After last year’s successful performance that saw cryptocurrencies like Bitcoin (BTC) challenge $20,000, 2018 has been a severe disappointment. But that will change for two key reasons.
One, the U.S. realizes it has fallen far behind the global community regarding cryptocurrencies
“Mobile payment providers, like Apply Pay and Samsung Pay, are being used at cash registers in countries like the United Kingdom and Japan, and people have responded well to the ease of this system and some of the benefits it provides,” says the World Economic Forum’s Sheila Warren. “But some countries, like the United States, are already falling behind in this race to adopt digital currency.
Two, Institutions are Slowly Waking up to Opportunity
According to Joey Krug, co-chief investment officer at Pantera Capital, “If you look at that next bull run, I think the crypto space overall could hit 10x from here.”
That could provide cryptocurrencies with a $2 trillion market cap.
Furthermore, he’s especially bullish thanks to news that Fidelity Investments and the ICE Bakkt are turning the industry on its head.
Fidelity is launching Fidelity Digital Asset Services, taking a big step into the field of cryptocurrencies. If done well, it may just help change the trust issue among institutions. Moreover, Bakkt will offer clearing and custody, as well as warehousing using cryptocurrencies.
Scalability is a key factor for the next bull run
Additionally, to increase the valuations of cryptocurrencies, the market must first overcome scalability issues. Therefore, Krug notes, it is currently similar to the Internet before dial-up.
“If you look at the internet, it’s easy to say, ‘Well, you just create an app, get some users, and then you solve the scalability problems.’ But these are all markets, and so if you don’t have scalability, you don’t have market makers, and so you don’t have liquidity.”
Remember, cryptocurrencies are still in its infancy.
As it progresses, we could very well see a $2 trillion market valuation, as Krug notes.
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