The blockchain sector is among the fastest-moving industries and therefore is also massively susceptible to change and disruption. For example, in three years, the sector has grown from $1.2 Billion to $3 Billion between 2018 and 2020. Estimates for next year show that the market could grow to a value of $7 Billion. This shows just how rapidly the market is moving as a whole.
It can be difficult to pin down a lot of the ways in which blockchain technology and the market as a whole is going to change; thankfully, we’ve researched fifteen upcoming blockchain events for you to be aware of in 2021.
1. Companies Are Going to Increasingly Make Use of Crypto
PayPal caused a massive stir in October 2020 when the payment giant announced that it would be facilitating the purchase and sale of cryptocurrencies, including Bitcoin on its platform. Furthermore, the service would also allow users to pay for things with their cryptos by converting the amount required for purchases into the native fiat currency. This means the merchant doesn’t have to hold the cryptos, they just get the traditional money.
This move by PayPal caused the price of Bitcoin to noticeably increase at the start of a rally which saw the flagship cryptocurrency hit an all-time high on the 30th of November, before shortly falling back under that mark.
Aside from PayPal, many other companies have started using cryptocurrencies, including JP Morgan Chase and IBM, however, PayPal has taken the largest step forward by beginning to allow its user base of over 346 Million people to access cryptocurrencies. This move and the increased value of Bitcoin should set a precedent and an increased willingness by other businesses to use crypto.
2. DeFi is Going to Continue Its Growth
This year, Decentralized Finance (DeFi) has drastically risen to prominence, with many proponents of the concept believing it is something that can “beat the banks”. Even if this technology doesn’t live up to that level of hype, the technical and user benefits are worth considering. Typically speaking, DeFi itself is a form of finance that doesn’t need middlemen such as banks or exchanges and agreements are enforced through smart contracts.
The popularity of DeFi has been driven up for its use cases, which include improving the playing field between lenders and lendees by democratizing the lending process. For example, with DeFi lending there will be no need for credit checks, which means more people will be able to get finance and lenders will be able to earn higher returns due to transparent dealings and the absence of a third-party being involved.
Furthermore, DeFi has given rise to decentralized exchanges such as Uniswap, which are trustless platforms that allow users to trade assets without needing a third party due to them operating on a shared ledger. These exchanges do not need central management and there is no single point of failure.
DeFi was growing at a rate of half a billion dollars per week in August 2020, which is a testament to the growth potential of the concept and it will not be a surprise to see the continuing growth of DeFi in 2021.
3. “Crypto Casinos” are Going to Become More Prominent
The rise of so-called “Crypto Casinos” has appeared in recent times, due to the fact that casinos benefit immensely from offering cryptocurrency services ie. payment and payout in cryptos. This is because it opens the casinos up to a whole new host of potential users, who will be more likely to play their games and use their services.
Furthermore, the implementation of cryptocurrencies in online casino platforms will have benefits for the users, as the increased security of crypto wallets ensures that all transactions are safe and transactions that would normally take days to process can be done in less than 15-minutes.
One reason for the decline in the popularity of online casinos is that current payment methods are not good enough for the customers. Cryptocurrencies can help to change this, meaning that casinos will be likely to increase their drive on cryptocurrencies in 2021.
4. Bitcoin is Likely to Continue Its Ascent
As previously mentioned in this article, Bitcoin has very recently hit a record-breaking price, causing a media frenzy. The increased adoption of cryptocurrencies and Bitcoin in particular by businesses is likely to increase the value of the cryptocurrency even further in the coming year.
It recently came to light that an analyst at Citibank believed that Bitcoin would go on another rally during 2021, reaching $318,000 per coin in December of the year. This number seems unlikely, however even more conservative estimates place the growth of Bitcoin in 2021 to reach $100,000 using the Stock-to-Flow forecast model.
Even if none of these predictions come true, it is looking incredibly likely that Bitcoin will continue to increase in price during 2021.
5. Crypto’s Use as a Payment Method To Increase
We have previously discussed how PayPal has paved the way for payment providers to allow their customers to buy and sell cryptocurrencies themselves and also allowing those same customers to pay for things with those cryptocurrencies. More payment businesses are likely to follow suit in the future, but this isn’t the only way in which crypto is going to gain more ground as a payment method.
(Medium)
Cryptocurrency ATMs, which allow people to withdraw cash using their cryptocurrencies and also allow for deposits in cryptocurrencies have begun popping up everywhere in great numbers. For example, in 2019 there were 4,213 cryptocurrency ATMs in the United States and this number has now eclipsed 9,000 in 2020.
The increase in uptake of cryptocurrency ATMs does not look like it is going to slow down in 2021. Combining this with new infrastructure from online payment providers will allow for cryptocurrencies to become much more widely adopted as a payment method.
