Blockchain’s Top Trends of 2019
Each year it seems we redefine what blockchain means to the world. Each year we mature in our concept surrounding smart contracts, distributed ledgers and the creative communities of developers and supporters we are building. The manifold projects and the myriad of products using blockchain technologies continues to grow, and we expect this indeed to be the case in 2019.
One month ago we brought to you Crypto Trends of 2018, in this article we’ll be focusing more on Blockchain itself.
When we founded the WOM Protocol, we conceived of an ecosystem that would be built on sharing, honesty, authenticity and decentralized applications (dApps).
Blockchain Optimism Lives
It’s very easy to give in to mainstream pessimism surrounding certain aspects of cryptocurrencies or even blockchain adoption altogether.
There’s a lot of media angles both pro and con. Yet the market and the ecosystems defy odds and crypto projects also provide new visions of the future for all of us.
Ultimately, these will enhance our online journeys, provide convenience, and also improve our trust that technology should be ethical and provide new solutions.
While bodies like the SEC help to define in a legal sense what “sufficient decentralization” might mean; entrepreneurs, developers, investors and users are tirelessly participating in cryptoeconomic propositions for a better world, a more complex world of digital interactions. Here are some of the trends at the intersection of blockchain and cryptocurrencies that stood out for us, our team and our editors.
1. The Emergence of Blockchain for Social Good
2019 will see huge momentum for blockchain at the service of new economic models, NPOs and social entrepreneurship initiatives. The rise of blockchain technologies has given a boost to social good project. These are broadly speaking projects that impact our the common good. Blockchain for social good is a rising trend.
2. The Decentralization of Creativity
The world needs decentralized skill-sets. What do we mean by this? LinkedIn in 2019 says “creativity” is now the most in-demand skill. From how we share content, products or inspiration online, to how we collaborate across disciplines, in a world rapidly being transformed by artificial intelligence and IoT, human creativity still trumps all else. Blockchain startups are building new frameworks for communities, online interactions, and partnerships that can stimulate creativity in business, government, and among massive groups of people.
When a young person becomes an influencer online adding value to a niche audience and creating videos, they are embodying a new generation of creativity online.
3. The Rise of Mainstream Digital Asset Marketplaces
The adoption of cryptocurrency exchanges over the last twenty four months has been rapid, and has given blockchain another avenue of expression and this trend towards digital asset trading, exchange and value storage, has new momentum in 2019. Namely platforms like Bakkt, Circle, Coinbase, Binance, Robinhood and Fidelity Digital Asset Services among others will lead to more mainstream adoptions and use cases for tokens.
4. Blockchain-As-A-Service Gains Traction
In 2019 we expect BaaS to mature rapidly and centralized blockchain experiments and decentralization and dApp development to coexist in a more mature way. It would be modest to estimate that by 2023, BaaS could produce nearly $13 Billion, according to a new report from ABI Research in late 2018. In fact, the interaction of blockchain and the cloud scales quite nicely moving forwards into the 2020s.
5. FinTech & Payments are Evolving Fast
In 2019 companies like Stripe, PayPal, Square and FinTech companies are doing incredibly well, however even as mobile payments has taken over in places like China, Blockchain can facilitate a new era of micro-payments and the evolution of the Lightning Network (Bitcoin) will be one to watch. The very interface of how consumers can interact with cryptocurrencies in app, online or in brick-and-mortar environments is set for a revolution and is accelerating exponentially.
6. Blockchain Consortiums are Growing and Establishing New Momentum
In crypto you have micro communities around different blockchain startups, however the these Blockchain consortiums and events are also scaling in ways that aren’t reflected in the price of Bitcoin or Ethereum. The emergence of blockchain consortia is impacting innovation on the ground, and how developers, students and businesses around the space collaborate and form new blockchain startups and partnerships.
7. Banks and Use Cases of Centralized Blockchains
Ripple, which was founded in San Francisco in 2012 and has since had success working with major banks could be in the spotlight in 2019 as Financial investment and Wall Street’s participation in digital assess increases.
With improved regulation and a transition of even how blockchain startups get access to funding appears to be shifting from crowdfunding towards digital asset offerings (DAOs) or security token offerings (STOs), there’s a consolidation taking place.
While many crypto funds came into being in 2018, their viability has been impacted by dips in the crypto markets. In the history of blockchain, 2019 might be a year where centralized blockchains comes more to the fore as decentralized public blockchains work behind the scenes to solve scalability.
8. Institutional Investors Pour Money into Blockchain Startups
While utility tokens and ICOs saw a lot of public funds from smaller investors and the enthusiasm of the crowd, it’s expected security tokens could fast-tracker the participation of larger investors that could stimulate more validated innovation where talent from the Financial world in 2018 migrated to promising blockchain startups.
If Utility tokens offering (and ICOs) and their usability were’t simply substantial enough to investors, who are used to buying stakes in companies, STOs (security token offerings) could improve the reliability of success rates of a new generation of altcoins and their value propositions in the 2020s. This “second wave” of blockchain investment, would not be the wild-wild-west of crypto but a much more measured approach to blockchain innovation.
