The bubble burst, cryptocurrency is dead! Undoubtedly, this is a phrase veterans in the market have heard countless times, and even new entrants, probably more times than they can count on one hand.
Well, I’m here to assure you that the state of cryptocurrency has never been better, and the future: never brighter. And no, I am not going to attempt to assure you by shouting back massive gains, or big technological words, like many of us believers tend to do. Not at all. Instead, I dare to dig a bit deeper than just prices, into the true fundamentals of what’s going on under the hood of the global cryptocurrency and the blockchain ecosystem.
There are currently approximately 220 exchanges servicing the global cryptocurrency market, with the top 10 exchanges regularly experiencing hundreds of millions of Dollars in trading volume a day, and the giants like Binance regularly surpassing a billion Dollars in daily trading volume (Anon., n.d.)
Let’s compare this to 3 years ago, when there were just 70 exchanges servicing the entire market (Anon., n.d.) and the value of BTC traded per day in total across them all was lucky to reach 50 million Dollars per day (CMC, n.d.). The number of exchanges has more than tripled in the space of just over 3 years: this easily illustrates how rapidly demand for cryptocurrencies, and access to cryptocurrencies has grown, and is growing.
Number of currencies in existence:
It all started on January 9, 2009 when Satoshi Nakamato’s whitepaper for Bitcoin became a reality: the world’s first cryptocurrency. Since the introduction of that first cryptocurrency, there have been over 1500 additional cryptocurrencies created, all for unique purposes with unique properties, including international remittance, running applications, gaming, charity, and more. (source: CMC)
Institutional adoption, capital and skills migration:
According to a recent article on CCN, citing research done by Crypto Fund Research, 20% of Hedge funds formed this year were cryptocurrency-focused (Anon., n.d.). That’s 1 in 5 Hedge funds – those big money Wall Street-type companies – that were created this year were created to invest in cryptocurrency. No matter your opinion of Wall Street and the current financial system, they are – for the most part – a bunch of well resourced, intelligent and diligent people…and right now they are all flooding into crypto. And it’s not just graduates either. In 2018 alone, Apple co-founder, Steve Wozniak, joined EQUI Global, a blockchain and crypto focused venture capital firm; Gary Cohn, former White House economic advisor joined the advisory board of Spring Labs, a venture capital funded blockchain firm, and the previous economic advisor to Obama and Bill Clinton, Gene Sperling, has joined Ripple Labs. Let’s not forget the Nobel Prize-winning economist, Oliver Hart, who is now consulting for Prysm Group, a blockchain governance, economics, and design firm, that focuses on air tight smart contracts.
With some of the brightest minds and billions of Dollars in venture capital being poured into this space, it’s hard not to be both excited and intrigued by what will emerge from this marriage of intelligence and capital in the crypto/blockchain ecosystem.
Someone once told me that, if you want to take a glimpse into the future, take a look at the patents being filed by the giants of the world today. If you had done that, low and behold, you would have found the top two applicants for blockchain-based patents in the world for 2018 were Alibaba and IBM, with Visa Google, Sony, tencent and even the People’s Bank of China all ranking respectably themselves (CoinDesk, n.d.).
It’s unbelievably clear that, no matter their public façade, the brightest minds, biggest companies, and most resourced entities around the globe, are all diving into cryptocurrency and blockchain headfirst, and with this being the first time we’ve really had all three in combination, at this scale, I cannot wait to see what the future holds!
And yes, it should translate to massive appreciations in price, eventually…