2016 has brought more drama in the world of cryptocurrencies: the rise and the fall of The DAO, Ethereum’s controversial hard fork and subsequent emergence of Ethereum Classic, and the attack on Bitfinex, among others. Certainly, all of us would like to know what’s on the table now.
ForkLog is happy to shed some light on the future and proudly presents a fortune telling session with some prominent players of the cryptocommunity. Sharing their thoughts were Lasha Antadze, project manager of Ukraine’s biggest blockchain project Auction 3.0; Alex Fork, founder of Future Fintech and board member of Blockchain.Community; Andrei Zamovsky, Ambisafe CEO; Nestor Dubnevych, legal advisor at Juscutum; Anatoly Knyazev, executive director of online broker EXANTE; the entire Cyber.Fund team; and Marina Gurieva, the Head of Innovations at the Higher School of Economy.
Many experts are sharing a common view that the cryptocurrency’s price is likely to grow further in 2017 with several factors supporting this idea: the overall upward trend throughout the entire year, increase in investments, more and more businesses directly or indirectly accepting bitcoins; and consumer interest growth. At the same time, there are other things like the scalability issue and other technical aspects of the network. So, what does the year of 2017 hold for Bitcoin?
Anatoly Knyazev: Nobody can tell for sure what the future holds for bitcoin, however, most predictions are quite optimistic. The year 2016 has probably become the most steady, positive, and calm year in the entire history of bitcoin. The price was steadily growing all year, and the information background was moderately positive. Cryptocurrencies and blockchain technologies entered official discussions. All those processes have laid a great foundation for bitcoin’s future. My biggest expectation for 2017 is about bitcoin the Winklevoss brothers’ ETF. If they get the permit, the ETF will become the first bitcoin investment tool officially recognized by all financial institutions in the world. Such an ETF will allow all kinds of investors to invest in cryptocurrency. The currency’s exchange rate is most likely to seriously grow.
Sasha Ivanov: Bitcoin will develop and grow, that’s for sure. Still, it will be quite a slow process due to various political issues. Bitcoin now is too big to fail, so there’ll be some consensus. However, Bitcoin Classic isn’t very likely to thrive.
Andrei Zamovsky: I think Bitcoin will be alright, yet the cryptocommunity will at last see that it isn’t very suitable for most blockchain-related projects due to expensiveness and low speed of transactions. For that reason, many new projects use Ethereum blockchain.
Marina Gurieva: Bitcoin will grow and adapt. The growth rate depends on the global economy as holders of unstable currencies will be switching to bitcoin. Also I’m waiting for the resolution on the ETF of the Winklevoss brothers. If the U.S. SEC resolves positively, it will result in great demand for bitcoin.
Lasha Antadze: We’ll see more bans on bitcoin operations in the Middle Asia countries. However, integration of bitcoin as a payment tool will only continue, so we’ll see lots of companies announcing that.
Nestor Dubnevych: Bitcoin will undergo scaling for two reasons. Firstly, it’s instability of national currencies. Secondly, and that’s more about ideology, it is the opportunity to put those freedoms the classic had written about to practice. Whereas Austria and Germany ban 500 Euro notes saying high-denomination bills help with money laundering and terrorism financing, bitcoin’s popularity as some sort of digital cash will only grow. It’s not really about illegal operations. The freedom to handle your own property is a part of natural and inherent human rights like the freedom of speech. But how could one practice that freedom if cashless economy is but a wolf in a sheep’s clothes? Under the guise of making life easier, it will establish total surveillance and obtain another item of control with the opportunity to cut out all possibilities to pay for anything. Bitcoin grants the right to pay with cash online. This option is its main advantage in the confrontation of the nation state with its animal instinct to control everything, and the freedoms of humans in whose best interests the nation state should have existed in the first place.
Alex Fork: In 2017, the infrastructure allowing for various bitcoin operations will continue developing. RSK might become the breakthrough product for bitcoin. As for Russia, the future of bitcoin and other cryptocurrencies will remain in the hands of lawmakers and regulators.
Cyber.Fund: We think bitcoin price will correct in early 2017, it may even go down. However, we may assume that eventually bitcoin will find its next foundation around $1,000 or even higher. Still, it’s only an opinion, so all traders should analyze the rate by themselves. Still, there are objective factors suggesting that bitcoin will grow expensive, i.e. steadily growing number of transactions and users.