6. Bitcoin’s Systems Could Get an Upgrade Soon
Earlier this year, it was announced that the Bitcoin blockchain would eventually be undergoing an update using the Taproot/Schnorr code. Initially, it was hoped that this upgrade would appear in 2020, however, it appears much more likely that the upgrade will be completed in 2021. The upgrade to the code itself is hailed as a way to improve privacy, make it so that the tech can scale more, and to facilitate the increased use of smart contracts.
The Bitcoin blockchain itself is open-source, meaning that anyone can develop and view proposed changes to the blockchain. The new code itself was merged into the Bitcoin Core library in October, however, it still remains unclear about how much time will pass before the actual upgrade gets off the ground and provides benefits for the Bitcoin blockchain and its users.
The development of more flexible and effective smart contracts, coupled with increased scalability and privacy will prove to be a great boon for the cryptocurrency and you should definitely keep your eye on the progress of the upgrade over the course of the next year to make sure that you don’t miss out.
7. Public Trust in Blockchain Will Continue To Grow
It’s safe to say that when cryptocurrencies and blockchain technology first properly entered the public sphere, many people were skeptical and untrusting of the new technology. This is due in part to opportunistic ICO scammers and other scammers that sought to exploit people’s interest in blockchain and cryptos. Thankfully, people have become savvier to crypto scams and fewer people are losing money.
In 2017, in the wake of the cryptocurrency boom that year as previously discussed, many people saw cryptocurrency as a bubble and a passing fad that wouldn’t last for more than a few years. Now, however, 55% of business owners believe that blockchain technology will be critical to their organization in the next two years and individuals are becoming more trusting in the future of cryptocurrencies, especially millennials, with 60% of them being familiar with cryptocurrencies.
It’s very likely that during 2021, public trust in blockchain and cryptocurrencies will further increase and bring more people into the market. This increase in trust should also help to facilitate further market growth, which is great for everyone involved.
8. Blockchain Will Be Further Recognised Aside From Cryptos
When it comes to the applications for blockchain technology, unsurprisingly, the one thing that most people think about is cryptocurrencies. That’s why it may come as a shock to some people that the organizational applications for the technology are much wider-ranging and it is likely that as more businesses and other organizations take advantage of blockchain technology, more people will become aware of its inherent benefits.
(Finextra)
For example, blockchain technology has great potential use in accounting and auditing as records cannot be edited once they are created, which greatly decreases the likelihood of fraud and the secure nature of the technology means that human error will not be a factor. Furthermore, the blockchain ledger means that it can be effectively used to track the movement and location of items that move throughout supply chains, making them more effective.
Over the course of 2021, more applications for blockchain technology will appear and be adopted and existing ones will have more attention drawn to them. This means that people will be less likely to be of the opinion that blockchain starts and ends with cryptocurrencies and that it isn’t useful for anything else.
9. Stablecoins Will Come Back Into The Limelight
Stablecoins have been around the block now in the cryptocurrency sector, providing an alternative to other cryptocurrencies that are less volatile and as a result, has a lower potential for crashing. Stablecoins have been a commonly suggested solution to the problem of expensive remittance and other fees for transferring money across countries, as well as the amount of time that these money transfers will take.
A big fish currently in the news is that Facebook’s own upcoming cryptocurrency, Libra, is being planned for launch in January 2021 in the form of a stablecoin pegged to the US Dollar. This move exposes Facebook’s massive 2.7 Billion-strong user base to stablecoins and will potentially draw a lot of these people into the blockchain market and to stablecoins in general.
The media hype surrounding stablecoins may have slowed down in recent times, however, the potential for the altcoins in 2021 and the media potential surrounding the launch of Libra with Facebook should be enough to catapult them back into mainstream discussion.
10. Planning For Central Bank Digital Currencies Will Accelerate
Central Bank Digital Currencies (CBDCs) are a type of asset that uses blockchain technology to create a digital token that is pegged to the value of the national currency, or regional currency in the case of the Euro. These currencies have been proposed in organizations such as the Bank of England, Russia, China, and more recently with joint trials in Saudi Arabia and the UAE.
As it currently stands, there are few countries in the world that have actually created their own cryptocurrencies, and these include China, Singapore, Senegal, and Tunisia. These currencies have been proposed for a number of reasons, including the increased speed available to digital currency transfers and the decreased costs of cross-border money exchanges.
Countries are not going to want to miss the boat on CBDCs and as such, you should expect to see a great deal of news and development relating to the adoption of CBDCs across the globe in 2021.
11. Methods to Prevent Rugpull Scams Will Become More Commonplace
Quite possibly the biggest problem that has been plaguing the DeFi market is the presence of rugpull scams on platforms like Uniswap. In these types of scams, the scammer will mint new tokens for a project and some of these tokens will be offered or airdropped to increase interest in the project and gain more investment and liquidity as the token value increases. Then, the scammer will pull the liquidity from the exchange platform, essentially taking the money and running away.
