by Raymond Hsu
The rapid development of blockchain technologies and the acceleration of the adoption of cryptocurrencies is one of the most exciting technology trends in our lifetimes. A blockchain is a digital distributed, decentralised, public ledger and the technology has the potential to solve many real-world problems online.
A lot of people are aware that blockchain technology underpins Bitcoin and other cryptocurrencies. But its potential is much broader – digital smart contracts can transform not only the finance sector, but also areas in insurance, supply chains, logistics and much more.
2021 has been one of the most instrumental and eventful years in the blockchain and cryptocurrency industry. The US government said it doesn’t have any plans to ban Bitcoin and crypto. US regulators have also discussed how to fairly regulate stablecoins and have approved a Bitcoin futures ETF. And, most importantly, El Salvador became the first country to make Bitcoin a legal tender .
2021 is just a preview of what we are going to see in 2022. Thanks to all the groundwork laid this year, I see five major trends that will play out next year that will further accelerate the adoption of cryptocurrencies in ways that we have never seen before. More countries will integrate crypto into financial systems
In September 2021, El Salvador became the first country to adopt Bitcoin as legal tender. Based on what I am seeing across the world, it is highly likely that we will see more countries regulating crypto and incorporating it into their financial system.
Next year, we are likely to see the Eurozone roll out its own crypto regulations called the Markets in Crypto-Assets ( MiCA ) framework which defines digital assets as “digital representations of value or rights which may be transferred and stored electronically, using distributed ledger technology or similar technology”. Other jurisdictions across the planet will follow and likely regulate crypto in a similar fashion.
When more countries begin regulating crypto, it will create a domino effect that will compel other governments to also begin to explore how they can embed the emerging industry into their own financial system and economy.
Industry experts believe in general that crypto will become a norm in our lives. In one recent survey , 54% of a panel of crypto experts thinks ‘hyperbitcoinisation’ — the moment that bitcoin replaces fiat currency and overtakes global finance — will happen by 2050. Traditional finance to play a larger role in crypto
2021 has seen a plethora of traditional institutional investors step in the crypto space in some meaningful way. In March, Morgan Stanley became the first large US bank to offer its wealth management clients access to Bitcoin funds.
Even the world’s largest asset manager – BlackRock – took its first steps into crypto exposure in two funds early in the year.
This is just the beginning of traditional financial institutions investing in the crypto space as they continue to research and learn more about the industry.
In 2022, we will see even more financial institutions stepping in, […]