Cryptocurrency is one of the most popular terms in the present world. Of course, there were confusions with regard to the applicability and the usage of a cryptocurrency over the past few years. Many were not much confident about cryptocurrency. But still, it emerged as a trend. The significance of cryptocurrency kept growing day by day. It’s obvious that cryptocurrency has directed the world into a new direction. Therefore, it’s important to have a look at how the future of cryptocurrency will be.
But, before that, let’s have a quick glance on what cryptocurrency is, and how they evolved throughout. Here we go!
What is Cryptocurrency?
Simply, cryptocurrency is a form of virtual currency, based on a network which is distributed across a large number of computers. They create an opportunity for online secure payments. Furthermore, they are labelled as virtual ‘tokens’ that are represented by ledger entries internal to the system. There’s no central authority to issue cryptocurrencies. Hence, cryptocurrency lies external to the control of governments and the central authorities. Yet, cryptocurrency is secured with cryptography, which makes it non-viable to replicate or knock-off.
A Glimpse on the History of Cryptocurrency
As for the history of cryptocurrency, decades back, the cryptocurrency had been merely a theoretical construct. However, the technical foundation of cryptocurrencies dates back to the early 1980s.
That was when David Chaum invented the ‘blinding’ algorithm. It still remains central to modern web-based encryption. Later on, Chaum along with his team founded DigiCash, which was a company that produced units of currency based on the blinding algorithm. Next invention down the line was Wei Dai’s white paper on b-money. Then comes Nick Szabo’s cryptocurrency named Bit Gold.
These are the most significant milestones in the history of cryptocurrency. It is certain that they have paved the path to the modern cryptocurrency boom.
Types of Modern cryptocurrency
We are now in the middle of an era of a cryptocurrency explosion. Therefore, most of us are aware of the main types of cryptocurrencies used in the present. Yet, it is important to have a brief idea of what these types really are.
Bitcoin is well-known as the first modern cryptocurrency. Blockchain technology, which is a decentralized ledger system, is used to develop, distribute, trade and store Bitcoins. Litecoin can be known as an alternative for Bitcoin. It seemed to be faster and cheaper than Bitcoins. Hence, it could maintain a good market share for a considerable time period, until other altcoins took away some of Litecoin’s market share. And then comes Ethereum. It is not so popular as Bitcoins, but some predict that it might be the world’s top cryptocurrency within a short time period.
However, among all of them, Bitcoin attracted the world in a way that no one predicted. Hence, many types of research were initiated and carried on with regard to the field of cryptocurrency. As a result, Bitcoin-related payment settling, currency exchange, and remittance systems have come up in the present world.
A Look into the Future!
When considering the journey of cryptocurrency so far, it’s true that it has failed to maintain its perfect high profile all the time. It had its own ups and downs. In 2017, cryptocurrency marked a record-breaking rise. Then in 2018, it had a striking crash, and in 2019 cryptocurrencies had a considerably low profile. Yet, it’s the nature of disruptive technologies and trends to have highs and lows. Hence, despite these fluctuations, several personalities and organizations from various domains have looked into the future of cryptocurrency.
Having a good idea on what cryptocurrency is and how it evolved throughout, let us now have a glance at the predictions on the future of cryptocurrency.
01. Cryptocurrency will integrate with the Internet of Things (IoT)
At present, most of the popular cryptocurrencies, such as Bitcoin and Ethereum are based on Blockchain technology. It is obvious that the blockchain concept is being more strengthened, and is adopted by a number of domains in the present. However, technology specialists predict that the merge of Blockchain Technology along with the Internet of Things (IoT) to facilitate cryptocurrencies will occur in the years to come.
Have you ever thought of your personal car buying its own fuel? Well, it can be made a reality with the merge of Cryptocurrency and IoT. That’s wonderful, isn’t it? Let’s assume that a car is integrated with an internet system. If IoT collaborates with cryptocurrencies, then the car has the ability to purchase fuel on its own with the owner’s cryptocurrency. The owner’s physical currency will not be spent at all on the purchase. This can have a minor effect on personal usage at a glance. Yet, it can have a major impact on large-scale industrial usages.
Likewise, if this integration between IoT and cryptocurrency takes place, it will create a highly scalable and secure framework for communication between IoT devices. Moreover, cryptocurrencies will have the stability to make micro-investments for smart devices in a more efficient manner.
02. Bitcoin will stand strong.
As Investopedia reports, the price per Bitcoin reached a peak of nearly $20,000 in late 2017. And then it has fluctuated quite a bit, averaging at about $7000 as of April 2020. Forbes reported a quick shift of Bitcoin price that took place even a few days back, in early May 2020. Likewise, the currency has massive rises and falls in the journey throughout. Yet, many predict that Bitcoin will stand strong in the years to come as well.
