Review: My crypto crystal ball 2019 – and an outlook for 2020

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One year ago, I published a medium story about what to expect from the crypto and blockchain landscape in 2019. Turns out I was too optimistic. While I still firmly believe in the direction of my predictions, most of these innovations obviously need more time to reach the mass markets.

Photo by Jude Beck on Unsplash

But let’s dive into the different predictions:

#1 Mobile crypto wallets

Prediction: End of 2019 we will see at least 3 mobile crypto wallets in the Top20 of the “Finance” section in the iOS app store.
Photo by Jonas Leupe on Unsplash

I totally failed with this one – at least from a German perspective. Crypto didn’t go mainstream in 2019. End of 2019, Apple lists the app of Coinbase as #51 in Finance, Bison (the well-received crypto app of Börse Stuttgart) at #88, and BRD at #97.

On the positive side, we saw some great UX progress in the B2C area: Wallet features are integrated into common (d)apps. On-boarding of users is improved considerably. Gone are the times, when your first job was to write down your 24 words seed phrase when you look at groundbreaking apps like OST’s Pepo or Argent wallet. Hardware devices like Ledger’s Nano X help to secure mobile wallets significantly.

Even multi-sig approaches (for funds held by companies or groups of people) are immensely improved if you look at Gnosis and their brand-new multi-sig wallet. It is planned to go mobile 2020. Institution-grade hardware solutions like those of Riddle&Code or Ledger Vault also go for mobile solutions. Let’s see what happens 2020…

#2 Stable Coins

Prediction: End of 2019 we will see at least 3 stable coins in the Top 10 at coinmarketcap.com regarding market capitalization.

I wasn’t too bad with this one but failed again.

First the facts:
Tether (USDT) currently ranks as #4 on Coinmarketcap.com, USDC is #20, PAX is #31.

MakerDAO’s recently launched (11/2019) multi-collateral DAI isn’t yet ranked properly after its split from SAI (single-collateral DAI). You can find interesting statistics on DAI at DefiPulse or DAI stats. At the time of writing, the impressive amount of 340M$ of cryptocurrencies is locked into MakerDAO’s smart contracts.

2019 was an important year for stable coins, especially after Facebook announced its Libra project — with the Libra stable coin at its front and center (see next chapter). Stable coins are here to stay — whether they are backed by fiat currencies or other, more volatile crypto assets — like Maker’s DAI.

Currently, stable coins are primarily used in crypto trading. Many centralized exchanges offer trading pairs of altcoins with e.g. USDT. Thus, traders can use stable coins to buy altcoins instead of going through ETH or BTC.

But there are also interesting use cases for stable coins if you live in a country with high inflation like Argentina, as Mariano Conti explained in his impressive talk at Ethereum’s DevCon V in Osaka:

#3 Sending (crypto) money via your favorite messenger

Prediction: Facebook will follow suit and offer crypto payment features in WhatsApp or Facebook Messenger until end of 2019 – and many of us will use them. [Maybe they’ll even launch their own FB Token to win back some love of their user base?]

Well, Facebook’s Libra project was certainly THE news in 2019 – even if it isn’t launched yet. Designed as a fiat-backed stable coin, Libra made it to the headlines of mainstream media. Many politicians woke up. Even US congress invited Facebook's representatives on July 27th to answer their questions – comparing Libra to Bitcoin — and discussing Libra’s impact on nation states’ currencies like the USD. One could literally feel more sympathy for Bitcoin’s decentralized setup in these hearings – what an achievement for Bitcoin…

As a consequence, Central Bank Digital Currencies (CBDC) are the hot topic now — several states including China feel the need to respond to Facebook’s approach and innovate towards digital currencies and leverage the advantages of Blockchain technologies — even it is far away from the original decentralized mindset behind Bitcoin.

But while everybody speculates on Libra, other messenger projects are already live and growing. E.g. Parachute enables Telegram users to send 40 different crypto tokens via a chat message through their ParJar interface — including prominent currencies like $BTC and $ETH. One of the coolest features is that you can denominate the amount in fiat money, like in “/tip 10 USD BTC” — sending BTC worth 10 USD to a friend (find details here). That’s how the future could look like…

#4 Crypto-backed credit cards

Prediction: We will see more than 1 million crypto-enabled debit & credit cards issued in 2019.
[I guess most of them will be used in emerging countries in Asia, Africa and South America.]
Photo by Ales Nesetril on Unsplash

It is hard to judge how many people actually use crypto-backed credit cards. There are indeed many offerings (30+) for crypto-backed debit and credit cards, yet they are far from mainstream. The main reason is that crypto is usually still not used for payments due to several reasons:

  1. The volatility of main cryptocurrencies.
  2. Transaction costs are too high.
  3. Unclear tax issues (most crypto-payments are tax-relevant events)
  4. The finality of transactions: the „settling“ of crypto transactions still takes seconds to minutes (certainly depending on the protocol).

