Blockchain and Cryptocurrency 2019 Predictions – Vol. XXI

News | January 8, 2019 By:

We continue our series of predictions from the industry’s thought leaders on what may happen in the coming year. 

By almost any measure, 2018 was a challenging year for the blockchain/cryptocurrency industries. Beyond the usual issues facing young businesses in hiring, marketing, technology and financing, companies were engaged in a crisis of confidence with investors, as the crypto markets lost 80 percent of their overall value from the beginning of the year.

Add to that the magic fountain of funding caused by the curtailing of initial coin offerings, increased government scrutiny and outright bans of certain activities, and the bitter battles between technology developers that caused market gyrations, and it’s amazing that any company survived such severe headwinds.

But heading into 2019, the survivors of this industry wide winter are showing faith in the underlying technology of blockchain and the continuing promise of cryptocurrency. They point out that institutional investors are still on the sidelines, and many retail backers are still not in the game in any huge way.

Add that to the continued interest of big businesses and the spirit of innovation shown by blockchain and crypto pioneers, and the story looks a lot brighter than mere numbers would suggest.

Block Tribune asked thought leaders in the industry for their takes on what may happen in the coming year. Now through the end of the month, we’ll spotlight their thoughts on what may happen in what all hope will be a happy and prosperous 2019.

Shawn Douglas, CEO, Amberdata

BLOCK TRIBUNE:  Where do you see bitcoin heading in 2019 and why?
ANSWER:  Ultimately, I see bitcoin recovering in 2019 and am very bullish long-term. The fundamentals have not changed despite the multiple forks and obvious centralization of some of the smaller forks which have exhibited some unsavory behavior.
BLOCK TRIBUNE:  Have recent crypto plunges affected your outlook and/or plans for 2019?
ANSWER:  The absolute cratering of the crypto markets has been painful for all involved however, I believe long-term its good for the industry. Many funds had been investing on sentiment and hype and not doing the diligence traditionally done by early stage investors.  Some of the early token investors facilitated pump and dump schemes where the funds, exchanges and media companies where all owned by the same players.  The money was made in the pre-sale and passed to the public quickly in the public sales as they exited. This isn’t good for the projects who have to vest nor the late buyers as their investments sank in thinly traded markets.  People need to understand that early stage investing is a high-risk game which requires endurance and perseverance to build large outcomes. Most startups fail even after raising venture money. Token investors should have expected to see 70-90% of projects fail, as this is what angel investors often see in Seed investments.  Irrational exuberance drove a bubble as did it in internet 1.0 IPOs.  I believe we are now seeing investors with longer time horizions and views enter the markets and the best days are ahead of us.  The opportunity presented by decentralization via blockchain projects is larger and potentially more disruptive than anything we have seen since internet 1.0.  Look out at the possible for crypto on a 10+ year horizon. Then place bets being data driven.
BLOCK TRIBUNE:  What role will stablecoins have in the market in 2019?
ANSWER:  Stablecoins are in favor because the markets have dropped 95% and people are seeking safety to protect themselves from the bear market.  Volatility was not an issue when the markets where going up. There are lots of examples of countries pegging their currencies to stronger currencies to reduce volatility, those usually end badly. Stable coins maybe an answer today to the lack of a forward contracts and derivative markets that exists in other markets. In commodities and equities companies can mitigate future price risk using futures contracts and Options control risk with better granularity. Crypto need robust forward contracts and options markets more than stable coins IMHO.  For example, people could hedge their portfolio or treasury using barrier options to protect against big moves and treasury managers could arb the middle. I think this is a safer and more decentralized approach then trusting a project which either claims to peg to USD (most pegs are broken when the defenders can no longer to defend the pegs in tradition currencies) or takes custody of an asset in exchange for a token even programmatically.  People will hate stable coins when we are back in a bull market and they are safely sitting in $100/ETH and ETH is at $1000/ETH.  Lastly, are people doing the diligence they should be on the team, tech and security of stable coins with Market Caps of hundreds of millions of dollars of market cap?
BLOCK TRIBUNE:  Which sectors – energy, e-commerce, gambling – do you think will have the biggest impact in the blockchain industry in 2019?  (Feel free to choose any other sectors)
ANSWER:  Today all blockchain transactions are financial transactions. There are 8.6M smart contracts on Ethereum with 8k new smart contracts being published today all are engaged in the transfers of value in some way so I believe that speculation, trade, commerce, and gamming will continue to be where the innovation is.  Enterprises have blockchain envy because many have been on a digital transformation journey for the last 20 years and see blockchain simply as the next step in business process automation to facilitate trade. Trading, Supply chains, trade commerce, and digital goods are the obvious answers here.
BLOCK TRIBUNE: What event would you like to see happen in 2019?
ANSWER:  The industry needs to make blockchain easy for people to use. Amberdata.io enables transparency and trust so anyone has access to blockchain data and insights but we need to make the onramps for consumers frictionless so people use blockchain because it’s the right technology but that needs to be abstracted away from the consumer.  I would like to see blockchain made easy in 2019.
BLOCK TRIBUNE: Is the ICO dead as an effective fundraiser?  Why or why not?
ANSWER:  I hope the ICO is not dead.  The ICO was the first-time entrepreneurs have had access to a global investor base and had a global platform which they could frictionless launch applications to a global user base. Decentralization also enable network effects not afforded by money alone. In the US a very large percent of all venture capital happens in Silicon Valley this requires you be in silicon valley to raise money. Additionally, venture is a relationship business, so it requires you build meaningful relationships with those firms or be introduced. ICOs massively disrupted this equation.  Fast money did some questionable things but long term ICOs unlock the potential for flatting access to capital for innovation.  STOs seem to be the rage right now however, STOs can’t have the network effects of utility tokens.  I think STOs will be big at creating effectively global depository receipts for trading of illiquid assets or the securitization of assets. But we should be wary here as well because in equities depository receipts trade in thin markets and those derivative securities are often not backed by the company which they synthetically allow access to. I want to see the ICO market come back strongly.
Alex Mashinsky, CEO, Celsius

Block Tribune: Where do you see Bitcoin heading in 2019 and why?

