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Will Bitcoin Remain a Dominant Cryptocurrency?

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Bitcoin Remain dominant

A Forecast for the Next Decade of Crypto

Cryptocurrency is young. Thursday — October 31, 2018 — will mark its first anniversary, 10 years since Satoshi Nakamoto’s fateful email. It wasn’t until January 2009 that the first Bitcoin block had been mined, and March 2010 that Bitcoin was first assigned a monetary value. Simple math shows that the anniversaries of those dates are still in the future.

Yet it’s time to think about what this future will be like. Bitcoin has dominated the whole industry since its birth, dictating the trends on the market. However, now Ripple, Bitcoin Cash, and Ethereum are challenging the king. It’s too early to say, but we might be heading towards a more competitive cryptocurrency market.

In this article we will:

  • Explain why Bitcoin was a dominant force on the market;
  • Review the significant alternative cryptocurrencies and their impact;
  • Predict the next 10 years of crypto, based on the current data.

Why Bitcoin Holds The Market Hostage

Satoshi Nakamoto was not the first to propose the idea of a privacy-focused value transaction system. He was standing on the shoulders of David Chaum, Douglas Jackson and Barry Dowey, Adam Back, as well as many other cypherpunk idealists.

And yet, the general public remembers only Nakamoto and Bitcoin. The absolute majority of the newcomers to crypto purchases Bitcoin and ignores the other currencies. This only increases the importance and influence of Bitcoin and leads more investors towards it.

According to CoinMarketCap, right now Bitcoin is claiming mind-boggling 52% of the total market capitalisation. Ethereum, which led to an ICO craze of late 2017, has less than 10%. Ripple has less than 9%. And it’s not a good thing. Compare these three charts:

Bitcoin Chart

A Bitcoin capitalisation-over-time chart. Note the shape of the graph starting from 2017.

Market Cap

A cryptocurrency market capitalisation-over-time chart. Note the similar shape of the graph.

Market Cap Chart

A capitalisation-over-time chart with Bitcoin removed. The shape of the graph is exactly the same.

The first two charts should be similar — after all, Bitcoin dominates the market. However, the last chart proves that Bitcoin has a significant influence on the value of the other currencies too. This situation is not healthy for the economy and makes the altcoins hostages to the Bitcoin.

Imagine if Apple had that much clout on the stock market. Imagine that everyone’s stock would rise and fall in value according to Apple’s decisions, news, and press releases. This situation would crush the businesses worldwide — but it will never happen. Apple’s leadership is constantly challenged by other companies like Amazon, Microsoft, and Alphabet. In fact, Amazon might take over the next quarter, if the reports are accurate.

And yet, nothing even remotely similar ever happened on the cryptocurrency market. Which begs a question — will the next 10 years of cryptocurrency be equally dominated by Bitcoin?

What Can Challenge Bitcoin?

Bitcoin has 2070 competitors. However, even combined, they do not represent a proper competition. Take a look at the combined capitalisation-over-time chart:

Market Cap

However, the situation is slowly getting better. While back in 2013 Bitcoin controlled almost 90% of the market, it is “only” 52% right now. Moreover, some of the currencies begin to ignore the trends set by Bitcoin, becoming more and more independent. Let’s review three of those currencies in more detail.

Ethereum (ETH)

Ethereum, released in 2015, was the first altcoin to register in the public mind. Just like Bitcoin, it wasn’t the first overall — LiteCoin has been around since 2011. However, Ethereum offered something unique — smart contracts for everyone with minimal effort.

What followed was an ICO craze that propelled Ethereum far beyond the initial expectations. You can see the exact moment this happened on the chart above. It’s marked as Jul ‘17 and represents the only moment when Bitcoin’s dominance was threatened.

Unfortunately for the ETH holders, the ICO bubble burst in late 2017. Right now Ethereum is barely trucking on, continually losing the market volume and capitalisation. However, Vitalik Buterin, the founder of the Ether project, thinks that a comeback is more than possible.

