Will 2018 Live Up to the Cryptocurrency Craze?
The world of cryptocurrencies, especially Bitcoin and Ethereum, has experienced an extremely volatile market in 2017. The Cryptocurrency craze created by the skyrocketing prices of Bitcoin has intrigued the ‘ordinary’ to follow the news wire and even trade the crypto assets. Many see cryptocurrency trading as an easy way to earn money. But, the highly volatile market demands the trader to have some knowledge of the technical and fundamental aspects in order to be successful.
Blockchain technology will keep disrupting more avenues
The term “blockchain” has been doing the rounds across several financial circles and markets. Analysts and financial speculators are convinced that blockchain technology will be at the heart of all emerging technological advancements next year along with artificial intelligence, machine learning, and robotics. Apart from this, blockchain technology is expected to to give way to a more cyber secure environment in the near future, which will be a critical development for the sector.
The last quarter of 2017 saw major corporate and financial institutes announce plans for blockchain related projects. Many renowned banks, financial institutions and other market players like Deutsche Bank, NASDAQ, DBS Bank, U.S. Federal Reserve, Wall Street and ASX have already started the process of implementing the blockchain technology in the transaction process. Talks around many institutions are about incorporating bitcoin and other such cryptocurrencies to purchase and sell day-to-day commodities. For example, a person can refuel his or her car by paying in bitcoins. This wide-scale blockchain adoption can be attributed to the level of security it possesses, almost unparalleled with any other system.
What to expect in 2018?
2018 is expected to be a breakthrough period for blockchain development and adoption. It is expected that zero-trust security models will re-emerge next year, as enterprise systems scramble for finding new ways of authentication. Hence, blockchain holds the key to fool-proof cyber security, providing a concrete system for data and funds accessibility.
Some interesting applications of blockchain and Internet of things (IoT) are expected to debut next year, contributing hugely to the cyber security sector. 2017 saw significant hack attacks on financial institutions, the banking sector, and even the cryptocurrency exchanges. Blockchain can be the key component to remedy this situation. It is slated to become the sole implementer of the zero-trust policy, which will pave the way for cybersecurity in the future.
What about bitcoin and other cryptocurrencies?
There is considerable speculation making its way through the markets about the future of bitcoin and other cryptocurrencies. Although it is difficult to predict the future of the market, the trader has several tools at their disposal to understand where the market is headed. In the following sections, we will focus on the year 2018 and what potential developments could influence price action for the major cryptocurrencies.
To recap: the shift from 2016 to 2017 saw the growth of the bitcoin bubble. The question now is: will the bitcoin bubble continue to grow in 2018? By the looks of it, bitcoin still has legs to grow. The flood of countless other altcoins on the market suggests demand for cryptos will remain high for the foreseeable future. Of course, this is not a prediction, but an observation about where the market could potentially go in the near future.
And more security threats?
Along with growth in the number of cryptocurrencies there has also been a rapid increase of threats and hacks of the crypto coins and cryptocurrency exchanges. It is well known that the totalitarian government of North Korea is financing at least some of these hacks. Recently, South Korean exchange Youbit faced multiple security breaches, leading it to eventually declare bankruptcy.
Meanwhile, crypto firm NiceHash recently reported the loss of about $64 million worth of bitcoin. Till now, it has been estimated that nearly 980,000 bitcoins (more than $15 billion based on current prices) have become the victim of burglary. So, the security issues have not been completely resolved when it comes to the safety of trading cryptocurrencies. Presently, South Korea and a few other nations are thinking about implementing taxes and some regulations to curb the cyber attacks and to regulate excessive trading. Every dark cloud has a silver lining. The silver lining, in this case, is the steps being taken to improve the security system of exchanges that will hopefully allow for a safer trading of cryptocurrencies in 2018.
There is also the issue of scalability of the most renowned cryptocurrencies—bitcoin and Ethereum. The forks have managed to increase the block size, which in turn has increased the speed of the transactions. The cryptocurrency software developers look forward to completely solving the transaction issues. It remains to be seen whether this will require more forks, and whether the blockchain community will embrace the newly created coins.
Also, some more currencies to trade…
Some cryptocurrencies other than bitcoin and Ethereum to look out for in 2018:
- Litecoin (LTC): Litecoin was created in 2011 and currently shows a market cap north of $18 billion. Litecoin creator Charles Lee wants is putting more effort into his crpyo asset in 2018. One of his chief motivations is increasing transaction speed.
- Monero (XMR): The creator of Monero is anonymous, just like that of bitcoin. With Monero, all the details of the transaction are saved on the public ledger but it is difficult to connect the sender to the receiver or to the size of the transaction. This means that the transaction details are completely untraceable. This has made it more vulnerable as it is easier for the hacker to escape.
- Neo: Neo is often considered to be the “Ethereum of China”. The creator of Neo is Da Hongfei, the CEO of Onchain. Erik Zhang is the co-founder.
- Cardano (Ada): Cardano was created in October 2017 and already has a market cap above $12 billion. The blockchain developer Input Output Hong Kong (IOHK) created this cryptocurrency. The next phase of Cardano’s framework is going to be released in 2018.
- Ripple (XRP): Ripple was developed by Ryan Fugger, Jed McCaleb and Chris Larsen in 2012. Ripple has played a crucial role in linking banks and corporations to the blockchain technology and thus cryptocurrencies.
- Iota (MIOTA): Iota, unlike other cryptocurrencies, does not have any trading fees, blocks or miners. The objective of Iota is to become the support for machine-to-machine payments in the IoT (Internet of Things) economy.
- Bitcoin Cash: Bitcoin cash has come a long way since its altcoin days. Created on August 2017, it is one of bitcoin’s most recent forks.
Several cryptocurrencies are gaining popularity rapidly, a sign that the crypto craze will continue to grow in 2018. Investors should keep a close eye on the market cap of altcoins, as this provides a good bellwether of underlying demand for cryptocurrencies not named bitcoin.
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