Answer: I predict BTC will be back above $20k as institutions and family offices start buying coins at scale in 2019.

Block Tribune: Have recent crypto plunges affected your outlook and/or plans for 2019?

Answer: No. Our long term thesis has not changed.  The survivors from this winter will be few but their companies will become the pillars of the crypto community.

Block Tribune: What role will stablecoins have in the market in 2019?

Answer: True stablecoins will provide transfer medium for exchanges and institutions to trade across exchanges and the fuel to drive commercial adoption of smart contracts in commerce.

Block Tribune: Which sectors – energy, e-commerce, gambling – do you think will have the biggest impact in the blockchain industry in 2019?  (Feel free to choose any other sectors)

Answer: I believe finance, logistics and insurance will be the prime beneficiaries.

Block Tribune: What event would you like to see happen in 2019?

Answer: Mass adoption of crypto as digital store of value.

Block Tribune: Is the ICO dead as an effective fundraiser?  Why or why not?

Answer: I don’t see another wave of ICOs as there were too many bad projects funded in the last wave.  I do see hundreds of new STO which will tokenize many new assets for global financial access.

Marta Piekarska, Director of Ecosystem for Hyperledger 

BLOCK TRIBUNE:  Where do you see blockchain heading in 2019 and why?

ANSWER:  We in Hyperledger are seeing three key changes in the blockchain world. First there is a massive push towards enterprise-grade blockchain. And the enterprises are looking at real life use cases and deployments. There is much less of “just stick a blockchain in it” and much more of “What is my ROI in Blockchain?” Second, we are observing a slow merge towards more collaborative efforts. Blockchain is a peer-to-peer network and enterprises see the need to work together not reduce the effort and make the most of using blockchain. More sector-specific consortia are being built like We.Trade or The Floor. Third is interoperability, security and privacy improvements. That’s where our Quilt and Ursa projects are coming from: our ecosystem is definitely asking for more of this sort of solutions.

BLOCK TRIBUNE:  Have recent crypto plunges affected your outlook and/or plans for 2019?

ANSWER:  No, Hyperledger is a collaboration of open source developers and enterprises to  develop business blockchain frameworks and tools. We stay away from the cryptocurrency world and look at how can blockchain be applied to non-currency based solutions. This means that we are more focused on interoperability and solutions for moving data between blockchains than on the volatility of cryptoasstets.

BLOCK TRIBUNE:  What role will blockchain have in the market in 2019?

ANSWER: Blockchain is a technology, not a solution. So, we believe that 2019 will see blockchain being used in almost any industry ,but as part of products rather than  being turned into products itself. We believe that there is a huge opportunity to build more interoperable frameworks and a community around it. While there is definitely space in the cryptocurrency market, blockchain will enter more and more markets: advertising, ticketing, certification, etc. We will see more investment but also more pressure on real, useful applications. But, for every day users, I think it will look like blockchain disappeared.

BLOCK TRIBUNE:  Which sectors – energy, e-commerce, gambling – do you think will have the biggest impact in the blockchain industry in 2019?  (Feel free to choose any other sectors)

ANSWER:  .I think that blockchain will change energy, e-commerce, ticketing, advertising and training. One of the most overlooked elements of the blockchain world is lack of good, objective training. If one wants to get educated in “blockchain,” they should attend a course offered by organizations like Bitcoin Community, Etherium Community, Hyperledger Community, IPFS Community, ZCash Community andIoTA Community., It is a very opinionated and focused world, and there are only a few places where people can learn about all the aspects on blockchain and make up their mind on what is the best solution for them. Another huge move will be combining IoT, supply chain and blockchain. Probably we will throw a bit of AI on top of it. Sounds silly, but IoT and blockchain are made for each other. They feed well into autonomous and self learning devices.

BLOCK TRIBUNE: What event would you like to see happen in 2019?

ANSWER: In the blockchain world, I would like to see more focused conferences. The signal to noise ratio is still pretty bad: we do need places where everyday business people can get an overview of the ecosystem. We hope to start the trend with our Hyperledger Global Forum. I’m looking forward to the staple industry conferences like Consensus or DevCon. It will be exciting to meet the developers at our Hackfests and see where they plan to take the Hyperledger ecosystem. I would like to see more cross-sector and cross-industry eventsthat do not try to tribalize the space but rather bring the communities together and work towards better collaboration.

BLOCK TRIBUNE: Is the ICO dead as an effective fundraiser?  Why or why not?

ANSWER:  The ICO rush has definitely slowed down. We are getting better at understanding the good and bad ways to do it. We have standards like SAFT papers that help to do good and more standard ICO raisings. Mostly, regulators are looking at how to protect the investors and make sure that an ICO is not a scam. So rather than saying it is no longer an effective fundraiser, it is probably becoming more reliable (though maybe not safe) way of investing. Without regulations, it will be a jungle, so I am happy to see clear rules on how ICOs should be treated (mostly as securities). Finally, the industry giants are saying that while the number of the ICOs and the money raised through it has decreased significantly, the quality of them increased unproportionally more.