From Facebook's attempt to launch Libra, before China got closer to becoming the first major economy to release a central bank's digital currency, the past twelve months have been full of crypto headers.
2019 was no less dynamic in the development of blockchain and adaptation of cryptocurrencies, let's look at the largest
- Bakkt launches Bitcoin futures
The most anticipated new trading platform for bitcoins in 2019 was the launch of a futures exchange supported by ICE and the cryptocurrency custodian Bakkt. Despite the fact that trading volumes were slowly growing, Bakkt continued to reach new record volumes in the fourth quarter of 2019.
In 2020, Bakkt will ensure the institutional development of bitcoins. Whether institutions come in significant numbers or long or short bitcoins are coming is still unknown.
- SEC says no to Bitcoin ETF (again)
Another year, another “no” Bitcoin ETF from the SEC. Over the past twelve months, there have been several attempts to get Bitcoin ETFs through the finish line. However, all applications were rejected.
The current position of the SEC suggests that Bitcoin ETF is possible in a few years.
- Facebook announces Libra
Perhaps the biggest headline for the market this year was Facebook's announcement that it plans to release its own digital currency, Libra. Bitcoin's price has risen to a high of 2019 amid renewed interest in cryptocurrencies after Facebook announced its intention to launch Libra.
However, legislators and regulators doubted the possibility of issuing digital currencies by corporations that could compete with national currencies. Consequently, we expect Libra to face an even larger regulatory pullback in 2020.
- China loves blockchain, not bitcoin
Chinese President Xi Jinping announced that the People's Republic should make "great efforts" to develop and implement blockchain technology in order to gain a competitive advantage over other leading economies. Due to the fact that China goes all-in on the blockchain, we expect a wave of positive news from an Asian country.
However, China's love is linked to blockchain, not cryptocurrency. Cryptocurrency business is still facing difficulties in the People's Republic.
- China will launch CBDC
China is poised to become the first major economy to launch a central bank digital currency.
The RMB digital block, issued by the central bank, is expected to be operational in the first half of 2020, followed by other countries.
- Central Bank of Digital Currencies
While China is likely to become the first major issuer of CBDC, dozens of central banks are reportedly exploring the feasibility of issuing their own digital currencies based on a blockchain.
From the ECB to Bank Kora, central banks are developing the idea of issuing sovereign virtual currencies to provide them with greater opportunities to manage their currencies.
- Trump writes about Bitcoin
U.S. President Donald Trump hit the world with his gaze on cryptocurrencies when he tweeted: “I'm not a fan of Bitcoin and other cryptocurrencies that are not money and whose value is very volatile and based on weak air. Unregulated crypto assets can contribute to illegal behavior, including drug trafficking and other illegal activities. ”
He also shot at Libra Facebook to demonstrate his anti-crypto dollar stance. In 2020, we expect his views on cryptography to remain the same, which may affect cryptographic rules in the United States.
- Bitcoin Flow Model
The Bitcoin exchange model created by the cryptanalyst “PlanB” was the main topic for crypto investors in 2019. The model suggests that scarcity is a key factor in the price of bitcoin.
Although not all analysts agree with the validity of this model, it will remain a key story when Bitcoin halving takes place in May 2020.
- Ethereum Updates
In December, the Ethereum network finally completed its Istanbul hard fork, which aims to improve the speed, efficiency and scalability of the blockchain.
In 2020, we expect to see continuous updates to the Ethereum blockchain providing building blocks of what will become Ethereum 2.0, a new and improved version of the Ethereum network.
- Jack Dorsey Launches Square Crypto
Bitcoin attorney and Twitter CEO Jack Dorsey have launched Square Crypto, a new Bitcoin blockchain venture. Despite the fact that we continue to use the blockchain, we still know little about what the company is preparing.
However, given the success of the Cash application, we expect Square Crypto to become a net positive for bitcoins in 2020.
- binance.us
Digital Asset Exchange, Binance's Behemoth has launched a new exchange called Binance.US to serve US customers who are increasingly blocked by other exchanges due to the challenging regulatory environment in the US.
Binance.US has experienced significant user growth and is expected to become a major player in the US cryptocurrency market next year.
- Bitcoin dominance
The increase in the share of bitcoins in the market in the total market capitalization of crypto assets, called the dominance of bitcoins, increased in 2019. As the price of bitcoin recovered somewhat, most of the altcoin market could not resist, reinforcing the dominance of bitcoins as the number one cryptographic.
Although the opinions about whether we will witness the “alternative season” in 2020 are mixed, we expect Bitcoin to remain the most dominant asset in the next twelve months, as altcoin projects are struggling to attract users.
- Bitcoin Hashrate
Although the Bitcoin price (BTC) did not return to the highs of 2017, the bitcoin hashrate reached new all-time highs in 2019.
The “lunar” bitcoin hash rate indicates that miners expect the value of bitcoins to grow in the future, and use the new capital to mine the world's leading digital currency.
- Bitcoin-halving
While next year the reduction of block rewards will occur only in May 2020, this reduction became the main topic of conversation among Bitcoin investors in 2019. Most believe that the price of bitcoin will rise after this, which was historically (due to a decrease in the new BTC supply). Others suggest that halving will have little effect on price.
We expect this to be the main topic of discussion for crypto investors in 2020.
- Constant hacks
Despite the fact that cybersecurity is the main focus of exchanges and services, the huge number of hacks in 2019 shows that hackers remain one step ahead.
Unfortunately, exchanges continue to incur losses. This will almost certainly be the case in 2020.
- IRS Sends Love Letter to Clients Coinbase
The tax official sent a letter to suspected cryptocurrency holders in the US, “informing” them to put their affairs in order when it comes to their tax payments. The list of recipients probably consists of Coinbase users whose IRS data was received after a successful John Doe call in 2018.
In 2020, we can expect that more tax authorities will go for crypto investors who, in their opinion, were not honest in their declarations on capital gains tax.
- DeFi takes off
In the world of Ethereum, 2019 was perhaps the year of decentralized finance (DeFi). The second largest blockchain network has become home to decentralized financial services such as decentralized lending, trading and stablecoins.
We can expect the DeFi market to grow in 2020, which should benefit the Ethereum ecosystem.
- New Zealand legalizes crypto salaries
New Zealand officially legalized cryptocurrencies after the National Department of Internal Revenue (IRD) announced that cryptocurrencies such as bitcoin and ether can be accepted as salaries under the Income Tax Act.
See you in 2020 to find out more news and cryptocurrency market analysis)