggest hopes for 2019 regarding the crypto world are, and how different events may affect it in the following months.
Can Stablecoins Save Crypto?
Considering how big of a problem high volatility has become in the crypto world, many have opted to turn to a more stable alternative. This is why stablecoins — fiat pegged cryptocurrencies — managed to take the stage in 2018. However, the volatility of the crypto space continues to persist, and because of that, stablecoins are gaining more and more influence.
Thanks to the fact that each coin is backed by a certain amount in fiat currency (for example, 1 coin = $1), they are much safer to invest in and use. In a way, stablecoins are the best of both worlds. They can use the stability of fiat money while still providing all the benefits expected from a typical cryptocurrency.
They are not always entirely successful, and in 2018, one stablecoin, in particular, came to light. Tether (USDT) became popular very quickly, but it soon became a center of a controversy after its parent company consistently failed to provide evidence that the circulating USDT is actually fully backed by USD.
However, while Tether may have lost a large portion of the investors' confidence, other stablecoins such as USDC, GUSD, and alike are still very popular and appreciated in today's crypto space.
Institutional Investors Approaching Crypto
Another big issue with cryptocurrencies is the lack of institutions and institutional funds. Typically, institutional investors can provide a lot more money to the object of their investments, and while the crypto world managed to survive for an entire decade without them, it is becoming clear that the next stage in crypto evolution will require institutions to join in.
So far, these investors were interested, but hesitant when it comes to actually joining the space. Many experts believe that the problem does not lie in high volatility, as initially believed, but in the security of the space, and the lack of firm regulations. Institutions know how to handle risks, but they are not willing to invest in an asset that can be stolen from them by hackers with decent skills.
Numerous incidents revolving around hacking attacks have already stained the reputation of crypto, which is supposed to be a safe and reliable currency. However, the lack of regulations makes exchanges an easy target for those who know how to exploit their weaknesses.
To combat the issue, crypto enthusiasts came up with Bitcoin ETFs, which are still waiting on the US SEC's approval. The decision was already postponed several times by now, and it is currently scheduled for the end of February 2019. If approved, institutions will no longer have to own crypto to invest in it, which takes away a massive portion of the risk involved in investing and trading.
Furthermore, a Bakkt exchange is another project that is expected to show investors that trading crypto is an excellent way to make a profit. Bakkt is to be an exchange that will allow trading physical Bitcoin contracts, and it is expected to launch in January 2019, after being delayed as well. Due to these and similar projects, many institutions that have initially dismissed Bitcoin are starting to have a change of heart, and are now interested in joining the space, if certain conditions are met.
Big names like Nasdaq and Fidelity are allegedly heading towards the crypto industry, and with their influence, additional institutions might follow relatively soon.
Finally, the surge of 2017 and problems experienced in 2018 have shown how necessary it is to regulate the crypto space properly. As a result, regulators and governments around the world attempted to tackle the issue, but only a few of them have had any success while doing it.
Regulating crypto has become even more critical after developing and sanctioned countries started considering going crypto as a way out of their difficult situations. One of the biggest examples of this is Venezuela, which even launched the first state-backed coin in crypto history — Petro. So far, however, Petro did not manage to fulfill the promises that were made, and the coin remains highly controversial.
To avoid similar problems, the rest of the world realized how desperately crypto regulations are needed. So far, Japan and South Korea had the most success in regulating the crypto space, while the rest of the world still struggles with creating proper regulatory frameworks. Some countries, such as India, seemingly gave up on trying, and their banks were ordered not to engage with crypto-related businesses.
Meanwhile, in the US, the legitimacy of crypto remains controversial in its own right, and while there are many supporters of the new cash form, the SEC is still struggling with handling the demand. Another big event that came only a little over a week ago happened on December 24th, when two US Congress members proposed a bill which will result in excluding crypto from being defined as securities.
After an eventful 2018, it appears that the current year will be no less exciting when it comes to possibilities of the crypto world. A lot of changes are expected to arrive, although their impact on the space is still debatable, and likely wholly unpredictable. In any event, there are things to look forward to in this year, as it might be the first one where crypto will start gaining serious recognition.
Also, it might even start seeing the recovery of the crypto market, and after bearish 2018, there is a lot of recovery to be done.