January 03, 2019 | AtoZ Markets -The past 2018 year was quiet difficult for the investors in the cryptocurrency market. Bitcoin (BTC) other cryptos have lost more than 80% of their price and others have completely vanished. Some ICO projects were affected as well; certain companies had to fire part of their employees, cut production or eliminate entire firm.
Regulatory Framework of the Crypto Market Has Improved
There are some positive things happening in the blockchain industry that are worth paying attention to. Financial authorities are trying to regulate crypto space, and the cryptocurrency infrastructure continues to expand against the backdrop of this bear market. One of the most important things that needs to be taken into account in the new year is the improvement of the regulatory framework of the crypto market. Another positive note is that despite the failure of some projects, most of the initial coin offerings (ICO) ventures expanded during the first half of 2018. Financial regulators are trying to create clear regulations for companies and individuals investing in the crypto space. The US Securities and Exchange Commission (SEC) will play an important role in the virtual currency and the blockchain market as it did before. This financial regulator investigates initial coin offerings in the ICO market to identify fraudulent projects. Some experts suggest that most ICOs will be labeled by SEC as securities offerings and this will complicate their use in the market. To avoid such classification, some ICO projects have adopted the term “security token”. According to the experts, the year 2019 will represent a year of improved regulatory clarity. The SEC may also clarify some other issues related to how to raise funds and how to work in the cryptocurrency space.
New Financial Institutions Will Appear in the Blockchain Industry
Another important trend, which according to the financial experts, may affect the market during 2019, is associated with the appearance of the new financial institutions on the market. The Intercontinental Exchange (ICE) decided to launch the Bakkt platform,that will let new major investors to place their funds on the cryptocurrency market without having to manage their funds on their own. Over the next months, Bakkt will launch bitcoin futures contracts. The launch was scheduled for January 24 but was later postponed until February. Futures contracts for Bitcoin offered by Bakkt will be calculated in Bitcoin, rather than in fiat currency, as the Chicago Mercantile Exchange (CME) and Chicago Stock Exchange Options Exchange (CBOE) are currently offering. NASDAQ also plans to offer bitcoin futures trading to investors in the market. Fidelity Investments is also working on a new cryptocurrency platform, which will allow firms to enter the cryptocurrency market. Other crypto exchanges and companies like Coinbase or eToro also invest in building similar platforms as Bakkt for institutions. According to the blockchain experts, this technology also has a period of new developments and improvements. Some banks, such as ING or Commerzbank, are already working with the blockchain platform Corda, created by R3 consortium. R3 also launched Corda Settler platform, which was specifically designed for corporate clients. IBM continues to work with World Wire network based on the Stellar blockchain. The company plans to offer a new service, similar to SWIFT, which is faster and cheaper. Ripple also intends to expand among banking and financial institutions that want to process cross-border payments.
Certain Exchanges Might Suffer from the New SEC Regulations
However, according to the financial analysts, some exchanges can be seriously affected if the SEC begins to classify tokens as securities. Such exchanges include Binance, which possess hundreds of tokens, and several of them were raised from ICO. Some exchanges will have to reckon with the new rules and exclude some coins if they are labeled as securities or simply avoid the US market. Perhaps in 2019 will appear the new groups of stock exchanges which will grow. eToro platform, which already works with the U.S. other countries' regulators is allowed to list ICO tokens. Coinbase also tried to comply with all the rules imposed by the United States.
Facebook, Amazon and Apple Believe in the Blockchain Future
Globally different companies are also starting to invest in the blockchain technology. Facebook created a group to explore the future of the blockchain. It is rumored that the company may soon launch a stable coin for WhatsApp users in India. Amazon is already working with the blockchain products and offers related services. Apple also filed a patent related to the blockchain technology. All this shows that in 2019 virtual currencies will continue to expand. Blockchain technology will also play an important role worldwide. However, how all changes will affect the price of the most popular cryptos remains unknown.
Think we missed something? Let us know in the comments section below