The crypto market has had a bad run for most of 2022. Some of the leading coins, such as Ethereum and Bitcoin, have experienced over 50% drops from all-time highs in 2021. While many currencies have begun to appreciate in recent weeks, many people are unsure whether the currency’s future is bright. Here is what is expected of cryptocurrency based on the market, legal and institutional approaches to the technology.
More Institutions are going to Adopt Cryptocurrency
Mainstream institutions have begun to take a look at cryptocurrency and the opportunities it could open in the business world. A few fintech companies led the way a while back. PayPal and Square, for example, have made their platforms cryptocurrency friendly.
Tesla has been accepting Dogecoins from customers, with a back-and-forth on Bitcoin acceptance and decline. It also holds billions in cryptocurrency in various coins. Thousands more merchants around the globe now accept cryptocurrency as payment.
One industry that has embraced cryptocurrency is the gaming industry. Platforms that previously only accepted fiat currency have added e-currencies to their list of accepted payment methods. Many e-currency-only platforms have cropped up, accepting most of the leading cryptos. This Crypto gambling guide provides a list of the casinos that accept e-currencies.
Expect bigger, multinational corporations to join the bandwagon in the near future. They can use the e-currencies as a store of value in the long-term, ease payments for their goods and services and make extra money if the cryptocurrency value goes up.
There have been several incidences of cryptocurrency exchanges being hacked and losing billions of dollars in people’s savings. The authorities have noticed it and are taking steps to deal with these issues. One of the steps that is being taken is to establish laws and list guidelines that will make cryptocurrency safer for both users and investors.
Cryptocurrency was created with the promise that it is anonymous, secure and distributed. To some extent, this is true. Criminals cannot hack the cash in transit and the distributed nature of the blockchain technology ensures that the transaction information cannot be altered after it has been completed. However, the exchanges are becoming the weak link where criminals are gaining access to people’s assets.
Stable coins, such as TerraUSD, have had a poor run that caused them to fall in value in a few weeks and have been experiencing volatility ever since. This caused several coins to detach from the dollar but not climb up again. These things are making a bigger case for regulation of the conduct of exchanges and related stakeholders in the crypto market.
The future could mean that there will be a plethora of regulations to manage different aspects of the currency. This will be both a bad and a good thing. The bad thing is that it will take away much of the anonymity that comes with e-currencies. However, investors would be less likely to lose their money to scams and questionable transactions. Besides, regulation will inspire confidence among the general public that their money is safe in e-currency form.
There will be General Growth in Cryptocurrency
Cryptocurrency markets have been going down for a period with small rises that do not cover the downfall. However, pundits expect most crypto currencies to grow in the long term. However, volatility will be the order of the day in the near future. However, as they move up, the dip will be smaller and eventually make up a small percentage of the entire value of the coin.
Among the cryptocurrencies, Bitcoin is a leading coin that gives a feel for the market in general. It has been volatile for the majority of 2002, dropping from an all-time high of $68,000 to as low as $17,500. However, pundits expect it to go even lower, below $10,000. For this reason, the experts are advising investors to keep their crypto investments below 20% at the beginning of their investment journeys.
On the other hand, Ethereum might be a little more stable than Bitcoin in the near future but lower in value in the long run. The coin has undergone a major upgrade in the recent past. Since September, the coin has been moving its technology from being energy intensive and inefficient to being more efficient, faster and cheaper to utilise. If this upgrade works, the coin could grow rather fast and only experience modest dips.
NFT Ownership will Increase
Non-Fungible Tokens came to the market in 2014. However, the technology was not widespread until 2021. They represent digital ownership of assets that cannot be replaced but have value and can be exchanged. The gaming world was the first to take up novel technology with players getting graphics for different assets and weapons.
However, the corporate world has noticed it. Companies ranging from Gucci to American Express and fashion houses are now thinking of investing in their own NFTs for their iconic brands. Soon, people will have some graphics, sound and footage—or a combination of them—as part of the brand’s identity.
There is still debate on what will happen to NFT technology, with some experts calling it a bubble. However, the majority believes that the smart contract technology behind it will offer real value in the physical world. Artists, creators and graphic designers expect to earn money from monetizing their digital assets.
Overall, cryptocurrency is here to stay. In addition to helping with transactions and the storage of value, the technology behind it will help grow various aspects of the technological world. However, it will be more regulated and bigger than it is.
We may also discover new technologies derived from blockchain technology for use in other sectors of the economy. For the time being, cryptos are good for transactions, savings and investing.