The cryptocurrency landscape is rapidly changing. And that makes it both exciting and concerning for business owners, investors, traditional banking and financial institutions, regulators, and the average person who uses digital wallets.
To keep you updated and prepared for the next 12 months, here are the top cryptocurrency trends to watch out for in 2017.
Bitcoin Could Break the $ 1,500 Mark
Bitcoin had a very good 2016. And, this trend can be expected that to continue into 2017. Right now it’s a bit over $ 900. Juniper Research is actually predicting that the total value of Bitcoin transactions is expected to exceed $ 92 billion this year.
Bitcoin experts like Gil Luria of Wedbush Securities believe will once again double going from $ 600 in 2016 to $ 1500 in 2017. Luria is also predicting that that bitcoin’s price will double all the way up until 2025, which would mark an increase of 4,500. SpectroCoin CEO Vytautas Karalevicius anticipating that that bitcoin will rise to about $ 1800 to $ 1900.
So, what’s driving this growth?
Daniel Masters, a co-founder at the multi-million dollar bitcoin hedge fund, believes that it’s because bitcoin adoption will continue to increase, as well as more companies beginning to accept bitcoin as a payment.
Vinny Lingham, the CEO of Civic, states that this boost is due to venture capital investments in bitcoin and blockchain technology having topped a billion dollars and that there will be natural inflation due to its limited supply.
Quantitive Easing and Governments Test-Driving Ledgers
Japan and the Eurozone have been engaging in quantitative easing, which is simply described by the BBC as “pumping money directly into the financial system.” Doing so increases inflation and encourages people to invest in things like bitcoin.
Furthermore, countries like Japan are test-driving public ledgers. Deputy governor Haruhiko Kuroda recently said;
“Accordingly, the staff in the Payment and Settlement Systems Department of the Bank are deepening their understanding of such new technologies by test-driving distributed ledgers. Note that these trials by the Bank’s staff simply aim to understand the mechanics of DLT, rather than applying it to the Bank’s own liabilities or its payment and settlement systems.”
Earlier this year Kuroda stated that the blockchain had the ability to reshape some financial processes, and even called on other central banks to conduct research like the Bank of Japan has undertaken. In fact, Canada, the UK, and Singapore have answered the call.
Expect more countries to start looking into the benefits of cryptocurrencies like transaction settlement and financial monitoring.
Enforcing Cryptocurrencies Will Continue
Speaking of government intervention, don’t expect virtual currencies to become a priority. However, agencies like the U.S. Securities and Exchange Commission (SEC) and U.S. Commodities Futures Trading Commission (CFTC) will be paying attention to bitcoin.
Other agencies, such as is the New York Department of Financial Services (NYDFS), which debuted its BitLicense regulations in 2015, will also be keeping an eye on the emerging cryptocurrency developments in 2017.
The Potential of the Blockchain Will Be Recognized
For those unfamiliar with the blockchain, it’s the technology that bitcoin, and other distributed ledger systems, are based-on. It was originally envisioned to change the way securities and cross-border payments were settled. However, banks, exchanges, and other financial services have been using the blockchain for its digital currency capabilities.
Although in 2017, more people will begin to realize the benefits of the blockchain outside of virtual money. This includes enabling point-to-point transactions without having the need for intermediaries. The blockchain can also enhance smart contracts so that it will be possible to automatically issue digital securities and trade financial derivatives.
Introducing the ‘Blockmarket’
The Syscoin project, which has been building a decentralized marketplace since 2014, is expecting a major release in early 2017. It’s called the ‘blockmarket.
Dean Walsh, the founder, editor, and lead writer for Cryptorials, says that this is “a white label store front that will enable anybody to create a web-based front end to the marketplace.” Walsh believes that this could be a great investment opportunity.
The ‘blockmarket’ won’t just be for sellers. The company behind the marketplace claims that it’s “the first step towards an entirely re-designed wallet experience, including the desktop and a full-featured mobile wallet as well.” Syscoin plans to release both a desktop wallet and mobile wallets for the mainstream as well.
Besides Syscoin, expect more and more organizations, such as my company Due, are assisting new users who have been cautious about cryptocurrencies, by enhancing their products and actively promoting their benefits.
There Will Be Trade-Offs
During her excellent TED talk regarding the future of money, Neha Narula says, “We’re entering a new era of programmable money. And it’s very exciting, but it’s also a little bit scary.” Cryptocurrencies can be used for illegal transactions, as is cash, but more frightening, will be answering questions like “who can see what we do?” or “Who’s advantaged in this new world and who isn’t?” Will I have to start to pay for things that I didn’t have to pay for before? Will we all become slaves to algorithms and utility functions?”
“All new technology comes with trade-offs,” Narula adds.
“The Internet brought us a lot of ways to waste time. But it also greatly increased productivity. Mobile phones are annoying because they make me feel like I have to stay connected to work all the time. But they also help me stay connected to friends and family. The new sharing economy is going to eliminate some jobs. But it’s also going to create new, flexible forms of employment. With programmable money, we decouple the need for large, trusted institutions from the architecture of the network. And this pushes innovation in money out to the edges, where it belongs.Programmable money democratizes money. And because of this, things are going to change and unfold in ways that we can’t even predict.”