Much has changed since 2009, the year that Bitcoin first hit the scene and started a revolution. For 2020, the pieces are beginning to fall into place for what could be an important year in the future of digital assets and cryptocurrency. Here are our top 5 predictions for crypto in 2020.
1. The end of the ICO era
One of the most important hallmarks of 2017 was the ICO boom. During this time, countless multitudes of new projects launched and tried to secure funding through an initial coin offering, or ICO — including Celsius Network.
Many of these projects have since folded or are otherwise no longer in operation by any reasonable measure. Some, however, are thriving to this day and are still on the rise. 2018 saw a huge decline in ICO interest, mostly because such a large number of projects that sought funding during the boom of 2017 failed or otherwise didn’t show much in terms of results.
Further, an increased amount of legal pressure from various world governments put a leash on the ability for projects and companies to engage in an ICO. Lastly, the number of fraudulent ICOs that were seen in the last two years likely shook investor confidence in the concept altogether, further reducing interest in the funding style.
Our prediction for 2020 is that this downward trend will likely continue, and we will see fewer and fewer ICOs, as well as a decreased interest in them. Instead, we predict that more crypto companies will seek their startup funds through more traditional routes such as angel investors and classical venture capitalism.
2. Bitcoin: The new stable coin
The last few years saw bitcoin prices swing wildly up, then down, then up, then down again. But for a large part of 2019, bitcoin has seen an unusually high degree of stability as compared to the last 24 months. It seems as though bitcoin is holding steady at roughly the $9,000-10,000 mark. When prices drop somewhat, it appears that bitcoin buyers are eager to dive in on the apparent discount, thus restoring prices to the $9–10k mark.
We expect that as assets like bitcoin continue to mature, their prices will level out over time and wild swings will mostly be a thing of the past. Of course, there is no way to say with any degree of certainty what prices will do in the near term. However, as bitcoin is the most mature cryptocurrency, it stands to reason that it will continue to demonstrate that maturity by holding a much more stable price range in comparison to younger assets.
3. The ending of the boom-bust cycle
Keeping in theme with bitcoin’s recent stability, we are predicting that 2020 will be a year that lacks major market booms or busts. While there will always be price movements, we suspect that the crazy swings in price that we saw in 2017 and 2018 will not be repeated in 2020. As bitcoin prices have shown enhanced stability in the last few months, all of the other top altcoins are similarly showing a high degree of stability. Litecoin, for example, has been regularly hovering around the $60-$75 range, and Ethereum has been seeing its asset, ETH, close to the $200 mark.
If prices do change significantly over the course of 2020, it is our guess that such movement will occur gradually and not rapidly.
While this may seem to be a negative for those that want to cash in on the rapid swings, the truth is a more gradual and predictable market will be good for cryptocurrency in the long term. This is because a more predictable market will make it more attractive for more conservative investors — such as investment firms, retirement fund administrators, and so on. Slow and steady growth looks a lot more attractive than a price doubling, then halving, then doubling, and then halving again.
Extreme volatility to those not familiar with bitcoin and other digital assets makes them look more like a fraudulent scheme than the future of money. It is our opinion that slow and steady growth is what will win the race in the long run, and 2020 should be the beginning of that.
4. The end of “altcoins”
As the market continues to mature through 2020, we suspect that terms like “altcoin” will begin to fall by the wayside.
The term appeared in the early days of cryptocurrency when the first wave of bitcoin clones hit the scene. These early clones were often just that — clones — and offered nothing innovative or compelling. In the case of many clones, a programmer would duplicate the open-source bitcoin code, change a few things, give it a new name and release it onto the market.
Today, however, there are far too many viable, realistic, and proven cryptocurrencies besides bitcoin for us to continue labeling them as “altcoins”. By 2020, we think that the future key players in cryptocurrency will have continued to solidify and strengthen their market and user base to the point that they no longer need to be compared to bitcoin in order to be understood.
It may take the general public a bit more time to catch up in this regard, but those that follow the cryptocurrency community closely will likely no longer require this distinction or comparison. Instead, we think that Litecoin will be Litecoin, Ether will be Ether, XRP will be XRP, and so on.
5. Crypto will grow, but mostly behind the scenes
2019 has so far seen a veritable wave of interest and investments into crypto from big players.
According to a recent statement from Coinbase, there Coinbase Custody program — a service intended to securely store digital assets for commercial and government sized entities — is seeing hundreds of millions of dollars worth of cryptocurrency deposited into the service each and every week.
While the entire cryptocurrency market may represent many billions of dollars, these amounts of money are nothing to scoff at. On the contrary, what we are seeing is the collected fortunes of untold thousands of private and public investors being moved into digital assets quietly and somewhat inconspicuously. While Coinbase obviously does not release the identities of who is making these deposits, these entities themselves are also not readily shouting from the hilltops what they are doing.
As the cryptocurrency market continues to mature, it seems inevitable that more major players will get involved by simply buying and holding digital assets that they believe have a future. This behind-the-scenes growth could be one of the main drivers for price stability in the future. For example, if asset prices drop 5% to 10%, these institution-sized buyers could take advantage and increase their holdings at what could be considered as a discount. This buying action could then restore prices to where they were previously, enforcing market stability.
While adoption of assets among the consumer class is growing, we suspect that most of the growth will be seen not by retail shoppers or by individual HODLers but instead by major players acting quietly and behind the scenes.
What’s your take? Where is crypto going in 2020 and beyond? Let us know in the comments below.
About Celsius Network
Celsius Network is a democratized interest income and lending platform accessible via a mobile app. Built on the belief that financial services should only do what is in the best interests of the community, Celsius is a modern platform where membership provides access to curated financial services that are not available through traditional financial institutions. Crypto holders can earn interest by transferring their coins to their Celsius Wallet and borrow USD against their crypto collateral at interest rates as low as 4.95% APR.
Download the Celsius Network app and start earning interest on your crypto today ➡️ celsiusnetwork.app.link