Cryptocurrency has had its ups and downs over the past few years, but given that digital money is still considered a novelty, these fluctuations can be perceived as its growing pains.
However, the 2020s have been dubbed “the decade of crypto.” If we bear in mind that even Facebook announced that it would launch its cryptocurrency Libra, it’s easy to conclude that this isn’t just a fad that will disappear after a couple of suffered blows.
Moreover, an increasing number of different crypto and blockchain use cases that have been emerging as of recently prove that this technology has only scratched the tip of the iceberg.
1. The Rise of Decentralization
Cryptocurrency rests on the concept of decentralization and removing middlemen from financial transactions, and it’s expected to additionally move away from a traditional financial services model.
Experts predict that we’ll be ushered into the crypto-to-crypto realm, meaning that Dapps, non-custodial wallets, and DeFi crypto projects will be substantially improved when it comes to their usability and security. As a result, a number of new use cases will emerge such as games or online communities which will evolve into virtual worlds with their own, independent economies.
The fact that decentralized apps and non-custodial wallets are not regulated centrally and don’t rely on the existing monetary system established and controlled by governments, means that users will hold the power over their own funds. This will ultimately lead to these non-custodial wallets being regulated not as financial services but as software companies.
Such revolutionary change will unleash a string of new innovation possibilities and transcend their current geographical boundaries, thus allowing for globalization in the real sense of the world.
Finally, the idea of decentralized identity will become a reality, and reimagine the way we share, access, and control our sensitive information.
The previously mentioned globalization also means that people will be able to earn a living in cryptocurrency – without the current state or land barriers. All this will, in turn, render credit card scores obsolete and reputation scores associated with decentralized identities will take place.
2. Crypto Will Move From Trading to Utility
Currently, the best crypto business models revolve around trading.
As it’s expected that new cryptocurrencies will mushroom, the need for crypto exchanges will grow. This practice still isn’t mainstream, but in the 2020s, more and more people will start trading with different cryptocurrencies.
Other powerful technologies will additionally spur this trend – AI-powered banking chatbots capable of performing millions of calculations and obtaining gargantuan amounts of data in seconds will act as brokers. In other words, it will be easier for regular people to engage in such transactions with the assistance of intelligent algorithms.
But, this isn’t the only way to leverage crypto.
As a matter of fact, it’s expected that people will also start using cryptocurrency for non-trading purposes. In other words, the world will move from the investment phase into the utility phase, in which crypto will be used in peer-to-peer transactions – thus buying products and services with crypto – whose main goal isn’t making money.
This trend is in its infancy, as according to estimates, only 10% of the entire crypto activity takes place in the area of utility. Although this is what the original intention of cryptocurrency was, investments and money-making dominated this field, but in the next decade, trustless digital payments and P2P transactions without banks and centralized government systems will become more prominent.
3. Regulatory Issues Will Be Fixed
It’s important to stress that cryptocurrency has been devised in order to reduce government control in the field of information and finance and bypass traditional institutions.
That way, an increased level of freedom and ownership of one’s own assets and personal information could be achieved.
But, as with every new concept, particularly the one that creates a seismic change such as crypto, some regulatory challenges are inevitable. For example, Bitcoin has fallen victim to ruthless speculation and price manipulation, which almost ruined its reputation. At a certain point, investors perceived this cryptocurrency as a not particularly stable asset.
At the moment, it’s virtually impossible to believe that cryptocurrency can exist completely independently from governments. Although this seems to contradict some of the basic premises of decentralized currencies, a solution that can bridge this gap and stabilize usually volatile and unpredictable financial markets has to be found.
It will come in the form of Stablecoins – cryptocurrencies that will tie their value to some real-world pool of assets and fiat money. This will reduce price volatility, which is one of the biggest obstacles to the mainstream adoption of crypto.
Retailers will be more comfortable to accept crypto payments in this form as Stablecoins offer price stability.
These 3 major cryptocurrency trends will dominate the next decade and may become catalysts for the widespread adoption of decentralized services and banking.
About the Author
Michael has been working in marketing for almost a decade and has worked with a huge range of clients, which has made him knowledgeable on many different subjects. He has recently rediscovered a passion for writing and hopes to make it a daily habit. You can read more of Michael’s work at Qeedle.
Previous Articles:
- Advancements in Investing: how innovation is changing the way we save
- What Will Bitcoin Look Like in Twenty Years?
- BlockFi Review: Is BlockFi Lending Safe
- Why Are Crypto Entrepreneurs Investing In The CBD Industry
- How The Bitcoin Industry Is Shaping The CBD Industry
