Digital currencies go mainstream – 3 predictions for 2017
Over the last couple of months we’ve been getting our heads around the booming crypto-currency market on behalf of a new client. In that time the most famous currency, Bitcoin, surpassed the price of an ounce of gold and has since almost doubled. In the last fortnight, cyber-terrorists have tried to hold the NHS to ransom, demanding payment in Bitcoin. Digital currencies might have been the preserve of tech-heads, but the mainstream won’t be ignoring them for much longer. Here are our three predictions for the coming months…
We’ll see beyond Bitcoin
Bitcoin grabs all the attention, but there are over 800 digital currencies, with more launching every day. Some aren’t entirely serious (TrumpCoin or Halloween Coin spring to mind) but some major players are emerging. The crypto-currency market is worth $70bn, and only half of that is Bitcoin. Ones you’ll be hearing about next include:
Ethereum – the pioneers of smart contracts. Think of it like ‘programmable money’; this new technology could massively disrupt the way business is done, and take a lot of money out of the pockets of corporate lawyers. Read more here.
Ripple – the one for banking. Most crypto-currencies are designed as an alternative to the world of traditional finance, but Ripple is aiming to be the system banks use to exchange funds globally. Already, dozens of Japanese banks are on board.
New Economic Movement – the Bernie Sanders of crypto-currency, this is powered by an idealistic community and trying to bring about “a new economy based on the principles of financial freedom, decentralization, equality and solidarity”. The 4th biggest coin, it has grown by over 2000% in the last couple of months.
The currencies will grow up
Right now, most governments and corporations are wary about digital currencies, and rightly so – most of them are trying to wrest control of money from the hands of governments. The US recently refused to regulate an investment fund for Bitcoin, which would have allowed for mainstream and institutional investors to get involved. The anonymity of these coins makes tax evasion and criminal use too easy. But it is only a matter of time until a more pragmatic, regulator-friendly crypto-currency finds mainstream adoption. Then the rest of the world will follow the lead of Japan, which already recognises Bitcoin as legal tender.
Crypto-currency will become useful
It’s all very well crypto-currencies exploding in value, but what is the point if you can’t spend them, except in the odd hipster hangout in East London? 2017 will be the year digital currencies crack mass usage. Already Ulmart, the Amazon of Russia, takes Bitcoin. Expect to be stuck behind someone paying for their Costa with a crypto-coin soon.
But the real use won’t come from the currencies themselves, but from the blockchain, the underlying technology. Think of it like a massive database spread across millions of computers worldwide, that can’t be tampered with. It is bringing trust and certainty to the most dodgy corners of the web. The one that might be most relevant to our business? Brave is one of a number of start-ups promising to use blockchain technology to prevent digital ad fraud, said to cost the industry over $16bn this year.
Those are our predictions, but things are changing fast, so watch this space. TrumpCoin could surprise us all…