EKMH Innovators Interview Series: 2020 Blockchain Predictions Week
An interview series spotlighting global tech influencers, disruptors, visionaries, and of course, innovators.
‘Tis the season for reflections and looking ahead to the new year. To celebrate the holidays, this week the Innovators Series focuses on the Blockchain, Crypto and Fintech predictions of mavericks and mavens in the sector.
Earlier this fall I had the opportunity to interview OKEx Head of Operations Andy Cheung and circled back with him to share his predictions for the blockchain, crypto and digital assets sectors. Keep reading to learn Chueng’s detailed view for what’s in store in 2020:
*While 2019 was a transformative year for cryptocurrency and blockchain technology, I believe 2020 could be even more monumental. Bitcoin was the best performing asset class by a wide margin, and this itself draws the interest of investors. It continues to unlock a global, open market for financial services during a period when many nations are closing their borders. Because of this, we would not be surprised to see the price of Bitcoin rise again.
*Next year, we expect to see further expansion of global payments that do not come from legacy banking institutions. Bitcoin and other digital currencies have changed the financial landscape and shifted the way we look at all assets. The open-source ethos of cryptocurrency has put institutions on notice, and we expect all financial services to be disrupted forever.
*We expect more banks to adopt the ‘If you can’t beat them, join them’ policy in 2020. In this regard, we will also see more big names in the tech industry like Amazon coming into the blockchain and cryptocurrency sector. Every institution from Berkshire Hathaway to Barclays will be impacted by the evolution happening in these markets, and we see this trend accelerating regardless of regulation, security or price volatility.
*Of course, we still see many jurisdictions pushing back on cryptocurrency through regulations, but we do believe by year-end 2020, we will see a Bitcoin ETF listed in the United States. This event could be the catalyst to push Bitcoin above $14,000. One of the main drivers for this expectation is that similar ETFs have already been approved in Europe, and we also believe that the demand for this investment is widespread amongst traditional investors and institutional investors – we expect regulators will be willing to forge a compromise. It is worth noting that the largest accounting firms - Deloitte, PwC, EY, and KPMG – have already adopted digital currency accounting platforms. In addition, we see the derivatives market as a stabilizer, which should also help regulators to look favorably on a Bitcoin ETF.
*OKEx’s derivatives market is the most robust in the industry and a categorical leader; it is easy to see that derivative volumes across the industry have increased exponentially from last year. These markets are in high demand because they are an important tool for cryptocurrency investors. We expect to see more and more institutional investors enter the crypto markets in 2020 as education around digital assets improves. This is one reason that innovation has remained so important in this industry - we need to be prepared for accelerated growth in the crypto markets. At OKEx, we’re a one-stop-shop for cryptocurrency traders. Just recently, we launched USDT Futures trading and the OKEx Pool staking service to positive received positive reviews from the investing community. We also just announced the launch of Options Trading, which will go live in late December.
*Also in 2020, we expect mergers and acquisitions to accelerate in the cryptocurrency sector across both exchanges and technology. In a similar vein, we do believe exchanges will work more harmoniously toward regulation and pricing, which our SRO directly addresses. In order to achieve full compliance and trust in the industry, exchanges have to work diligently to regulate themselves.
*On the funding side, ICO fundraising will continue to be replaced by IEOs and Security Token Offerings. STOs have had some trouble gaining momentum over the years, but we believe there will be a time where nearly all assets will tokenize with a lower cost and more efficient system in place. The opportunity to tokenize assets like securities, energy, real estate, and art is a natural outgrowth of the current disruption we are experiencing. STOs can portion out larger assets and give investors peace of mind on the regulatory side.
*Another development we expect to take shape in 2020 is the growth of the cryptocurrency market outside of Bitcoin. We believe that Bitcoin will continue as a benchmark of the broader cryptocurrency space. At the same time, we see the narrative of major altcoins has been shifting from being a just a utility token towards more high-value transactions, even as a store of value. We see this shift will increasingly noticeable next year as altcoins mature and demonstrate additional use cases to stakeholders and the investment community.
*Originally published 16 December 2019.