Russia and China to disrupt the market of cryptocurrencies in 2019
The other day Saxo Bank* published another portion of its “shocking forecasts” for 2019. Analysts predict a swift collapse of Bitcoin price in 2019 and the increasing influence of Russia and Chine on the market of cryptocurrencies. Among other things, they say that Europe is threatened with a new political crisis and the US dollar will lose its financial hegemony in the world. In a word, they say incredible things.
For my part, I am mostly interested in the future of cryptocurrencies. The pojection that Bitcoin will grow up to 60 000 dollars and then will fall to 1000 is not a new one. It seems, the first time I read something similar was last year and I am still waiting for it to happen.
On the contrary, the forecast about China and Russia’s growing influence on the cryptocurrency market is quite interesting.
I will begin, perhaps, with China.
The inhabitants of the Celestial were among the very first to become interested in cryptocurrencies. In just a few years hundreds of mining farms sprang up all over China and, before the country introduced restrictions on token sales, the lion’s share of all Bitcoin trading was in the yuan.
At the end of last year the country government banned ICOs and the circulation of cryptocurrencies, which led to the rumors that China was preparing to launch its own cryptocurrency. The national cryptocurrency is necessary for conducting international transactions bypassing the dollar. For quite a few years the government of China has been thinking of it.
The first precedent of a national cryptocurrency was the Venezuelan El Petro, whose sale started in February, 2018. Quite probably, this experiment will be repeated by China in 2019.
The situation in Russia is a bit different.
There are no talks about the creation of a national cryptocurrency as yet, even the question of market regulation is still pending. Nevertheless, almost 50 % of all world ICOs are launched in Russia.
To predict just how Russia can affect the future of the cryptocurrency market, we need to take a closer look at what is happening in the country.
Some guys from the FairWin team live in Russia, so I know a few things about the state of affairs there. So I think that some internal preconditions exist for a wider circulation and use of cryptocurrencies in this country. People in Russia, although it may sound strange, have got used to greater freedom than Europeans. Russians do a lot of business-related things bypassing the state. People get “grey” salaries, run small businesses without registering a legal entity and do not pay taxes. Now the state is starting to fight illegal small-scale business, self-employment and grey salaries.
This purpose is achieved by taxes on the transfer of large sums of money from one card to another, by allowing banks to withdraw money from the debtors’ cards without the owners’ consent or, for example, by imposing the law to attach a mobile telephone number to a passport (this idea is being discussed now).
Knowing the freedom-loving nature of Russians, it will lead to people searching other ways of conducting transactions behind the back of the state and banks. One of such ways is transactions in a cryptocurrency.
Therefore I think, that in 2019 Russia will see a significant increase in the circulation of cryptocurrencies, which will provide a powerful stimulus for the development of blockchain technologies. All of this will impact on the world market of cryptocurrencies.
Another thing is that, if the government of Russia starts to use cryptocurrencies for international transactions, it will most likely lead to a ban on unauthorised virtual money.
In this rapidly changing world even the most improbable forecasts can become reality. I think that some shocking events await the market of cryptocurrencies in 2019.
*the Danish investment bank Saxo Bank, specialising in online trading and investment in the international markets, publishes a yearly forecast about «improbable, but underestimated» events which can make a serious impact on the financial markets.
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