Cryptocurrencies – What’s going to happen in 2018?

As with any event, what happened in the past cannot be used to help to predict the future and we can only draw inferences from the past to see how the industry would be like in 2018.

Bitcoin has been the leader of the crypto industry during 2017 as its prices grew from $1000 at the beginning of the year to $19,000 by the end of the year. This has made everyone, including the central banks of various countries, sit up and take notice. But as we head to the close of the year, we are seeing increasing signs of fatigue in the bitcoin market. This has been caused by the phenomenal increase in Bitcoin prices which has taken it out of the reach of the common man. We are also seeing the introduction of Bitcoin futures adding pressure to prices as also some of the proposed regulation.

It is in this scenario that we are seeing the increasing focus on altcoins like ETH, LTC, IOTA, and Ripple. In the year 2018, we believe that altcoins would rule the crypto world as Bitcoin stays in the background. It is not that the altcoins didn’t do well in 2017 as we saw the prices of Ethereum rise by 100 times in 2017 but they didn’t gain as much attention as BTC in 2017. But we believe that 2018 would be different in that aspect with altcoins gaining traction among investors and speculators as they hunt for the next bitcoin among them.

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Ethereum and ripple, as well as another coin called IOTA, are driven by some strong fundamentals which makes them different from bitcoins in that aspect. With more and more traders and investors looking for value in their investments, it is likely that these coins are going to find favor in the medium term and the early signs of that are there for everyone to see.

But with increasing prices and increasing attention from traders and the common man alike, we are going to see increasing attention from regulators as well. Towards the end of 2017, we have been seeing many central banks and regulators taking note of the rise in prices and also how such cryptos are being misused for money laundering and we are seeing an increasing crackdown on the same, from them. This is likely to gain even more force during 2018 as regulators from more and more countries make it mandatory that the crypto investments and trades be tracked and many regulators begin to tax them as well.

Already, we are seeing countries like Japan, South Korea, and Malaysia following the footsteps of the US and Singapore and taking measures to control ICOs and tax the gains made from cryptos while countries like China have banned them outright. This part of the industry is likely to mature even more and see some more action in the coming year as the banks and regulators begin to feel the pinch and realize the need to step in at the right time. The crypto industry is also on the lookout for much-needed recognition and if such regulation leads to recognition, then it is a trade-off that the crypto industry is likely to be happy to take.

Once the markets become regulated, we are likely to see more and more sophisticated investors and traders enter into the market which would be helpful for the market to mature in a slow and steady manner over the medium and long-term. If 2017 was all about bitcoins and its price rise, 2018 could be about the altcoins and the growing regulation and maturing of the crypto market in general, paving the way for its acceptance into the mainstream financial system.

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