I will confess. I am a huge believe in the future of Bitcoin and a number of other cryptocurrencies. Over the last few years, I’ve seen coins I’ve invested in multiply in value in some case by a favor of 100, but at the same time spectacularly dive in price just as quickly.
With the brutal 2018 and a less than stellar start to 2019, public sentiment on cryptocurrencies is undoubtedly down. Many look at them as another example of a get-rich quick scam whose time has come and and gone. Take Bitcoin for example. After scaling to heights of almost $20,000 per coin, it sits today somewhere in the $4,000 range. Even worse, many of the other popular altcoins have crashed or completely disappeared as consumers have lost faith in what many once saw as “digital gold”.
And yes, I’ve heard all the detractors.
“It’s the next Tulip Mania”
“It never had any value to begin with”
“Nothing but a high-profile Ponzi scheme”
Many who looked as Bitcoin as a express way to riches may feel burned, but as any good investor should do, you need to take a long term view to an investment. Over the course of its history Bitcoin has seen huge spikes and drops in price. Every time it has crashed from all-time highs, the headlines have proclaimed the “inevitable death of Bitcoin”. However, even today, at the current price, Bitcoin is still thousand of times above what you could have purchased it for in irs early stages.
Without questions, challenges still remain in the marketplace. First of all, it’s not a seamless process to invest in cryptos to this point. While US institutions like Coinbase and Robinhood have simplified the process immensely, work still needs to be done to make it easier for the average investor to take part. On top of that, to this point there still is not a lot of places where one can easily spend their Bitcoin.
Despite all the negativity, I’m still bullish about the prospects for cryptocurrencies going forward. First of all, I still believe in the premise of why they were created. Bitcoin, the most well known crypto was designed to be a secure method of peer to peer payment. The eventual hope was that it could serve as the eventual replacement for fiat money. While this was overly ambitious, it’s hard to argue with the idea of benefits of a systems that could offer the ability to take ownership of your hard earned money outside of governmental control. In that sense, there is no central authority that controls the currency. Instead it utilizes a “trustless” model where no one person is dependent on trusting the other to make the transaction.
Why 2019 Could Be a Gamechanger for Cryptos
On top of all this, there are a number of significant events on the near horizon that could have major implications and address many of the problems that have plagued the system. Coupled together, these developments could easily create a wave that send Bitcoin and others to new heights.
The Promising New Crypto Exchanges
Sometime in 2019, will see the launch of two major cryptocurrency platforms Bakkt and Fidelity Digital Assets.
Bakkt will be a federally regulated marketplace for digital currencies launched by ICE, owners of the New York Stock Exchange and supported by powerhouse companies such as Microsoft and Starbucks. Upon its opening, Bakkt promises to offers a scalable crypto platform, that will offer secure and reliable storage of Bitcoin. It will also offer a payment platform that will make it easier for consumers to make everyday purchases.
On the other hand, Fidelity is one of the largest asset funds in the world with over 7 Trillion dollars under management. They will be launching Fidelity Digital Assets. The benefit of this platform? That comes in the form of the 27 million customers who currently hold 401k accounts with Fidelity will soon be able to purchase Bitcoin and other digital tokens into their accounts.
The upside of these highly regulated and secure platforms will be that large banks, fund managers and financial institutions will be able to invest more readily than with the current platforms. Wall Street will then be able to offer Bitcoin funds as alternatives to stocks and bonds as investment options. This could allow an influx of trillions of dollars into cryptos. Once this kind of support is thrown behind cryptos, consumer confidence will soar, as will values.
The Inevitable ETFs
2019 should also bring the first Cryoto ETFs (exchange-traded funds) in to the market.Several promising proposals are currently in the works including a joint venture by CBOE (owners of the Chicago Board Options Exchange) and VanEck. To this point, several ETF applications have previously been denied by the Government but this is a good thing. The scrutiny they are bringing to the process will force the applicants to work out system kinks and make what will be a safer, more secure offering. However, once one ETF is approved, the floodgates will open and offer a variety of choices to take part in for investing purposes.
ETFs are popular because they allow investors to buy into popular trends or industries. Instead of needing to understand the specifics of each digital coin, consumers could choose offerings that provide a basket of tokens. Additionally, ETFs would certainly make it easier for individuals to invest in crypto without the complications of opening accounts on crypto exchanges. Instead, you’d be able to invest from your own personal investment platforms. Overall, ETFs will provide another safe and trusted avenue for deep-pocketed investors to put some financial weight ito the crypto market
The Facebook and Amazon Effect
Then there are the consumer powerhouses. Facebook and Amazon are two of the largest global brands and in recent months both of these business titans have been linked to Cryptocurrency projects. Once they throw their support behind the viability of such digital tokens, it won’t take much foresight to see major players like Google and Apple right behind them. Could you imagine the bump something like BitCoin would receive if Amazon started accepted payments with the currency?
With so many promising developments, 2019 could prove to be a transformational year for cryptocurrencies. The upside of these projects will be increased exposure and enhanced consumer trust. Given the low entry points many of these coins currently offer, there is certainly an opportunity to get in at reasonable prices ar a chance for some truly spectacular runs.
I’m not telling anyone how to invest their hard earned money, but I think if someone takes the time to analyzes the monumental opportunity here, it’s fairly obvious this is a low risk, high reward opportunity. It certainly won’t hurt to allocate a small portion of your savings to see how it performs over the course of the year as these new developments become reality. If you want to get started, check out Coinbase, the largest and most trusted cryptocurrency in the world. Right now they offer a handful of coin options, including the most popular ones such as Bitcoin, Ethereum, Litecoin, and more.
Fortunes will be made in this space in the years to come. Will you be one of the people who takes part in what could be a life-altering opportunity or sit on the sidelines while others reap all the gains? I know what the answer is for me!