5 Trends that Cryptocurrency has Set Up in 2020

5 Trends that Cryptocurrency has Set Up in 2020 By Amelie Miles - November 28, 2020
5 Trends that Cryptocurrency has Set Up in 2020

5 Trends that Cryptocurrency has Set Up in 2020

Cryptocurrencies are here to stay regardless of the fact that speculations drive the crypto market. The truth is that most of the leading crypto coins have managed to survive because of such speculation amongst investors about their potential. At the same time, one cannot deny the fact that there have been many shady tokens, undelivered blockchain technology, and ambiguity about the cryptocurrencies that have led to frequent rises and falls in the market. This year has been no exception to these dramatic price swings but it has set in motion many significant trends that are likely to help these assets grow in the future.

Top 5 Trends Set By Cryptocurrencies in 2020:

1. Bitcoin halving: This event is going to reduce Bitcoin rewards by half from 12.5-6.25 BTC. While this drop sounds too dramatic, this is an event that has happened two times before and has been followed by significant price movements thereafter. While halving may appear to indicate scarcity, Bitcoin traders are expecting the prices to escalate as they had on the previous two occasions. However, Bitcoin mining is slowly becoming less and less lucrative and the numbers of miners competing for one block will keep falling. 

2. New regulations: According to experts, 2020 will introduce many new government regulations and actions but these will not necessarily stifle the crypto industry. Crypto assets have always been marked by high volatility and price fluctuations. While governments everywhere are realizing that crypto transactions are secure, new regulations are going to make their entry in countries like the US and China. In 2020, many countries are going to allow crypto exchanges to enjoy legal force after registration with regional authorities. Using bots like bitcoin era would handle all such scenarios effectively and make the traders stay ahead of the curve and the market movements. 

3. Entry of federal authorities: Government scrutiny had been missing all these years but 2019 showed an increase in awareness by federal agencies. The IRS or Internal Revenue Service expressed its interest in reporting crypto transactions for the upcoming tax season. This indicates that the crypto industry will probably witness more attention from both national and local governments. According to some experts, the tax rulings have not been anti-cryptocurrency; rather, these have been quite progressive in nations like Switzerland and Singapore. However, highly-restrictive regulations such as those being advocated by China can lead to turmoil amongst crypto assets.

4. Marriage of Crypto and Fintech: With introduction of new coins like Libra the urge to make crypto relevant has grown. While there are controversies about the manner in which transactions will be done across multiple ledgers, there is a noticeable eagerness on part of fintech companies to handle this. For instance, Libra had been stacked with many fintech company members. Key players in the fintech and finance industries have made their entry into the crypto sector, such as the NYSE owner and many global brands like the CME Group. They have started offering Bitcoin Futures and custodian services to institutional investors. Crypto exchanges like Gemini, Kraken, and Coinbase are targeting accredited US investors.

5. Entry of Libra: The only downside of Facebook-backed Libra coin is that there still remains much uncertainty around it even though it has been backed by companies like Coinbase, Uber, and Vodafone. This led many parties to bow out of this currency altogether. But the only certainty is that it commands a huge user-base in the US of almost 170 million. Because of Facebook, users of this social networking site may finally start dabbling in cryptocurrencies, something that they had never attempted earlier. Libra’s entry could turn out to be a game-changer for the crypto world.

By Amelie Miles - November 28, 2020

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