The Future of Altcoins
This year, a few new stars emerged in the cryptoheavens, and many community members have high hopes for them. First of all, those are Monero and ZCash. Notwithstanding the falling price and network issues, Ethereum is still in the top of positive expectations. Let’s see what the experts have to say.
Alex Fork: In order to become outstanding, a cryptocurrency should have certain competitive edges. An example of such currency is ZCash launched this October. It has brought about a new standard for anonymity. This year cryptocurrencies are shifting towards blockchain platforms that, aside from their own features, have tokens traded at exchanges. This trend is likely to continue.
Andrei Zamovsky: I expect the quality of pump and dump coins to grow in two directions: (a) more complex models of financial tools, as nobody would be impressed by yet another cryptocurrency now; (b) most of them will represent new assets (smart contracts included) in existing blockchains instead of launching new ones.
Cyber.Fund: We pay the most attention to Ethereum. It’s very interesting how the team copes will all the problems in the network. We believe they’ll succeed. Also, we should pay attention to new anonymous cryptocurrencies. They have taken the bar and conquered that share of the market where there had been some demand for them long before their emergence.
And there are traditional currencies. We expect something bad to happen on traditional markets, which would result in even greater popularity of cryptocurrencies, so nearly everything we have on the market today will grow. It’s hard to be sure, of course, but in case of a global political/economic crisis people will turn to cryptocurrencies. We also believe that cryptocurrencies will take their niches due to bitcoin’s growing popularity. The market is very promising. However, first of all we believe in Steem and Golos. And, of course, Ethereum as it is the only place where one may safely create smart contracts.
Sasha Ivanov: Ethereum will be fighting (and probably vanquishing) its problems. There will be more specialized systems like Waves, which are to be focused on particular business problems. There might be some smart contract systems as Ethereum alternatives.
Nestor Dubnevych: Speaking about altcoins, I’d like to mention the so called national cryptocurrencies. I truly believe that GovTech will change nation states in the near future. When corrupted red tape apparatus dissolves, it will be replaced by transparent software algorithms. In this context, national cryptocurrencies should be considered yet another phase of a technological revolution in the government apparatus. What’s the point of installing a complex computerized autopilot on a wooden cart powered by cattle?
Lasha Antadze: I think, enthusiasm will shrink a bit in this industry. Many will understand that most cryptocurrencies are downright scam. Such currencies disappear almost immediately upon their launch due to lack of a business model, further funding, and unwillingness to do something really interesting. This will impact the market, so many of today’s applications with their own cryptotokens will remain only in history books. I think the trend of endlessly issuing altcoins will become unpopular. Even good projects will have to prove they’re not scam when they kick off.
Anatoly Knyazev: I believe other cryptocurrencies will remain an experimental sandbox for enthusiasts. The market will show extreme volatility, rises and falls, new technologies, and altogether everything the bitcoin market used to be loved and hated for. In 2016, the most important altcoin event was probably the rise of Ethereum, which is now the second most capitalized cryptocurrency after Bitcoin. Yet it’s not easy to say what happens to Ethereum and other altcoins in a year’s time.
Marina Gurieva: The future of any cryptocurrency depends on the coin itself and its team. Still, development of blockchain market and emergence of multiple real projects using blockchain (bitcoin’s or Ethereum’s) is guaranteed.
The Rising Tide of ICO’s
ICO’s start resembling lotteries: you either get lucky, or not. So many crypto-entrepreneurs liked the idea of fundraising without commitment, the next year is likely to bring about even more ICO’s. But will the quantity become quality?
Andrei Zamovsky: There’ll be more ICO’s. I think, within next few months it’ll become clear that most of current ICO’s have no economic value. Then the projects won’t be able to raise funds as easy as this year. The quality of legal token models will improve. We should expect many financial instruments issued as a part of an ICO to be registered accordingly in different jurisdictions, and therefore will be legally enforceable. Presently the only guarantee you have is their developers’ oath of honor.
Alex Fork: The summer’s attack on The DAO will make investors to be more careful with projects that raise funds via ICOs. The DAO’s experience allowed the blockchain community to make some valuable conclusions. ICO as a method of project funding will keep on developing. For instance, Waves offered the market a special blockchain platform for ICO campaigns.
