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In the last few years the cryptocurrency landscape has been constantly shifting, and new trends seem to emerge on a daily basis. Of course some trends have a much bigger impact than others, and may even play an important role in determining the shape of cryptocurrency for years to come.
Throughout 2019 there have been a number of important trends that have emerged – and that you should definitely be aware of.
Introduction of Stablecoins
Stablecoins are an important new development in the world of cryptocurrencies. Unlike conventional tokens, stablecoins are pegged to another asset or currency.
The more popular stablecoins such as Tether, Gemini Dollar, and USD Coin are all pegged to the US Dollar. However there are others that are pegged to different currencies too such as the Euro.
Because stablecoins are tied to real assets they are theoretically more stable, and less prone to volatility. That is what makes them an exciting prospect for the future growth and development of cryptocurrencies.
Big-Name Corporate Tokens
Throughout 2019 several corporate giants announced their plans to venture into the cryptocurrency world and come up with their own tokens. The most notable right now are Libra by Facebook, JPM Coin by JPMorgan Chase, and the yet-unnamed ‘Samsung Coin’ – all of which are expected to be launched in 2020.
If initial reports are true, these corporate tokens should all be stablecoins – and will be tied to real assets. Compared to other recent cryptocurrencies their scale is bound to be much bigger, which may allow them to gain mainstream popularity.
Clearer Regulatory Standards
Regulation and oversight are sensitive topics in the cryptocurrency world, but are slowly starting to be viewed as a necessity. Throughout the course of 2019, regulatory standards have become clearer in order to improve safety, transparency and stability.
Of course regulatory standards still vary significantly from one country to the next, which can make things complicated. Ideally in the years to come are more uniform approach will be adopted.
At the same time self-regulatory technology is an emerging trend that may end up defining the role of oversight in the future. It utilizes artificial intelligence to apply accounting practices to cryptocurrencies.
Increased Retail Adoption of Cryptocurrency
The number of retailers accepting cryptocurrency payments has grown steadily from year to year, and 2019 is no different. In fact the growth of retail adoption in the US and Europe has risen sharply this year.
In other parts of the world the adoption is still relatively low. That being said many major cities in Asia have started to see growth, and that trend will probably continue in the future.
As more stablecoins are introduced and become more popular, the retail adoption of cryptocurrency should skyrocket again. The launch of Facebook’s Libra may help provide a significant boost too.
Less Volatile Market
All in all 2018 was a rough year for cryptocurrency, and the aftermath of the crash that took place is still present. However ever since then the cryptocurrency market has been less volatile, and appears to have matured and become more stable.
While there are no guarantees that the cryptocurrency market will continue to remain stable, it is definitely a lot less unpredictable than it was in the past. That is partly due to the fact that many of the more popular cryptocurrencies such as Bitcoin have already matured.
Rise of Decentralized Exchanges
Decentralized exchanges may still be a work in progress, but they are definitely a trend that you should pay close attention to in the future. In theory they perfectly complement the decentralized nature of cryptocurrencies, especially in contrast to the current centralized cryptocurrency exchange platforms.
Already several major players have started to invest heavily in building their own decentralized exchanges, and more will probably do so in the future.
The need for decentralized exchanges is partly due to the numerous high-profile hacks of central exchanges that have demonstrated just how vulnerable they can be. However before decentralized exchanges can be viable they will need to become much more intuitive and iron out many of their current issues.
More Security Token Offerings (STOs)
Over the course of this year there seems to have been a shift towards STOs. If it continues they may even replace Initial Coin Offerings (ICOs) completely.
Unlike ICOs, purchasing STOs is very similar to a conventional securities investment. In other words it will be as though you’re buying shares, and you will receive benefits accordingly too.
The main advantage of STOs is that they are regulated. That makes them a safer option for investors, and one that is less likely to be a scam. On top of that the value of STOs is tied to actual financial assets, which should make them more stable.
Bitcoin Continues to Play Major Role
After the 2018 crash many people questioned whether or not Bitcoin would continue to play a major role and exert influence over the price of other cryptocurrencies. If anything 2019 has proven that it still does.
It is true that Bitcoin is no longer as dominant as it once was in the past, but it is still the most popular cryptocurrency by far – and the most recognizable too. Because of that its price fluctuations still ripple across other cryptocurrencies.
The biggest challenge to Bitcoin may come from new big-name stablecoins such as Libra. However even after they are launched it will probably be several years before they are able to supplant Bitcoin completely.
Final Words
Keep in mind that cryptocurrency trends come and go – and there is no guarantee that the trends of 2019 will continue to play a big role in the upcoming year. As new innovations emerge, some may even be replaced completely or simply fail to gain dominance.
For now the eight trends highlighted above are definitely important however, and you should keep tabs on how they progress. At the same time it wouldn’t hurt to also look into other new trends that have strong prospects.