9. Digital Assets Branded as a New Asset Class
With new platforms coming into being from the financial world, altcoins will be re-branded as digital assets as “crypto” was considered too controversial by some. For Wall Street and the likes of CNBC or Bloomberg in how they cover cryptocurrencies, the name ‘digital assets’ sounds more professional. While the compromise of having Bakkt and others take marketshare away from existing cryptocurrency exchanges is there, the opening up to global markets of investors could provide an infusion of capital that could help scale blockchain startups and the mainstream manifestation of the digital token economy.
The second-coming of crypto would be more legitimate to older investors who for the most part may have not been on the side of younger crypto enthusiasts in the initial hype of Bitcoin or even Blockchain.
10. Blockchain’s Evolving Proof of Concept
As blockchain startups continue to find product-market fit, the vast applications of distributed ledger technology and blockchains continues to evolve. Blockchain encompasses projects in finance, crypto, apps, decentralized apps, enterprise segments, the Cloud, public blockchains, enterprise blockchains, and so forth. In 2019 the very tenets that blockchain provides digital value is sure to increase.
Just as the Cloud, or machine learning or consumer products mature, so too is blockchain moving from a nascent phase to a pre-mass adoption phase of its business & innovation cycle. Blockchain’s use cases must reach a critical mass before it can be said that blockchain has achieved mainstream adoption and we are most likely years to fast-moving decades until that occurs.
11. Signs the Token Economy could replace Advertising on the Next Web Manifest
If digital assets mature and cryptocurrencies go mainstream, it could mean the end of digital advertising as we know it. Instead of targeted Ads that consumers dislike, the internet would instead be personalized based on incentives tailored to each person on the planet in a data and attention based economy.
One of the most radical tenets of decentralization would be an internet that serves all global citizens equally without benefiting centralized companies and or enforcing authoritarian Governments over the human rights of citizens. This would imply that blockchain achieved a harmony of a merger of the financial global system with overlapping cryptoeconomic mass-scale for users, audiences, creators, curators and citizens alike. An Ad-free internet is potentially one of the end-games of mature blockchain.
12. Blockchain Divisions in Corporations, Banks and Enterprise Mature
With an inevitable crypto winter taking hold of cryptocurrency markets, 2019 is a period where blockchain divisions in large scale tech, banking, FinTech and media companies can test products that utilize distributed ledger technology and have “their turn” to impact the product-market fit of their own conceptions of how to utilize blockchain in their business model.
An example of this is potentially a stablecoin operated by Facebook’s blockchain division that could be trialed on WhatsApp. As companies like Coinbase, Binance and Bitmain mature, so too do the blockchain divisions of companies such as Alibaba, IBM and even central banks of countries that plan to test their fiat currencies in a digital form on centralized blockchains.
13. Models of Decentralized Governance are Implemented
One of the main challenges of the opt-in to true blockchain adoption is the necessity of a decentralized governance structure. Many blockchain startups neglect, fail or unable to implement such a system and result in their failure to scale, innovate and create products of value to their intended niche, industry or market. As blockchain matures and adoption increases, models of how decentralized governance can be implemented is a critical organizational and human leadership component that in 2019 will increasingly come to the fore.
14. Blockchain as Supply Chain Transparency
For existing logistics and supply chains, the idea that blockchain would enable how we trace goods as end-consumers was one of the more realistic implementations. In 2019, expect this to mature via companies such as Walmart, Alibaba, IBM, Huawei, Nestle and dozens of others. If blockchain is to augment consumer trust, traceability and transparency are key for the end-consumer in supply chains. Mature blockchain is widely anticipated to improve trust, security and convenience.
15. Blockchain Integration Becomes a Competitive Advantage for Newer Startups
New startups recognize that blockchain is yet another technology they can integrate with and will be more agile than legacy enterprise companies in adoption blockchain. Over time this becomes a competitive advantage as new business models sync with cryptoeconomics, blockchain adoption and the potential advantages of being blockchain compatible or dealing with altcoins. Fast growth startups will implement practical and ideological aspects of blockchain, crypto and decentralization to fast-track how they scale and to augment both customer acquisition and customer retention. A good example of this in 2018 was the Robinhood app.
16. Acceleration of the Importance of Blockchain Hubs
Locations such as Malta, Singapore, Berlin and Zug (Switzerland) in 2018 saw blockchain developers and startups flourish due to regulatory and blockchain innovation hotspots. With regulation and crypto friendly laws vastly different in different areas of the world, the emergence of cryptoeconomics and blockchain innovation in certain areas over others appears to be accelerating in 2019. In particular, Asia is winning the race to blockchain innovation. Singapore, South Korea, Japan, Thailand and parts of China appear as bright spots for the 2019–2024 period.
