What Does the Future of Blockchain and Cryptocurrency Hold?
Unless you’re a time traveler who just landed in 2018, you know that Blockchain is far and away one of the hottest tech trends to hit the business world. It’s the technology that drives Bitcoin and other alternate currencies that have been making headlines around the world lately. Not a single day goes by without mention of Bitcoin’s wild swings, as cryptocurrencies experience dramatic surges and massive crashes. The era of blockchain and crypto is upon us, and with that comes the buzz, hysteria, and frustration associated with every new tech wonder. There are still many questions surrounding the nascent industry. What does the future of blockchain look like? Will cryptos eventually replace cash or are they just a passing fad? Read on to find out what’s in store.
WHICH CAME FIRST, THE CHICKEN OR THE EGG?
Before starting off with the Blockchain predictions, let’s figure out who is who and what is what.
The world was introduced to blockchain technology through the digital currency Bitcoin, which, however, is just a tiny gear in a giant blockchain mechanism, the framework that makes cryptos possible. This paints a perfect and compelling picture of just how big of an impact the rising tech can produce. But because cryptocurrency was the very first use case for Blockchain technology, many use those terms interchangeably, and that’s what brings confusion.
Though made popular as the engine for Bitcoin, blockchain technology has potential business applications stretching far beyond virtual currencies. It’s already changing the face of many established industries, and the future of blockchain is widely viewed as the tomorrow of not merely data transactions, but almost everything of value, regardless of industry.
Now, think of a blockchain as an enormous, publicly accessible shared ledger of records. It’s not held on a single server, but distributed across a global peer-to-peer network of computers. Because there’s no centralized database, the data can’t be hacked or manipulated in one’s favor. The system allows you to do away with third parties, once and for all. This is, in and of itself revolutionary because it opens the door to the global economy for ordinary people. That said, however, will Blockchain be able to survive the burst of the cryptocurrency bubble, as investors continue to use Bitcoin as a yardstick for the well-being of the blockchain market?
THE WILD, WILD WEST OF CRYPTO
The world has split into Bitcoin haters and lovers. Supporters of cryptocurrency predict it’s the future of money, while skeptics think the promise is overblown and the Bitcoin star will eventually fade. The opinions might vary wildly, but the reality is that crypto has become an international sensation and is not going anywhere anytime soon. For all the criticism, it’s hard to ignore the massive amount of money invested in the field. With a market cap of billions of dollars, digital currencies such as Bitcoin, Ethereum, Ripple, and other big names, are making the world take notice. Cryptos are increasingly becoming the wave of the future, as more and more companies accept them as valid currencies and governments legitimize them as payment vehicles. There is, however, the other side of the Bitcoin coin…
Virtual currencies are still way too volatile and you never know what’s around the corner. Anyone on the lookout for the promising coins, knows about the ups and downs of crypto. Bitcoin, for example, a trailblazer for all digital currencies, has been on a roller coaster for a good couple of months now. It reached an all-time high in late 2017, hitting close to the $20,000 mark, before suffering a steep 50% plunge shortly after. Only in the wild west of cryptos!
So, what should we expect to come next? To bring some clarity, we’ve summarized four plausible scenarios for the future of blockchain and cryptocurrency.
#1 Crypto is here to stay
Despite all the bubble talk, cryptocurrency continues to march on. Even if it may seem that the crash is on the way, once the dust settles, we will ultimately realize that blockchain-based currency is a long-time investment.
With innovative productive solutions underway, making crypto coins a means of payment is becoming a new norm. Spending and accepting them easily, widely and anonymously justifies adoption of cryptoassets, though currently volatile. Cryptos may still be the underdogs of online trading, and retailers who accept virtual currencies are still very much in minority, however, the acceptance of Bitcoin (and altcoins in general) as a medium of exchange has been on the increase. A growing number of traders and service providers are ‘joining the cryptoclub’, so we can expect a wide crypto penetration and an overall increase in its value.
Some critics of digital coins argue that technological complexity of Bitcoin and its peers will likely deter most people, except for the tech-savvy. But what they are actually missing here is that millennials, now the largest population on Earth, grew up with the tech at their fingertips and are now a distinctly digitally literate demographic. With technology woven into every fiber of their being, millennials are welcoming new industry dynamics with open arms. Using cryptocurrency is no rocket science to them. They can appreciate the beauty of not just being a user, but also a stakeholder in the solutions of the future. So, millennials are willing more than anyone else to embrace the risks of the volatile trend and reap the benefits of blockchain.
#2 Bitcoin will be overtaken in the long run
Bitcoin was the first coin to rise to prominence and has its fair share of users. However, the future likely doesn’t lie with Bitcoin. That’s not to say that the future doesn’t lie with other cryptos. Bitcoin’s leading rivals, Ethereum and Ripple, have the potential to supersede Bitcoin not only as pure currencies, but also as blockchain solutions. Ethereum provides a smart contract platform and Ripple functions as a payment mechanism that enables conversion of global money into local money.
Things that are first to market are usually outcompeted by alternative platforms that offer more powerful functionality and address inherent technical flaws of their predecessors. In the coming years we’ll be witnessing the rise of a new generation of cryptocurrency and blockchain solutions that could help overcome many of the existing bottlenecks and deal with critical issues of scalability, massive energy costs, slow transaction speeds, and capacity limits.
#3 Virtual coins to replace fiat
Futurists go as far as predicting that crypto is going to displace traditional fiat money some time in the future. While that possibility looks remote, cryptocurrencies are gradually making their way to mainstream financial systems. We can now see a more pro-government stance on the use of blockchain technology all around the world. And if you look at some countries with depressed economies and collapsed monetary systems, like Venezuela and Zimbabwe, you will see how virtual coins can fill that void. After bouts of hyperinflation of government-issued currencies, Bitcoin has become a major means of exchange.
Creation of new money that is not subject to political interference is a response to the inflationist agenda of central banks and government manipulation of national currencies. With all that has been going on in existing monetary and banking systems, there may come a time when people would prefer private money over public money. Because everyone is trying to protect their funds from the outcomes of currency wars, cryptos are increasingly gaining a wide appeal with the public as a store of value and investment.
Blockchain-based currencies will also have a pivotal role to play in an age of cash use decline. Experts agree that this trend is set to continue, as money has been moving from physical to digital. Fast forward 30 years from now, and there might not be the very concept of cash anymore.
#4 No industry will be left untouched by Blockchain
While cryptocurrencies have been getting tons of attention from investors and media, they are just scratching the surface of the potential uses for the distributed ledger technology. As more and more Blockchain-related ventures are maturing, we will soon start to see a string of new actual products entering the blockchain market that will yield true value.
According to a Gartner Trend Insight Report, “the blockchain revolution promises to touch every industry.” This claim is evidenced by the fact that Blockchain, while still in its infancy, is already finding its way into a variety of domains, including banking, finance, retail, digital media, healthcare, insurance, energy, real estate, education, entertainment, government, and more. You pick an industry, and blockchain technology holds huge potential to disrupt it, allowing people to benefit from the value they create.
AND HERE’S TO THE FUTURE OF BLOCKCHAIN!
Whether these predictions will stand up to reality, only time will tell, but one thing is sure: blockchain development will be one of the hottest areas of innovation in 2018 and beyond. The years to come are expected to bring a wealth of opportunity to those seeking to optimize their business with the use of distributed ledger solutions. So, if you’re big on blockchain and looking for a technology partner that can help you give shape to your project, feel free to holler at us through the contact section.