Cryptocurrency has continued to make headlines this year thanks to highly volatile prices and moves from big corporations to enter the space.
But if you’re new to crypto, you might still be wondering: where exactly is crypto headed? Is this all a lot of hype that will soon die down, or could cryptocurrencies change the way we do things online in the long term?
We spoke with Rossen Yordanov, Skrill’s SVP Consumers and crypto expert, to find out.
Q. How do you expect crypto to evolve over the next year?
I expect the adoption of cryptocurrencies and blockchain technology will continue to increase. Here are five good reasons why:
1. What the key indicators are saying
The number of Bitcoin addresses (a common indicator for adoption) are shooting up. The same goes for transactions on some of the major networks, like Ethereum.
2. Buy-in from big corporations
On top of that, you have companies putting parts of their balance sheet into Bitcoin (Square, Tesla, Microstrategy to name a few).
While big banks are introducing products to give their clients exposure to cryptocurrencies. JP Morgan, for instance, are even going to have an actively managed Bitcoin fund.
Interesting fact: JP Morgan’s CEO, Jamie Dimon, famously threatened to fire employees who traded bitcoin in 2017. Their about-turn on crypto goes to show how far things have changed.
3. The approval of exchange-traded funds
That’s not all. There are several Bitcoin and Ethereum exchange-traded funds (ETFs) live in Canada and up for review in the US. ETFs can increase the volume of cryptocurrency being traded by allowing investors to bypass a crypto exchange and use a traditional market exchange instead.
The influential figure and “ETF Godfather” Reggie Browne recently advocated for the approval of cryptocurrencies. He announced “It’s time (for cryptocurrencies)” – a strong statement considering that in 2018 he said a bitcoin ETF wouldn’t be approved any time soon.
4. The rise of decentralized finance (DeFi)
There are now more finance apps based on blockchain technology – commonly known as DeFi.
Thanks to DeFi, people can take out loans or earn interest on their money (yes, real interest upwards of 5%) without a central authority/intermediary.
There have also been instances of people buying digital art via non fungible tokens (NFTs). The tokens allow intellectual property (in this case, the artwork) to be made publicly verifiable and authenticated on a blockchain.
One notable piece sold for $69 million. If the seller of the art had kept his money in the Ethereum he received at the time of the transaction, it would be worth even more now.
5. Social media trends and crypto
We’ve all seen the DOGE coin memes being shared online and how Elon Musk has joked about it on Twitter.
These kinds of social trends build awareness of cryptocurrencies within mainstream audiences.
My 63-year-old father even sent me a message saying that my mother wanted to buy Dogecoin and that he was finding it hard to stop her. He was only joking, but my point is he knew enough to make fun of it.
And for a good example of how NFTs have featured in pop culture, check out this sketch from Saturday Night Live – they did a hilarious video on NFTs.
Q. What do you think of recent changes in cryptocurrency prices?
Recently Ethereum has done amazingly well, while Bitcoin cooled off.
Funnily enough, the exact bottom in the price of ETH vs BTC was when a group of so-called “Bitcoin maximalists” – people who want only Bitcoin to exist – had a “Death of Ethereum party” on clubhouse.
Although I personally don’t see ETH and BTC as competitors (I love both), it was amazing to see how after that “party” the price of Ethereum went up massively.
Q. Why buy cryptocurrency with Skrill?
Skrill is an extremely straightforward way to get into crypto – simply download the app, add some money, and choose a cryptocurrency to buy.
Compared to a crypto exchange, the user experience is slick and easy. While compared to other digital wallets offering crypto, Skrill has more features to help you buy in a smart way.
For example, you can set an automatic order for the price you want to buy or sell for – something most other wallets don’t have.
So – in a way – it’s the best of both worlds: a smooth experience with options that help you decide how and when to buy.
Cryptocurrencies are complex products with high price volatility. They are unregulated, without consumer or financial protections. Only risk what you can afford to lose.