Ripple (XRP)

Ripple is not a cryptocurrency in the narrow sense of the word. It is centralized and not really that transparent. However, it is still a private and a secure digital payment network that is based on a blockchain, so most cryptocurrency enthusiasts let it slide. Mainly since it now controls almost 9% of the market capitalization.

The best feature of Ripple is its ease of use. Due to a highly efficient system, Ripple allows for fast transactions with a standard fee of 0.00001 XRP. As a reference, Bitcoin’s standard fee on October 29 was 1356 Satoshi or 0.19050295 XRP.

Such accessibility led to the creation of multiple gateways — official or semi-official exchange points between Ripple and other currencies, both fiat and crypto. Right now, Ripple is not only a transaction network, but also a favourite medium for transactions made in different currencies.

XRP took a couple of hits along the way due to controversial management decisions and the lack of trust from the cryptocurrency community. However, right now it is feeling better than ever and is, for the first time, ready to challenge Ethereum.

Bitcoin Cash (BCH)

Bitcoin Cash came to be due to a schism between Bitcoin Core developers. One group wanted to increase the size of a block in the chain. Others insisted that the issues with the transaction cost should be solved with less intrusive methods. In 2017, the “rogue” developers split and created a new currency — identical to Bitcoin, but with larger block size.

Despite controlling almost 5% of the cryptocurrency market capitalisation, Bitcoin Cash does not have great prospects. In 2018 the mainline Bitcoin introduced a Lightning Network, which is a different, yet a more conventional solution to the transaction cost issues. Since then, BCH is a just another altcoin, although a particularly popular one.

What Will The Next Decade of Crypto Look Like

The world of cryptocurrency changes daily, so making any kind of a forecast is impossible. However, some recent trends promise a better, more healthy tomorrow.

We reached out to Igor Afa, a financial analyst at Forex broker JustForex, and asked to share his vision of the next cryptocurrency decade. Here are his points:

  • Bitcoin will remain a dominant currency, yet it will lose some market value to its competitors.
  • Ripple and Ethereum will grow and start challenging Bitcoin’s dominance. Neither will come as close as Ethereum in June 2017.
  • Bitcoin Cash will not advance from its positions, but likely won’t fade away either. A large number of users acquired during the split will keep it afloat.
  • Should Tether, Petro and other stablecoins succeed, they will take over a niche market segment.

Of course, this doesn’t take into account things that are impossible to predict. For example, cryptocurrencies might be banned. Or Vitalik Buterin will take that job at Google and run Ethereum into the ground. Or maybe an entirely new cryptocurrency will appear, with a completely unique offering, and take over the market.

Overall, the market will become a little healthier. It still won’t be anywhere near normal, but at the very least we won’t have a whole market living and dying on a single entity. Which, all things considered, is already a huge win.

Disclaimer: Readers should do their own due diligence before taking any actions related to any company, product or service mentioned in this article. BitcoinAfrica.io is not responsible, directly or indirectly, for any loss or damage caused by or in connection with the use of or reliance on any content, product or service mentioned in this sponsored post.

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Problems Nigerians Face With Bitcoin and Cryptocurrencies

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Bitcoin to Naira

Nigeria is ranked as Africa’s largest country with the most crypto traders and ranks third globally. The country accounts for the largest volume of cryptocurrency transactions outside the United States. In the last six months, it has been recorded that about 35% of the Nigerian population has traded cryptocurrency.

As encouraging as these numbers may be, Nigeria, as an environment, has been very unfriendly to cryptocurrency and its related aspects. Last year, the Central Bank of Nigeria ordered all commercial banks and lenders to stop transactions or operations in cryptocurrencies, citing a significant threat to the country’s financial system.

The ban on cryptocurrency in Nigeria was big negativity to the Nigerian youth, especially knowing that over 50 million of the population are involved in cryptocurrency. During this time, a lot of crypto trading platforms were shut down in the country. Also, many bank accounts suspected of dealing with cryptocurrency were locked, including their funds.

