Digital currencies have become increasingly popular in recent years. CBC News reports that cryptocurrency is big business, “despite only coming into the public consciousness a decade ago with the invention of Bitcoin.” These alternative currencies have slowly entered the mainstream, with Bitcoin invariably leading the way. Introduced by Satoshi Nakamoto, a pseudonym used by the person or persons who developed the world’s first cryptocurrency, to this day, Bitcoin remains the most prominent digital currency. As new cryptocurrencies continue to become more widely used, you can expect Bitcoin to remain the top choice among crypto enthusiasts across the globe. That being said, Bitcoin’s boom is just one of the cryptocurrency trends to watch out for in 2020. Below is our complete list:
1. Bitcoin is predicted to boom
Bitcoin has witnessed record price fluctuations in recent years. It peaked at $20,089 (C$26,710) in December 2017, then plummeted to $3,200 (C$4,255) a year later. In 2019, Bitcoin’s price stabilized, staying near $7,000–$8,000 (C$9,307–C$10,637) for much of the year. However, News BTC notes that the price of Bitcoin is predicted to increase in 2020, ultimately predicted to breach the $15,000 (C$19,944) mark by May. This uptick will be due to Bitcoin’s scheduled halving in May. Analysts are divided as to the long-term effects of this halving. Bitmain co-founder Jihan Wu insists no Bitcoin bull run will follow. But several price modelling results show that Bitcoin’s price will, indeed, go up next year.
2. Altcoins will be more “alt-tractive”
ADN Coins points out that the number of altcoins continues to rise and their functions are starting to go mainstream. That trend will continue in 2020, as “more altcoins will join the fray and take their place in the crypto market.” But these new altcoins will “need to provide another utility that other top altcoins are not hinged on” for them to be truly competitive and disruptive. The top altcoins, at the moment, are those used in payments (e.g., Litecoin, and Bitcoin Cash), DApps (e.g., Ethereum, Tron, and EOS), and crowdfunding (e.g., Binance Coin, which is the most popular in this case).
3. Governments will integrate cryptos
Governments around the world have cautiously started to move towards digital currencies. They will still proceed with caution in 2020 but will be more open to cryptocurrencies. As per the norm, the Canadian government has been progressive to this end. The Bank of Canada is currently leading a working group of global partners to figure out how to best use, integrate, and if necessary, regulate cryptocurrencies.
Even China, which in 2017 banned digital currency in the Mainland, seems to be opening up to Bitcoin, and its underlying blockchain technology. Just this month, the Bank of China (one of the four biggest state-owned commercial banks in the country), posted an in-depth — and at times humorous — infographic about cryptocurrencies. The infographic details Bitcoin’s history and clarifies some of the misconceptions surrounding it (notably, that it can make people wealthy overnight). It has also been rumoured that the Chinese government is developing a Bitcoin supplement to the Chinese Yuan. Such developments are clear proof that governments will be more accepting of cryptos moving forward.
4. Gold-backed currencies will continue to be stable
Stablecoins, specifically gold-backed currencies, are likely to have a strong year, too. Our post, ‘What You Need To Know About Gold-Backed Cryptocurrencies’ discussed how a stablecoin’s value is tethered to a tangible asset class. In the case of gold-backed currencies that asset is gold, which investors have long regarded as a safe haven. 90% of demand for the yellow metal is due to its intrinsic value. This is why gold provides value even as other assets struggle, especially in times of economic uncertainty. Gold-backed currencies will lean on the precious metal more next year as the global economic forecast for 2020 is gloomy. This, in turn, will help give them year-long stability.
As with any asset, investing in cryptocurrencies involves the risk of substantial loss, including the loss of your entire investment. SolidTrust Pay is not an investment advisor or fiduciary and this content is provided for informational purposes only. Before purchasing cryptocurrency, please evaluate your financial situation and personal risk tolerance.