The future of Bitcoin and other cryptocurrencies has long been up for debate, since they are such complex items in a complex world of financial changes and growth. As such, it’s hard to nail down exactly what, say, the next ten years might hold for Bitcoin. However, there are some general market trends that may be indicative of the future of crypto.

Finance sites like Bloomberg, Yahoo, and Binance frequently assess the factors that could drive Bitcoin’s future value. These sites have recently been reporting on not only Bitcoin’s price but that of other cryptocurrencies, such as Ethereum price USD, amid the US presidential elections. US and international politics have often affected Bitcoin’s price.

US Elections

Business Insider has said, “The presidential election has the potential to reshape the investment landscape.” The report quoted Bernstein analyst Gautam Chhugani predicting a Bitcoin rise if Donald Trump were to win. Bitcoin could rise from its recent price of around $70,000 to 90k by December. Kamala Harris is “seen as slightly less bullish than Trump”, but some observers are predicting an upswing no matter who becomes President. Blackrock CEO Larry Fink said that he wasn’t sure it would “make a difference”, his belief being that “the utilization of digital assets” will grow regardless. 

Increased Regulation

At first reading, this may seem like a bleak forecast of a future where crypto is cracked down on. This is probably very unlikely. The reason for this is that there are already a great number of variable and complex assets available on the open market for trading. It can only be a good thing for traders themselves and the market as a whole to have more potential assets and liabilities available for trading and borrowing, particularly if these assets have increased legal rights and responsibilities. This may increase market activity over time, leading to relatively unprecedented growth in the financial sector.

In January, US regulators approved US-listed exchange traded funds (ETFs) for bitcoin. Reuters called it a “watershed for the world’s largest cryptocurrency and the broader crypto industry.” An ETF allows investors to invest in assets more easily, without having to directly buy those assets. The 11 applications approved included those from BlackRock and ArkInvestments/21Shares. Douglas Yones, who heads ETFs at the New York Stock Exchange, called the approval a “milestone” for the ETF industry.

Analysts predicted a surge in Bitcoin’s price, which has proven true, as it hit an all-time high in March and is hovering around that point again this fall. The Guardian reported on the price of Ethereum rising amid speculation that fund managers will create Ethereum ETFs. Ethereum’s price rose in the spring, but has more recently dipped to around the levels of January and February, standing at $2,639 at the time of writing.

Not so long ago, many people got into financial trading with the goal of making money from GameStop stock. While that event has come and gone, it taught a crucial lesson: people want a piece of the action! They see traders on Wall Street making big profits, and they want to be able to take a slice of that pie for themselves. With the advent of an increased number of assets, particularly assets that are commonly created by and within the community, like crypto assets, it’s likely that we’ll see these surges of activity again and again.

Stablecoins

Stablecoins have been an interesting issue within the crypto space. Realistically, they’ve just been something that people have been paying a lot of attention to because they’re separate from the pack: while other coins can vary wildly in their price, stablecoins don’t.

If you’re unaware of these coins, the concept of them is simple. Essentially, their intrinsic value tends to be backed up by something. Commonly, this is the value of a fiat currency such as the euro or the dollar. However, in theory, it could be backed up by the value of some other asset, like gold or property.

The reason that this is relevant is that stablecoins can be a fascinating use case for those wanting to get into crypto without the risk of losing a large amount of their money. Stablecoins have the security and decentralized benefits of different cryptocurrencies without being changeable and concerning over time. This makes them much more accessible for those who don’t have the financial moxie that a practiced trader may have.

Stablecoins are also a fascinating idea as part of a general crypto portfolio. While having all of your crypto wealth tied up in a stablecoin might not be the best idea for most people, it can form a good base for a general portfolio. For instance, you may have fifty percent of your portfolio in stablecoin to ensure that, even in a downturn in the market when your holdings in Bitcoin and Ethereum decrease in value slightly, your overarching wealth remains stable and steady. With time and practice management, this stability can be ideal for growing generational wealth.

Bitcoin is likely to become more popular with time because of the features laid out in this article, and with its popularity, it’s likely to increase in value as well. Keep watch of the crypto market over the coming years: whatever happens, it will surely be fascinating!