Experts from The Element Group analyzed last year’s Crypto-market and told about ten trends of development of this industry in the new year. They also suggested, according to what scenario, certain events in the world of crypto can develop, the beginning of which we observed in 2017.
1. Hacking of a large Crypto Exchange
The growing interest in crypto-currencies caused in late 2017 after a large influx of new users to the crypto-exchange. Because of this, the Bittrex, Bitfinex and Binance exchanges had to suspend the registration of new users, as the number of applications exceeded the technical capabilities of the sites.
Due to the high demand in 2018 new players will come to the market, many of them, most likely, will not have technically strong teams and experience. Hackers will not miss the opportunity to check for vulnerabilities in young companies. It is also possible that one of the larger players will fall victim to intruders, due to low operational standards and the lack of risk management infrastructure.
2. Futures on Cryptocurrencies, more options, the formation of crypto-currency ETFs
The appearance of futures contracts for bitcoin has become a logical and fairly simple solution for cryptology. Such contracts are an attractive financial instrument that increases the liquidity of the first crypto currency. In the development of this direction, in the first place, traditional investors are interested, who did not enter into kriptonok because of high risks. And considering that the struggle between the CME Group and CBOE Global Markets has turned into a real race for the title of the first stock exchange offering bitcoin futures. In 2018 we will see an increase in the number of such financial products.
With crypto-currency ETFs (traded on the stock exchange), everything is more complicated. Despite the fact that the first steps in this direction were already taken last year, the financial authorities of most states are not ready to support such funds because of lack of regulation of kriptonka.
Nevertheless, in June 2017 the Swiss organization Crypto Fund AG announced the launch of the world’s first diversified crypto-currency fund. However, the press release of the company stresses that this fund is not ETF, as it is over-the-counter and is aimed only at qualified investors. At the same time, the Chicago Exchange of Options CBOE has sent to the US Securities and Exchange Commission (SEC) an application for the launch of six bitcoins-ETF.
3. Mass correction of altcoyins
As they say, cheaply got – easily lost. Now on the market there is a large number of crypto-investors, in the portfolios of which there are illiquid useless coins. These coins are usually offered on small stock exchanges with limited opportunities. With a mass correction of the market, which, for example, we have been seeing for the last few days, the sellers of such coins will not see the buyers, and they will look for any way out, resulting in recalculation and alteration of the altcoy courses.
4. Focus on the regulation of Crowds Sales
The December decision by the SEC to stop the ICO of the Californian company Munchee and force it to return the investors’ funds was an important step in creating regulations for the regulation of the mistakes. The SEC chairman also said that now the commission is working on creating a manual for ICO and a new method for regulating cryptology. These plans can become a reality already this year.
Thus, regulators will struggle with the organizers of Pump- and Dump-schemes, insider trading and any other attempts to manipulate kriptornke.
Due to the fact that cryptology is the first truly global and international environment that knows no boundaries, it will be interesting to see the results of such regulatory attempts.
5. The emergence of services for institutional players
The absence of traditional service providers in such areas as order management systems, accounting software, depositories, and other services needed by the market, prevents institutional players from entering cryptology. Once reliable and proven solutions are available in these categories, many of the risks associated with the world of crypto will no longer frighten large investors. In 2017, the first providers of such services began to appear on the market, but this year they have to prove their effectiveness if they want to attract institutional players.
6. The success of traders will depend on their skills
Last year, we saw many success stories from crypto traders. It is now clear that the revenue was more likely to be due to the growing market dynamics that was overheated in 2017, rather than with individual abilities. The participants of the cryptory will start looking for effective and thoughtful solutions, because with only luck they will not win. In 2018, professionals, not lucky ones, will be able to get a high income.
7. Increased volatility due to futures on crypto-currencies, options, and crypto-currency ETFs
As soon as such financial products begin to be popular on cryptology, we will immediately see their huge influence on trends. Since even on the traditional stock market several times a year there is a strong volatility, because of the events known to all players associated with derivative financial instruments.
As for krypton, there will be increased volatility here, especially when futures and other derivatives are closed, or rebalancing will be necessary.
8. We will see how at least one traditional investment-broker company goes bankrupt as a result of incorrect management of crypto-derivatives
In spite of the fact that already there are derivatives on Bitcoin in the form of futures, one must not forget that this basic asset is complicated in operation. One unsuccessful transaction or an incorrect line of code can cause irreparable harm to the company, which has no experience in working with crypto-currencies.
9. Cryptomarket is led by psychology
Trends in cryptology are often driven by a herd feeling that can cause a trader to believe that he or she can run the market through social networks. Such a platform for voicing your own opinion and a little luck can make an ordinary investor feel invulnerable. 2018 will prove that the market is ruled by insider information, and not the opinion of one trader and his followers.
10. Cryptocurrency in Fiat
The withdrawal of crypto currency in Fiat is a weak link in the crypto industry. Most exchanges provide a limit of $ 100,000 per month, and only for fully verified users. Thus, cashing your cryptosaving is extremely difficult, and Tether here will not help. In 2018, many players cryptology will be interested in solving this problem. And it is likely that this year new services will start appearing in the market, providing services for the withdrawal of crypto-currency in Fiat.
10 trends in the development of the crypto industry in 2018