17. Nascent Blockchain Industry Fueled by Startup Accelerators
As blockchain startups outgrow the legacy of crypto winter, major blockchain startups accelerators begin to mature reliably picking the winners of promising tech startups in the space and helping them scale over a sea of altcoins, projects in limbo and code death where the success rate challenges even the most enthusiastic of entrepreneurs. For instance Binance Labs hosts an incubation program, that is a 10-Week On-Site program designed to help top early-stage teams to deliver a product/service with a Product/Market fit.
18. Emerging Sectors Introducing Blockchain Proliferate
From STOs to self-sovereign identity and online identity management via blockchain technology, what once seemed like visionary applications of blockchain tech quickly become reality in 2019. From tokenizatoin in real-estate to advances in decentralized identity to how stablecoins can be implemented in the real world, some of the latest products in the blockchain space are some of the most impactful and pragmatic.
19. Hybrid and Increased Interoperability Between Blockchain
Hybrid blockchains attempt to bring together the best of both worlds and features of centralized and decentralized blockchains. Enterprises and governments require totally centralized and private blockchains, while introducing features that are more user-centric. Blockchain interoperability aims to improve information sharing across diverse networks or blockchain systems and is further needed to consolidate data on a hybrid-IoT blockchain web.
Stablecoins that themselves are tethered to real-world fiat prices, can further more increase real-world adoption of crypto, since they have one foot in both economic worlds. Blockchain ecosystems need to be compatible and in 2019 we can expect progress on how centralized and decentralized systems can work together in a more interconnected way as cryptoeconomics matures.
20. Ethereum 2.0 Takes Place and Competitors Rise
In 2019 a lot of work will be done to make Etheruem a scalable public blockchain. In the time being several competitors will emerge implementing 3rd generation blockchains that could gain momentum to one day challenge Ethereum. The usual suspects from 2018 are EOS, NEO, Stellar, Cardano, Waves, Tron and others.
However, a new class of competitor is rising with considerable VC backing including the likes of Dfinity, Harmony Protocol, Nervos as well as relative newcomers such as Tezos, Qtum and Zilliqua. In 2019 we can expect the scalability problem for public blockchains to continue to moderate crypto prices. Here there could be unexpected newcomers and winners.
21. China Leads Blockchain Regulation
Many analysts believe if a central bank decided to put their fiat currency on the blockchain, the Yuan would be first. While the SEC appears relatively slow to regulate, China is much more decisive with regards to blockchain and crypto regulation.
The Cyberspace Administration of China (CAC) has introduced new regulations for blockchain firms that are operating in the country. The announcement was published on the regulator’s website on Thursday, Jan. 10.
Accordingly, China’s internet regulator, the Cyberspace Administration of China(CAC) in a detailed document outlined a final draft of regulations concerning cryptocurrency and blockchain companies. The rules will come into effect starting February 19, and provide a set of guidelines that blockchain companies are required to follow.
From anti-anonymity regulations to how to structure the blockchain innovation sector, China understands the importance of funding blockchain and making sure rules are followed.
22. The DEX will Evolve in 2019
A DEX is a decentralized peer-to-peer exchange that requires no centralized exchange to act as a middleman and instead runs on code. For instance Binance will beta launch its DEX in 2019.
A community-driven decentralized exchange could change the way we conceive of how trading, purchasing and the exchange of digital assets could take place in the future. At the intersection of blockchain & decentralization, the evolution of DEXs is sort of a big deal. Consumers may end up preferring DEXs since they may result in lower transaction fees, improved anonymity, absence of a third-party and be closer to the peer-to-peer decentralized model of the original spirit of Bitcoin.
23. Asset Tokenization will go More Mainstream
For a token economy to take place, how we think of the connection of real world objects and assets and tokens will also blur. Asset tokenization is a field that is showing potential to scale faster in 2019. Tokenization is a method that converts rights to an asset into a digital token.
Real world assets and objects on blockchains have certain advantages and could even lean to communal management that places a greater emphasis on a dynamic sharing economy. In theory, a token could represent a particular percentage share of any underlying asset in the physical world.
Think of our corporeal world on the blockchain, it’s full of assets, stuff and possessions: stocks, real estate, gold, carbon credits, oil, etc. Now imagine having a share of digital assets such as data, patents, music, internet traffic, etc…
24. Convergence of Blockchain, IoT and AI
The march of the Cloud is very well the story of how enterprise businesses add new features that help manage their businesses and make them more profitable. Blockchain adoption also depends on its integration with the Internet of Things, machine learning and the slow but sure advancement of artificial intelligence: that’s the very notion of technological progress in the 21st century.
If blockchain-as-a-service gained momentum on the Cloud in 2018, in 2019 blockchain supporting the internet of things and consumer-AI is a distinct possibility. What would a more decentralized Alexa look like? Sending crypto via Amazon Alexa in a voice command is already possible. Blockchain startups that focus on the intersection of IoT and AI could show a lot of importance in the future. However as we have seen with hype terms such as Blockchain, IoT and AI, these are slow moving waves that are impacting consumerism and capitalism very broadly top-down and bottom-up.
This is not a final list, and check back as we continue to add to it. Comments on suggestions appreciated.
