As the crypto asset class matures into its second decade, we’ll likely see a distinction in the terminology between the thousands of coins competing to be “digital currencies” and “digital securities”, which people spend and trade using various apps, vs. Bitcoin, which is far and away the strongest “digital asset” or “digital property.” Bitcoin’s limited supply makes it desirable for people own and hold, as an improvement upon gold and as something like a Manhattan land REIT that is increasingly valuable but is traded infrequently and doesn’t pay dividends. It’s a new asset class, with unique properties that defy perfect analogy with traditional asset classes.
In summary, my bet is that we’ll see in the next decade:
1) The vast majority of the sh*t coins wink out after a lot of bad press and resulting regulation;
2) The remaining few useful networks, (Ether, Cardano, and Solana, apparently at present) compete to produce useful spending apps for consumers. Some will be more like currencies and some will be more like securities.
3) Another tranche of stable coins with government backing will settle out. Tether is one controversial early mover;
4) NFTs, DAOs and other blockchain-based experiments happen with varied success;
5). Bitcoin, uniquely, first exceeds gold’s market cap and then expands further in utility or various types of buy-and-hold investors. There will be apps built on top of it too to improve its velocity but that is not a requirement for long term holders like me, who are fine with it being as inert as possible in cold storage wallets.
That’s my dissection of the fascinating, present blockchain space. No one has to agree with me, my prediction can certainly be proven incorrect, and I don’t care whether others decide to participate or not. I’m also comfortable that some people are hostile to crypto, understanding that disruptive technologies are always quite threatening. But that is my own look at the next 5-10 years that my growing personal research into this space so far is pointing toward. YMMV.
