Through most of 2018, particularly into the second half of the year that saw coin prices fall more than 80 percent across the market, the investment base for cryptocurrency came to hang upon news by the United States Securities Exchange Commission (SEC) over approval for a BTC ETF.
While exchange-traded funds represent another form of investment vehicle for the digital assets, which can already be traded freely on the numerous cryptocurrency exchanges, they signal greater regulation and trust for the industry–two features that most larger institutions and banks are waiting upon before entering the market.
As Bitcoin edges closer to breaking the critical $4000 mark, with most of the top coins experiencing positive price movement over the last week, the cryptocurrency market is off to a strong start for 2019.
While prices did experience some volatility through the end of January, they have mostly traded sideways for the last several weeks. However, the development of several major news announcements, including growing excitement over a possible Bitcoin Exchange-Traded Fund (ETF) being approved, has led to renewed interest for the industry and its investment base.
With the SEC looking more likely to approve a BTC ETF by the end of 2019, investors finally have positive news to hang upon in light of the ongoing bear market. Token prices have responded to the development over the last week, with an encouraging albeit stable increase in valuation reflecting a more mature market landscape.
As analysts have pointed out since the bullish run to end 2017, the exponential jump in cryptocurrency valuation at the beginning of last year was largely constructed on FOMO and speculation, creating market conditions that were bloated and resting delicately on a house of cards.
With adoption becoming the focus for cryptocurrency, blockchain and its advocates throughout 2019, the coin enthusiasts are finding more assurance in the projects they support. Small developments such as the TRON Foundation partnering with the ALS Association to track donations via blockchain are signaling a broadening acceptance for the technology of cryptocurrency and the bleed over effect occurring with mainstream audiences.
A recent report found that stablecoins, of all things, are likely to drive adoption and bridge the gap between cryptocurrency and Main Street over the next two years. While it may seem surprising that a price stable coin, as opposed to one of the more malleable digital assets such as Bitcoin, is going to have such an impact, major market players have already given indication of the former.
JPMorgan Chase, one of the more outspoken groups against Bitcoin and cryptocurrency over the last several years, announced the creation of the JPMCoin–a stablecoin that will improve client cross border transactions. Social media giant Facebook has likewise been tied to a stablecoin project for its messaging service WhatsApp, which would constitute the largest step in adoption the industry has thus far seen.
Investor wallets may still be reeling from the severe drop in coin valuation that took place following January 2018, but the start of 2019 has at least brought a glimmer of hope. While it’s too early to say whether cryptocurrency will see a return to bullish conditions, the groundwork for adoption and genuine industry growth, as opposed to the more empty speculation, is clearly being demonstrated in the first two months of the year.
