September 30, 2020

A look at the future of the blockchain industry

The most interesting days for the blockchain are yet to come. However, anyone who wants a clear idea of his future, you must first understand that the industryThe blockchain is not monolithic, and therefore, the forecast should be approached from several sides. At the very least, you need to consider the behavior of the crypto market, technology adoption, development, and scalability.

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Cryptocurrency Behavior

The focus here is on cryptocurrency prices, volatility and market capitalization.

The blockchain industry is associated with an asset class,interesting to both long-term investors - the so-called scammers - and day-traders. This asset class includes cryptocurrencies, tokens, and tokenized real assets.

Prices in the crypto space are differentvolatility, but the overall long-term trend is upward. The trajectory “to the Moon” was mainly determined by the fact that most crypto assets are deflationary, and with the spread of awareness, demand is growing, which, in turn, is pushing prices up.

Many people believe that in the near future this trendwill not stop. And despite the lack of price increases for many crypto assets last year, the generally accepted opinion, especially among enthusiasts, is that the historical maximums of prices and market capitalizations are still ahead.

Some made very bold predictions. For example, venture capitalist and business angel Tim Draper officially announced that he believes that Bitcoin's price could reach $ 250,000 by 2022.

Because Bitcoin and other crypto assets havea high positive correlation, if forecasts come true, price increases in the next decade will be a phenomenon of the entire industry. It also means that the industry will see an increase in market capitalization.

However, caution should be exercised regarding the future behavior of cryptocurrency prices. It is difficult to predict it.

Decentralized applications will become the norm

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Although the first blockchain application that attractedthe interest of many, there were cryptocurrencies and tokens, apparently, the focus is shifting to other capabilities of the technology. One application that demonstrates great potential is smart contracts, agreements embodied in the code and capable of independently executed in the blockchain.

A lot of attention is also focused onusing the blockchain as a basis on which not only all kinds of applications will be executed, but also the data of these applications is safely stored. In this regard, the blockchain offers a number of advantages over centralized servers. These include improved security, privacy, and reliable uptime.

Today, almost every industry hasstartups developing breakthrough applications that will run on the blockchain. There is also interest from large technology companies and public institutions around the world.

In particular, their involvement occurs through consortial protocols such as R3 and Hyperledger. They also do independent research and invest in blockchain projects.

A significant part of what is happening around the blockchainstill in development. Full results can be seen in the coming years. And everything indicates a more active participation of various stakeholders in the development of new solutions based on the blockchain.

Scalability and interoperability

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The third aspect of the blockchain industry, which is requiredchange in the coming years, is associated with the scalability of blockchains. It turns out that you can increase throughput by creating completely new blockchains, or by improving existing scalability solutions like Segregated Witness and chain solutions like the Lightning Network.

However, soon we can also increasinglyobserve the trend towards creating interoperability solutions. As more and more blockchains appear, we can see how the industry will go through what the Internet has gone through in its development before becoming the way we know it today.

In the early days of the internet, most networks werelocal (LAN). Initially, they did not interact with each other, as they were created on the basis of different technologies and protocols, performed different functions, and, most importantly, then there were no generally accepted industry standards.

The situation has changed with the advent of the protocol stackTCP / IP, allowing all networks to integrate and interoperate. Anyone who wanted to create a new system could do this, knowing how it would interact with existing ones.

We are at a stage when the blockchain industrymoving towards the development of standard protocols that will ensure that anyone can create a public or private blockchain that can interact and exchange data with those that already exist.

And just like the TCP / IP protocols simplifiedthe passage of data around the world in seconds without the need for intermediaries, the cost will also be able to move around the world regardless of the blockchains involved.

We already see projects working in the direction ofthe interconnectedness of blockchains. These include the Lightning Network, Celer Network, and the Interledger project. One way or another, we can say that a bright future awaits the blockchain industry.

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