Even today (as of May 27, 2022), any bank transaction with a description or notes of “crypto,” “bitcoin,” “P2P,” or any crypto-related words will be locked away alongside the account(s).

The unfriendly treatment of cryptocurrency in the country is alarming. In the plight of making a positive solution, the community led to adopting systems where crypto traders could trade cryptocurrency without involving the bank.

Top 4 Problems Nigerians Face When Dealing with Cryptocurrency

  1. Where to Buy or Sell Cryptocurrencies

Today, finding the right crypto trading platform that works for you significantly can be frustrating. Many cryptocurrency exchanges came into existence to aid in safer cryptocurrency transactions in the country. In this plight, some fraudulent platforms were made in disguise to exploit money from crypto investors. How would Nigerian crypto traders know which platform is genuine or not? With some checklists for selecting the best crypto exchange in Nigeria, you will be given key guidelines on how to choose the best place to sell bitcoin in Nigeria.

  1. Speed of Transactions

A fast crypto transaction is important as the speed of cryptocurrency may block. Most times, transactions take hours to complete. Ideally, crypto transactions on regular crypto trading platforms take between 10 minutes to one hour. Surprisingly, some take over 5 hours. However, a few crypto transactions can take less than five minutes, depending on the app. In cases where we need transactions done quickly, or we accept crypto payments for your business, how do we intend to confirm payment before allowing customers to take their products? Should the customer wait for hours?

The speed of transactions has been a damaging factor for most Nigerian crypto traders. This has been a reason why many Nigerian companies find it difficult to accept cryptocurrency as payment options for their businesses.

  1. High and Inconsistent Fees

Crypto transaction fees are another issue many Nigerians face. To really compare the best options for you, you have to look at the fees before and after conversion. What are the withdrawal fees, processing fees, and receiving fees,… These fees cause a huge discouragement in crypto trading in the country.

  1. Limitations

It is saddening that many Nigerian crypto traders cannot make transactions because many of these crypto trading apps have put some limits on how much they can withdraw, receive, buy or sell. This breaches the purpose of cryptocurrency. Cryptocurrency has made it easy for people to send money from one place to another without a barrier. Why should I not be able to receive my funds because it is below your limit for withdrawal?

Limitations have made many Nigerians lose interest in cryptocurrency or lose their cryptos.

These factors, alongside many others, have caused the trading of cryptocurrency in Nigeria very difficult.

How Breet Solves Some of the Issues Nigerians Face in Cryptocurrency

Breet is an OTC crypto exchange platform that allows users and businesses who simply want to receive crypto and get a flat equivalent of their coin to convert their crypto to cash money immediately. 

Breet App

With Breet’s over-the-counter system, you are saved from the hassle of boring explanations of what and how crypto works and tedious illustrations of cryptocurrency market charts. Breet enables users to securely convert and withdraw their crypto coin to cash money in less than five(5) minutes without the use of peer-to-peer trading or any third-party agent.

Breet is a revolutionary new way to convert and withdraw your crypto coin without the need for peer-to-peer trading or any third-party agent. With just one click, you can have cash money in hand within five minutes.

With Breet, you can sell your cryptocurrency in less than 5 minutes. This is an incredible feature on its own, meaning businesses can now accept cryptocurrencies as payment options without having their customers wait for hours to confirm payment.

Breet is also completely free. There are no hidden charges, no withdrawal fees, no processing fees and no receiving fees. There are zero charges with Breet. Breet’s free usage solves the issue of high and inconsistent charges for many Nigerian crypto traders.

Breet

There is no limitation to how much you can receive or withdraw on Breet. You don’t have to have about 10,000 Naira worth of cryptocurrency before you can withdraw. You can even withdraw as low as 100 Naira with Breet Exchange.

Breet is simple, free and certified. There is not much sugar coating to tell before believing that Breet is, arguably, the best crypto trading platform in Nigeria currently. The incredible reviews on the Breet app give perfect evidence.

