Business 12 February 2019Steve Kaaru
Fundstrat Research: Last year’s challenges will be tailwinds in 2019
The year 2019 was one of the worst ever for the cryptocurrency industry. Most cryptos lost 80 percent of their value in a very brutal bear market. However, 2019 will be a much better year according to Fundstrat’s research. The research and market strategy firm released its 2019 crypto forecast report recently, and it’s one that predicts a turn of fortunes for the embattled industry.
According to the firm’s head of research Tom Lee, the crypto market will see “9 incremental improvements in the landscape that ultimately support higher prices.” Lee pointed out the nine areas that expect a turn of fortunes includes the USD trend. In 2018, cryptos lost ground to the US dollar, but this will change in 2019, mainly because the dollar is expected to weaken in 2018.
Yet another area that expects an increase is the fiat to crypto on-ramps. An increase in the popularity of over-the-counter platforms is one factor behind this. Binance also recently announced that it would facilitate credit cards which will contribute to this as well.
The risk of unfriendly regulation is also expected to become less in 2019 compared to last year. The SEC has been one of the main forces behind regulation in the industry. However, with crypto firms adopting more self-regulation, the SEC’s influence will gradually decrease.
The report also attributed the positive outlook to an expected increase in institutional investment. This trend has continued improving year-on-year despite market volatility. The biggest reason many institutions have kept away is the risks posed by market manipulation. However, with platforms such as Bakkt expected to launch this year, the market will attract more institutional investors.
Lee further expressed his belief in 2019 becoming better in an interview on CNBC. The former Wall Street veteran believes the tide is turning for crypto and the challenges are becoming opportunities.
“Of the ten things that really became headwinds last year, seven of them are becoming tailwinds. One of them is that there is more visibility on ETF approval. We actually had an SEC commissioner talk about it today. These things are positive for crypto.”
He declined to make any crypto predictions for 2019, one of the things he is most renowned for. Last year, his prediction that Bitcoin Core (BTC) would hit $25,000 went horribly wrong.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
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