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Five predictions for digital currencies in 2018

Published on: 2018-01-06

(This post is taken from https://www.cnbc.com/2018/01/05/five-predictions-for-digital-currencies-in-2018.html )

1. More institutions will get into cryptocurrencies

The number of institutional-level investment products related to bitcoin is increasing. In addition to the CME and Cboe bitcoin futures that launched in December, Cantor Fitzgerald and Nasdaq are planning their own derivatives products. Analysts also expect regulators will approve a bitcoin exchange-traded fund in the second half of this year, or in early 2019.

2. There will be more regulation and bitcoin's price will drop.

Regulators will likely try to limit speculation in cryptocurrencies. In the last several months, the SEC has become increasingly vocal in warning investors about the risks of cryptocurrencies. The commission also has suspended trading in some companies due to concerns about their claims regarding their token-related announcements.

3. It will be a wild, volatile ride

The contrasting views on the future of cryptofunds come as some analysts expect bitcoin to ride an even wilder wave this year. Ari Paul, chief investment officer of cryptocurrency investment firm BlockTower Capital, predicts that bitcoin will trade at both $4,000 and $30,000 at some point in 2018.

4. Bitcoin will prevail, while other cryptocurrencies grow

While bitcoin's price has stagnated in the last two weeks, smaller digital currencies such as ripple, stellar and tron have surged into the ranks of the largest cryptocurrencies by market capitalization.

Erik Voorhees, CEO of digital asset exchange ShapeShift, said that in contrast to bitcoin's dominance on the platform a year ago, about half of transactions on the platform now don't involve the popular digital currency at all. However, bitcoin should still benefit from the increased interest in the "alt-coins."

5. Stock investors may get a chance to invest in a digital currency-related IPO

As interest in digital currencies has grown, the companies involved with the business have become billion-dollar entities. Leading U.S. cryptocurrency marketplace Coinbase, valued at $1.6 billion, has indicated it could pursue an initial public offering.

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