(Cityam)
Thankfully, there are businesses working on ways of preventing rugpull scams from happening, one of these businesses is Locked Liquidity (LID) Protocol. They enforce the locking liquidity on exchanges through advanced smart contracts that release over time, or after a certain threshold is reached. This prevents scammers from pulling the rug on investors and helps people to keep their money safe.
As we go through the next year, it is likely that we will see more methods of preventing rugpull scams from derailing the rapid growth and progress that has been made by DeFi projects on decentralized exchanges such as Uniswap.
12. Crypto Regulation is Going To Take Significant Steps
Regulation for cryptocurrencies and other forms of tokens have always been behind the curve, this is mainly due to the slow legislative process found in many countries, coupled with the rapid advancement of technology and funding methods within the sector. Lawmakers had previously likened the crypto market to the “Wild West” in a regulatory sense and it doesn’t seem like it will be long until regulation becomes fitter for purpose.
The European Union plans to have their comprehensive cryptocurrency legislation put into law by 2024 and the United States is rumored to be mulling new regulations over cryptocurrency wallets that lower the AML threshold from $3,000 to a measly $250. This is for transactions going outside of the United States or into the US from another country.
Even in Russia, the government has proposed that cryptocurrency wallets transacting more than 600,000 Rubles per year will have to report transactions and balance information to tax authorities and there are harsh penalties being considered for offenders of the new laws. This shows that in 2021, it is likely that crypto regulation is going to take big steps, either to the benefit or the detriment of the sector.
13. The Number of Registered Crypto Wallets Will Skyrocket
Crypto Wallets are a fundamental aspect of the blockchain and cryptocurrency ecosystem, allowing users to store and transfer their cryptocurrencies seamlessly, and safely in most circumstances. The number of registered cryptocurrency wallets has naturally increased in line with the popularity of cryptocurrencies and trust in the asset class. As of the end of October 2020, it was estimated that there are over 55 Million blockchain wallets in circulation.
By contrast, in 2016 before the cryptocurrency boom, there were only an estimated 11 Million cryptocurrency wallets in circulation. As we have highlighted in this article, the blockchain market and cryptocurrencies as a whole are going to experience more growth in 2021 and this will directly coincide with an increase in the number of people creating new cryptocurrency wallets to store their cryptos.
14. Expect More Blockchain Developments to Come out of China
China seems to be at the forefront of crypto and blockchain developments at the time of writing, their trials with CBDCs, and the fact that the national government has encouraged itself and corporations in the Asian country to begin experimenting with blockchain show that we may see more coming out of China soon. This almost seems like an oxymoron, considering the country’s previous ban on ICOs and cryptocurrency sales, however, these bans do not mean that China is cryptophobic.
China’s Communist Party has included the presence of blockchain technology and its development as a part of the country’s most recent 5-year plan and Hangzhou, a city in the eastern tip of the country has previously committed $1.6 Billion to the development of a Blockchain Industrial Park and to the development of blockchain-focused firms in the city in collaboration with the Communist Party.
With news of the government pushing blockchain technology itself on a state and local level, as well as the overwhelming economic and research power at its disposal, it is very likely that we will hear of new developments in China in 2021.
15. The Value of Many Altcoins Will Increase
Similar to the impact that PayPal has had on the price of Bitcoin, the value of altcoins are also likely to increase during the next year too. This will be due to a combination of factors, including the increased trust that the average person has in cryptocurrencies, as well as the upcoming increased adoption and use of cryptos by businesses in the coming year. Bitcoin isn’t the only cryptocurrency that is going to benefit from this.
For example, Litecoin is currently trading at around $90 USD at the time of writing and expert analysis has shown that the price of this altcoin is expected to balloon in 2021, reaching up to $600 in value. This represents a massive increase over the course of twelve months and it is likely that a lot of other altcoins are also going to benefit from the accelerated growth of the blockchain and cryptocurrency markets.
Cover Photo by Launchpresso on Unsplash
*I write about Blockchain, Startups and Marketing.
In 2017 I Co-Founded Guerrilla Buzz, an innovative PR, growth and marketing agency for blockchain startups. You can find me here and also on Twitter, Linkedin and Telegram
In 2017 I Co-Founded Guerrilla Buzz, an innovative PR, growth and marketing agency for blockchain startups. You can find me here and also on Twitter, Linkedin and Telegram
**Here are some other interesting articles that I wrote:
Hacking Your Marketing Campaigns With Data Science
Blockchain PR Guide 2021
The Rise Of Zero-Trust Architecture
Hacking Your Marketing Campaigns With Data Science
Blockchain PR Guide 2021
The Rise Of Zero-Trust Architecture