Even in the last decade, there was a question about whether Bitcoin would even survive. There were a number of articles written about the end of Bitcoin. Yet, it had the ability to pull through. Bitcoin was even able to become the top-performing asset of the decade. Several reasons lie behind this success. Bitcoin holds the transparency that no bank can match. And another significance is that Bitcoin has got no financial intermediaries. That’s obviously a plus point in the present economic status. Furthermore, it is said that Bitcoin can be trusted more than the majority of the government currencies. Considering all these facts, we can believe in the prediction of Bitcoin standing strong. It has no chance of dying in the near future.
03. New cryptocurrencies will emerge.
Nowadays, the most popular cryptocurrencies such as Bitcoins, Ethereum, and Litecoins are ruling the world of digital assets. They belong to the first batch of Blockchain-powered cryptocurrencies. Stablecoin, which is not yet that much popular, is next in line in the journey of cryptocurrency. However, when cryptocurrencies keep entering new domains, various requirements might definitely come up. Apart from that, the technology will keep evolving. As far as the world endorses cryptocurrency, higher the chances will be for more new cryptocurrencies.
The emerging cryptocurrency will be designed in order to cater to the latest requirements. Due to that reason, most of the new cryptocurrencies will be way more innovative and developed. Anyway, innovations won’t stop. So, we might hear about new cryptocurrencies with various amazing features in the years to come.
04. Cryptocurrency will invade the future of banking.
The rapid development in technology has influenced a drastic change in the life patterns of humans worldwide. Accordingly, people shop differently, buy music differently, and live totally differently. They spend most of their time with their smartphones in their hands. This has made the countries rethink their economic patterns. This has made the banking sector digitize up to a certain level at the present. But this change is evolutionary and the technology keeps changing further. Hence, it’s predicted that cryptocurrency will invade the future of banking with no time.
Cryptocurrency will take some time to get popular as pounds or dollars. But still, it is predicted that the banks will initiate this concept of using cryptocurrency as an alternative service for their customers. The approach of introducing new trends as alternative options for the customers has been a successful move even in the past. This is one of the approaches that the banks used when adapting online banking services as well. Therefore, several parties predict that the banking systems would adapt cryptocurrency services as an alternative to incline their customers for the future.
However, to go ahead with this concept, the governments will have to permit their banking systems with a license. Therefore, it might take some considerable time for this legislative process to be finalized in countries worldwide. Yet, few countries in the world have already introduced acts related to digital asset business to support their global financial companies to embrace cryptocurrency. Whatever the field it is, early adopters would play a major role in the expansion of a service. There is a massive crowd interested in trading and investing in cryptocurrency due to various reasons. Hence, it’s predictable that the future of banking systems will depend on cryptocurrency by the dawn of the next decade.
05. Governments will adopt cryptocurrency.
If a government takes the step of regulating cryptocurrency for the banking sector, it would most probably adopt cryptocurrency for its agencies as the next step. With this process, blockchain technology automatically comes into action. Hence, this would be an instance where the governments will have double benefits.
Cryptocurrencies would help the government to manage the cash flows between agencies, as well as with external parties in a better way. Apart from that, most of the government agencies follow a traditional method of maintaining separate databases. Yet, there are certain agencies that are depending on each other. With the Blockchain technology, the collaborations and the integrated process would be highly efficient. It would have a huge impact on data management processes.
06. The gaming industry will revolve around cryptocurrency.
Of course, here comes something interesting! The gaming industry is one of the main domains in which the non-standard digital currencies were used from some time back. Even in the past several companies involved in the gaming industry used their own methods to fulfil their payments purposes. Therefore, the concepts related to cryptocurrencies and blockchain are not new for them. It is a field that can easily adapt to cryptocurrencies. This is the reason why the gaming industry is used as a testing ground for various blockchain-related and cryptocurrency-related functionalities.
Gamers being a tech-savvy group of people, there’s no doubt that they will embrace cryptocurrency easily in no time. Moreover, this is an era in which e-sports are reaching a new level of popularity. However, the best way for cryptocurrency to enter the gaming industry is as an alternative for card-based online transactions. Then the players can use cryptocurrency to buy gear and virtual assets. Furthermore, the blockchain technology that comes as the tech power of cryptocurrency will add more value to their games. It will enable the players’ gear to be recorded in a memorable way.
This will even create an opportunity for financial companies to come up with a new cryptocurrency. Therefore, with the expansion of cryptocurrencies, it is predicted that the gaming industry will very soon revolve around these concepts for real uses. And who knows, the change in the world with cryptocurrencies might even start with games.
All these future predictions are based on projections made by professionals involved in various domains. These forecasts might or might not come into reality. However, let’s see how many of them will happen in the real world in the years to come.
Whatever it is, no one can argue the fact that cryptocurrency will get into the hands of a lot more users in the future. Cryptocurrency has advantages in terms of liquidity and accessibility. It can be traded easily. Cryptocurrency offers greater transparency when it comes to transactions. And the cryptocurrency transactions are immutable. So who can say that cryptocurrency will die? It will continue to develop and grow. The future is yet to be unveiled, yet predictions keep us going. Let’s see how it goes!