Nestor Dubnevych: In order to understand what will become of this rising tide of ICO’s, we have to remember what happened when IndieGoGo and Kickstarter emerged back in 2008. Startups saw it wasn’t necessary to undergo expensive procedures of entering stock exchanges or spend weeks asking for money from investment funds. The hype of crowdfunding reemerged when the U.S. have passed so-called Jobs Act regulating the rules of fundraising via similar platforms from an unlimited group of people. I believe ICO’s will have a similar future.
Sasha Ivanov: ICO projects will seek to enter the existing business/legal reality, and there’ll be attempts at regulation. In fact, it will be the most decisive year for the ecosystem. It will show whether the new financial blockchain-based tools can succeed on the market.
Anatoly Knyazev: Many of those who earned something on BTC trading, as well as newcomer enthusiasts seek to earn money on growth of new projects. Others want to support the cryptoeconomy, and thus invest their funds notwithstanding enormous risks. The tide of ICO’s is most likely to rise and gain steam. Only a serious event like BTC price collapse could stop it. It’s not very likely but still possible. The trust in bitcoin is so serious the investors will consider its cheapening as a great opportunity for entry.
Cyber.Fund: We believe there’ll be more ICO’s. However, as most of us understand, the market today is full of scam. So it’s not quite right to say The DAO that had raised over $160 was a bad project. It was a great project at least because it has taught the industry much. We get stronger only when we discover such crucial errors. So, the ICO market will only grow as it grants the easiest access to money.
High Hopes for 2017
Just like it was last year, ForkLog hopes that the number of bitcoin users and our readers will only grow. Those two things are connected as work with cryptocurrencies implies some interest to events and news of cryptobusinesses. Information is probably the most powerful weapon in this game that still lacks pronounced rules.
Lasha Antadze: I expect blockchain to enter the active phase of taking over the corporate world. The very word will become even more ambiguous and obscure. Everything will be called and positioned as blockchain solutions. I expect new consensus algorithms to emerge, with completely different logic of reaching the consensus. Our blockchain auction will kick off in several countries (in addition to public auctions.) And once again we won’t find Satoshi.
Marina Gurieva: As for me, I hope that the number of non-pros using blockchain-based products or services will grow.
Nestor Dubnevych: I think I wait for the Chinese parliament to pass a law on property rights for cryptocurrency. There is a hot dispute in the world as to what bitcoin is in the light of existing legal systems, and what’s the best way for regulators to interpret it. However, the market’s only Moby Dick capable of setting off a wave that will flood other countries is China that’s holding nearly 90% of the world’s bitcoin turnover. Other players will look up to it. It’s the trend-setter.
Sasha Ivanov: My biggest expectation is realization of the potential we’ve seen in 2016, i.e. massive adoption of the technology and using blockchain ‘routinely.’
Alex Fork: My biggest expectation for 2017 is realization of my project Humaniq that might drive cryptoeconomy from the deadlock by including a billion of unbanked users in the global economy.
Andrei Zamovsky: It’s the approval of one of applications on blockchain issuance of shares by the U.S. SEC. This will create a precedent and give the go-ahead for a blockchain revolution on American financial markets.
Anatoly Knyazev: I’ve already told my biggest expectation for 2017 is about Winklevoss brothers’ bitcoin ETF. This fund has been striving for a permit to enter the exchange. If they have the permit, the ETF will become the first bitcoin investment tool officially recognized by all financial institutions of the world. Such an ETF will allow all kinds of investors to invest in cryptocurrency. The currency’s exchange rate is most likely to seriously grow.
Cyber.Fund: We have a few high hopes. The first great expectation is the launch of Ethereum’s new network. The second one is the release of decentralized storage project, the release of Holem, and emergence of projects focused on creation of ‘blockchain blockchains,’ or, as some call it, ‘the internet of blockchains.’ We’re also interested in assessing blockchain projects and ICO’s, and we plan to do it the next year. We also hope that bitcoin will experience the real ‘to the moon.’
One should realise that when we speak about $1,000/1 BTC, the global economy is about trillions of dollars. Bitcoin is mere $12 billion, it’s only dust. So the real ‘to the moon’ is about $10,000 / 1 BTC. We also expect massive adoption of blockchain in government operations and other sectors.