Let’s discuss together the future of cryptocurrency in the 2020s. Of course, no one can predict it with accuracy but yes to get it accurate one can invent it.
The strata say the next decade will experience a more scalable blockchain. By the end of this decade, not only the emerging markets but also the tech startups using machine learning and the internet and government and institutions will adopt cryptocurrency in a big space.
The prediction says there are already many high-quality teams working on next-generation protocols like Cosmos, Algorand, etc and there Great teams focussing on layer two scaling solutions so there could be a consolidation of chains in the upcoming decade.
2020 will see a new blockchain or layer two solutions which will increase transaction throughput magnitude. Scalability would be pre-requisite for the utility phase of crypto. The new improved scalable blockchain will lead to the development of new applications.
Privacy would be the other change in the dominant chain in the 2020s. Prediction believes to see a “privacy coin” or blockchain encrypted with privacy features.
The past trend:
2010 was majorly about speculation and investment in cryptocurrency, and the trading drove most of the business models but in 2020s many new companies will be emerging in crypto space who will drive the utility phase which will deal with many of the non-trading activities which could be staking, commerce, lend or borrow, etc.
Emerging of crypto startup
2020 will experience a new type of startup: the crypto startup. It is predicted that this decade will experience every tech startup investing in the cryptocurrency component.
What is a crypto startup:
Firstly, a startup raising money through cryptocurrency.
Secondly, the tech startups would utilize cryptocurrency to issue tokens to early adopters similarly as it was employees getting equity in the company.
And lastly, it will create a platform where it will bring together communities and market place at a synchronized pace which was not there in the existing startup model.
The next decade will have people who get exposed to cryptocurrency will not be those who will be caring for it but those who are trying to play some games, earning a livelihood, decentralizing social network and for any other application.
Apart from tech startups, the other area who will adopt cryptocurrency on a major basis is the new emerging market, where the financial system is a big pain. This would include especially the countries having a high inflation rate and a large remittance market where crypto can be a great help.
Givecrypto.org, in 2019 has made crypto payment to 5000 people in Venezuela, and to the astonishment 90% were able to make a further transaction either with a local store or local cash out partner, indicating that the adoption of cryptocurrency has started in emerging markets. This predicts that in 2020s cryptocurrency adoption could be scaled to hundreds of millions of users.
Impact on Institutes and Financial Institutions
2019 witnessed small institutions entering the cryptocurrency space and it is predicted that in 2020 even large institutions will be a part of it. Also, every financial institution will have some sort of cryptocurrency operations and funding would require to keep a portion of assets in crypto because of upside potential and uncorrelated returns.
Matured market trend:
In 2019, cryptocurrency exchanges were brokerages, clearinghouses, brokerages, and exchanges. But in the 2020 crypto market would evolve from the traditional financial world and these functions would be separated from the regulatory point of view. Initially, consumer of one product was the competitor of other and there existed cross-pollination but with this new market trend, the market will get more comfortable and mature.
Decentralization will increase :
This will also increase decentralization. A new world will evolve which would be purely crypto-to-crypto. Many apps who never stored the customer funds would be used as software companies rather than financial institutions. Scalability and privacy will increase with the help of private crypto. The credit rating agencies could be replaced with decentralized identity and their scores. This decentralized crypto-economy will help people earn their living in cryptos and feel safe and empowered.
The new billionaire:
It is also predicted that in the world of 2020 many billionaires would be from cryptocurrency. Whether good or bad, there would be more pro-technology people having a large amount of capital in 2020 because of this cryptocurrency.
It is yet to be seen how much these predictions are accurate but after shifting the cryptocurrency from only trading to real-world utilization, 2020 will witness a huge chunk of people holding and using cryptocurrency.