Hopes For The Cryptocurrency Industry On 2020
2020 is already here. What will the new year bring for the blockchain industry? Is it going to be a good time for crypto?
The last year was an intensive period for the cryptocurrency world. Bitcoin emerged from the crisis and recovered loses. Many exciting projects were also announced. We entered 2020 in a much more comfortable situation than at the beginning of the previous year. What can we expect from the next twelve months? Take a look at our thoughts, predictions, and expectations!
Predictions about Bitcoin’s price
For many of us, the most interesting issue for the coming months is, of course, the price of Bitcoin. Predictions in that matter are an integral part of celebrating the new year for the crypto world. What can we expect from the current leader on the cryptocurrency market this time?
As usual, the forecasting of the price of cryptocurrency isn’t an easy task due to many factors that may affect it. Last year is an excellent example of it. The announcement of Libra initiated an unexpected bull run, and no one except Facebook authorities could know about the upcoming stablecoin. Such unpredictable situations are the key factors that affect the market.
Although it’s hard to point such situations before they actually happen, the year 2020 is the date of one particular crypto event, which is highly anticipated by the community. We’re talking about the upcoming halving of Bitcoin blockchain. It is the process of decreasing the number of coins acquired by crypto miners, in order to avoid inflation.
The idea of halving came directly from Satoshi, who saw this as a solution for regulating the number of existing coins on the market. Although the exact date is not fixed, it could be approximately calculated on May 13 this year. The halving will result in cutting the miners’ rewards in half. Why is the cryptocurrency industry so excited about this particular event?
Bitcoin halvings have already happened twice, having a positive impact on its price due to higher demand for bitcoins caused by lower supply. Many believe that this time too, the situation will happen again. But on the other hand, the recent halving of the other popular cryptocurrency, Litecoin, didn’t make any major change in its price.
Libra on the way?
Opinions about the upcoming stablecoin made by Facebook might be divided. Still, we all probably agree that Libra’s announcement was one of the most critical moments for the cryptocurrency industry in 2019. It not only caused the cryptocurrency market to rise after the recent crisis, but it also initiated the ongoing trend for stablecoins.
But the launch of Facebook’s currency still remains in question after all this time since the announcement in June 2019. The social media giant met with overwhelming criticism from the side of the American government, which caused some initial supporters of Libra (like MasterCard, PayPal, or Visa) to abandon the project.
Nevertheless, all obstructions haven’t made Facebook’s CEO Mark Zuckerberg and the head of the project David Marcus to write off their cryptocurrency. Libra may come back in style in 2020 and once again shake the industry.
Chinese crypto revolutions
The other unreleased cryptocurrency that had a strong impact on the industry during the second half of 2019 was digital yuan, officially known as Digital Currency Electronic Payment (DCEP). Although it is considered as Chinese answer to Libra, the government of the People’s Republic of China has been working on the project for a few years. The coin is a part of a larger plan of boosting blockchain technology in China, announced at the end of last year by President Xi Jinping.
As in the case of Libra, we still don’t have much detail about the incoming currency, or a specific launch date. The name says it all -DCEP is to be a global market-oriented means of payment. Global aspirations of Chinese government seem to be worrying for Mark Zuckerberg, who uses this as an argument for US support for Facebook’s own currency as American dollar-oriented.
One thing is for sure: the clash between DCEP and Libra is inevitable. And if one of them (or both) will eventually launch in 2020, it will surely be one of the most momentous events to happen during in coming months.
Decentralised finances – a continuing trend
However, Facebook and China weren’t the only ones open to the idea of digital assets in 2019. Faster and more secure transactions on the distributed ledger open to associated only with Bitcoin and other cryptocurrencies. In effect, the whole global financial system became more open to the idea of blockchain technology.
The number of blockchain-based platforms and products has increased recently, with new banks, companies, and governments willing to introduce this new trend in their own systems. Will this trend continue? The year 2020 will test it for sure. It might change the worldwide acceptance of blockchain technology, making people more eager to accept cryptocurrencies. On the other hand, it may also be just a temporary trend.
Speaking of people’s acceptance, the entrance of governments, and commonly known companies into the field of blockchain technology may take us closer to the already mythical crypto adoption. Not so long ago, Bitcoin and other cryptocurrencies were viewed by public opinion as a technological curiosity at best, or considered to be related to crime schemes in the worst-case scenario.
Now, decentralized and digital assets have become a part of our society. Their importance is growing every year, and the interest shown by large corporations or governments contributes to raising people’s awareness in that field.
But companies like Facebook aren’t the only example of bringing blockchain closer to the common people. Last year proved that cryptocurrency could be used as a functional means of payment, even in harsh conditions. Paying with crypto during blackouts in Venezuela or using bitcoins by Hong Kong protestors are only two significant examples. If this trend continues in the future, perhaps the adoption of crypto may become a fact.
The growing trust for cryptocurrencies among people will also correspond with the authorities’ approach to them. The regulations of the crypto market may be viewed negatively as government interference into the system, which is meant to be decentralized and free from such abuses. However, to function correctly in the modern economic policies and processes, some sort of legal steps have to be taken.
This might be done both in the wrong and the right way. Some governments may “regulate” cryptocurrencies by actively restrain them, or even ban as it happened in China (despite their changing approach toward the blockchain technology itself, the Bitcoin ban remained in force).
Others may focus on anti-money laundering policies, trying to propose a system that will please crypto enthusiasts, alongside limiting any criminal activities related to this technology. Thankfully, this approach prevails over the first one, and the situation is likely to continue. Clearly defined legal status of digital assets will not only make using them safer, but it also may facilitate entering the market for those who are currently afraid of it.
The great unknown
As you can see, our thoughts for the upcoming months in the cryptocurrency industry are rather positive. However, the market is changeable and unpredictable. We can’t be sure how the situation will develop and what will happen. Nevertheless, we hope that the summary of the year 2020 will be as favourable as today’s predictions.
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