At time of writing, bitcoin attracts more attention from web searchers than everyday staples like “food,” “water,” and “coffee.” Given the rapid, seemingly uncontrolled growth in bitcoin prices as of late, we’d be remiss not to mention that bitcoin eclipsed “cancer” in worldwide search interest sometime in November 2017.
Although the total value of the cryptocurrency market crept steadily higher throughout 2017 – and then suddenly all at once in the last quarter – investors and observers shouldn’t expect growth to continue like this without some sort of correction.
2018 will likely be a rocky year for crypto markets, so to relieve some of that dread, here are some lighthearted predictions.
2018: Blockchain Soldiers On
Just like how a new cryptographic block file gets added to a chain at regular intervals, come hell or high volatility, so too will experiments with this emerging technology throughout next year.
The more “unique” aspects of cryptocurrency culture will drive a bigger wedge between its more colorful communities from the mainstream.
Some may view this as an advantage. After all, the original bitcoin white paper was a political document, one that lays out a technical and intellectual framework for a currency that supposedly releases the control of economic value from the coils of central banks and other third-party intermediaries.
However, radicals rarely usurp incumbents directly. But a radical idea – if sufficiently compelling – can be adopted or co-opted by incumbents. I expect maintained interest in blockchain technologies from mainstream organizations to continue despite the cultures around specific cryptocurrencies.
Here’s what to look out for in 2018:
- Expect to see more countries’ central banks experiment with blockchain implementations of national currencies or internal ledger systems.
- Expect collaborations between traditional financial institutions to develop shared blockchain infrastructure to start bearing fruit.
- Die-hard believers in open, unregulated blockchain systems (like Bitcoin, Litecoin, and many others) will be very dismissive of these efforts. Such dismissiveness will likely be ineffective at slowing the pace of institutional adoption of blockchain technology.
2018: Crypto Finds Hierarchy
Divisions over software design and implementation are to be expected, to a degree, in any open source software project. But those disagreements rarely result in billions of dollars worth of economic fallout as they can in the crypto world.
At least in the bitcoin ecosystem, a certain tribalism has emerged.
Most recently, an ongoing disagreement over how to make bitcoin more scalable resulted in a literal split in the community. Bitcoin Cash “forked” off of the main bitcoin blockchain on August 1, 2017. Its main feature is a larger block size, which its creators argue would increase transaction throughput on the network. Bitcoin Cash was listed on CoinBase, one of the most popular bitcoin exchanges and online wallets in the US, in late December 2017. This caused the price of Bitcoin Cash to jump and the price of bitcoin to fall, leading to a slew of accusations ranging from “shilling” (another bit of blockchain jargon) by Bitcoin Cash boosters like Roger Ver to insider trading at Coinbase, and more.
Contrast the infighting in bitcoin with relative peace in Litecoin (an open source cryptocurrency on an open blockchain), Ripple (also open source, but on a blockchain maintained privately by a private company of the same name), or Ethereum. These cryptos either have strong technical leadership, a shorter and less contentious history of forks, large endowments (either from ICOs, like Ethereum, or from VCs, in Ripple’s case), or some combination thereof to help maintain internal cohesion.
Given that and more, here’s what 2018 might hold:
- No, people won’t “just stop fighting and get along.”
- Expect to see “closed” cryptocurrency systems gain more traction as community involvement in open implementations will become more fractured and contentious, without intervention
- In open-source cryptocurrency projects, expect the “management structure” to become more top-down and hierarchical as strong, authoritative leadership will be increasingly seen as a necessity. These leaders won’t be CEOs per se, but more like “benevolent dictators for life” (BDFLs) who serve as “the last word” when adjudicating intra-community disagreements over technical decisions
- Expect communities of developers, investors, and enthusiasts in open cryptocurrency systems to split if there isn’t already a credible individual (or small group) that currently serves the BDFL role.
Be Boring Again
While crypto kiddies are busy playing with their Crypto Kitties, and one branch of an open-source tree publicly smears another in a battle for ownership of the trunk, development of blockchain technology solutions and further research into blockchain implementation will quietly hum along in the background.
Whether any of this will bear any fruit is largely unknown at this point. For all of those folks who’ve said “it’s about the blockchain as a filesystem, not as a payments system,” let’s hope it does. Because then we could stop talking about it so much, just like we don’t have heated debates and breathless news coverage about the protocols that run, say, email.
We should all strive to make blockchain boring again. But that’s probably not going to happen next year.
iStockPhoto / silverkblack
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