Second layer protocols like Bitcoin’s Lightning Network are about to eliminate problems like transaction cost and faster finality, but let’s be honest: we are not there yet and it might take some more years for “prime time”. Most people are still HODLing their crypto assets and actually don’t use them to pay their pizza…

#5 NFTs & Crypto-Collectibles

Prediction: At least one NFT-based art platform like Maecenas (pictures) or Ujo (music) will gain traction in 2019 and have more than a million users signed-up until end of 2019.
Photo by Daian Gan from Pexels

I was utterly wrong with this prediction. NFT-based art wasn’t a big topic in 2019. Maecenas didn’t post any significant update in 2019, Ujo was also very silent — just experimenting with state-channels for cheaper payments.

But people in very different areas heavily think about leveraging NFTs:
E.g. Ocean Protocol tries to use non-fungible data tokens in their data economy. Companies like Stryking partner with brands like Bayern Munich to sell collectibles. Market places for crypto-collectibles like OpenSea gradually mature.

#6 Token-based Games

Prediction: We will see at least 5 successful computer games (each >500.000 users) using crypto tokens as in-game currency or NFTs as in-game assets.
Photo by JESHOOTS.com from Pexels

Failed again. Gods Unchained is currently the most prominent crypto-backed game. Its creator Immutable raised 15M$ in September. The game is using Ethereum’s non-fungible tokens and currently has around 3200 token holders according to Etherscan. It will be interesting to see further developments in the game industry.

2020 will bring some interesting developments for NFTs: Panini, one of the big players in sports collectibles, just has announced to use NFTs for their sports stars collectibles. Yes, we’ll see Kobe Bryant and Neymar on Blockchain.

#7 Loyalty Programs

Prediction: In 2019 we will see at least 3 significant token-based loyalty systems, each having more than 100.000 users.

Again: not there yet. Obviously, many projects in this space are still suffering from the shortcomings (speed, scalability, UX) of their blockchain base protocol as you can read between the lines of this post of Carry Protocol.

Other projects like OST try to circumvent these technical problems by creating their very own second layer solutions (in this case Ethereum side-chains) and Token and Mobile SDKs. While OST did make some significant development progress in 2019 and launched first loyalty programs like their LGBT tokens for Hornet, there is still a way to go before hitting mainstream usage.

What I didn’t see coming…

Photo by Paul Hanaoka on Unsplash

There are some developments that I certainly didn’t see coming to that extent.

For example, the #DeFi movement around MakerDAO, Compound, dydx or Synthetix pushed Ethereum into a new narrative and created a whole ecosystem of building blocks for decentralized finance.

I also didn’t expect politics to get that much involved into Blockchain in 2019. Especially the German government laid important foundations for blockchain adoption — some even proclaiming Germany to become “crypro heaven”. Let’s see what happens. Currently, there is a lot of movement in Germany regarding Security Token Offerings (STOs).

Summary

I’m obviously really bad at predicting the future — at least regarding measurable numbers. ;-)
Many of my favorite use cases will take more time to become a reality.

While disruptive innovations like most of the ones above are very interesting to think about, they are really hard to bring to the masses. The hard thing about innovation isn’t about having a great idea — it’s the execution that always needs a lot of dedication and perseverance.

Thus, it might be the simple, incremental improvements that bring blockchain technologies into the mainstream in the first place. The main advantage might be as simple as “getting rid of paper” in the end. The main changes might happen “behind the scenes” — without anybody noticing.

Disclaimer: This article is not intended to be investment advice of any sort. Do your own research and search for professional support if you intend to invest in one of the projects mentioned in this article.

Further reading: If you liked this story, you might also want to check out my earlier work about “Democratizing the digital markets” or my “Blockchain vNext series”.

You are also welcome to follow me on Twitter or get in touch via LinkedIn (but please tell me that you found me via Medium).


Review: My crypto crystal ball 2019 – and an outlook for 2020 was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.