What more do you need? If not, a crypto exchange that makes crypto transactions easy and makes people happy. You should become a Breet user by downloading Breet mobile app available on all Android and iPhone devices.

Remember being a crypto trader in Nigeria can be challenging. This is why it is important for you to learn more about cryptocurrency and the latest news by doing your own research.

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Ethereum Timeline: Shift to Proof of Stake

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Shift to Proof of Stake

The much-anticipated transition of the Ethereum network from proof-of-work (PoW) to proof-of-stake (PoS) consensus is finally taking place. The adaptation of PoS has always been the plan and a vital part of scaling Ethereum by future upgrades. However, abruptly shifting to PoS can pose significant technical and community challenges that are not as simple as using PoW to achieve network consensus. Having said that, what exactly are PoS and PoW?

Proof of Work

Proof-of-work (PoW) is a consensus algorithm that allows for the secure, decentralised verification of transactions on a blockchain. In a PoW system, miners are responsible for verifying and committing transactions to the blockchain. During the verification process, miners compete against each other to solve complex cryptographic puzzles. The first miner to solve the puzzle is rewarded with cryptocurrency, and the transaction is added to the blockchain.

Reasons To Shift From Proof of Work

The Ethereum ecosystem has evolved at an astounding rate in the last year. This growth was primarily due to a significant emergence and explosion of NFTs and Decentralised Finance (DeFi) initiatives. While the change-over was imminent, some factors to be considered for the same are:

  • The PoW consensus protocol requires users to utilise significant computational power to validate transactions and add new blocks to the network.
  • Users who devote their computational resources to the shared ledger are miners.
  • These miners are rewarded with Ether tokens in exchange for the computing power they have supplied to the network.
  • With PoW consensus, Ethereum takes up to 113 terawatt-hours of electricity in a year. According to Digiconomist, it is more than the total electricity consumption of the Netherlands per year.
  • The current Ethereum transaction with PoW consensus takes up energy equivalent to the consumption of one week of energy of an average US household.

With so many downsides to its cap, PoW has many advantages, which is one of the main reasons it has been a reliable consensus for so long. The PoW consensus has been robust and secure all these years. But the consensus can be utilised by a cryptocurrency with a massive valuation and relatively simple use case, such as the bitcoin. With the amount of energy and power involved, it becomes difficult for individuals to meddle with a high valuation asset.

Proof of Stake

The consensus protocol Proof-of-stake (PoS) has been introduced to address the issue of over-mining. Proof of stake (PoS) is critical to understand because it could eventually replace the proof of work (PoW) consensus mechanism that is currently used by most cryptocurrencies.

“PoS is a way to achieve decentralised consensus without using energy-intensive mining. It is an alternative to the more common proof of work algorithm. With PoS, a cryptocurrency’s blockchain is secured by its token holders who are required to lock up their tokens as stake and not by miners equipped with powerful hardware. It’s an energy-efficient, cost-effective and therefore, a popular choice for crypto giants like Ethereum,” states Dev Sharma, CEO of Blockwiz, a crypto marketing agency.

In contrast to PoW, in which the individual who completes the mathematical proof first is rewarded with new coins, with PoS, no new coins are created.

Benefits of Proof of Stake Consensus

Proof-of-stake introduces several enhancements over the PoS mechanism:

  • Improved resource proficiency – you don’t need as many energy mining blocks.
  • Minimal entry barriers, lower hardware requirements – Even if you don’t possess top-tier hardware, you still get ample opportunities to participate in the creation of blocks.
  • More excellent resistance to centralization – PoS would imminently facilitate the generation of more nodes.
  • Staking facilitates the operation of a node. It does not necessitate significant expenditure on equipment purchases or resources, and if you lack the ETH token to stake, you cannot participate in staking pools.
  • Staking consensus enables reliable sharding. Shards enable Ethereum to generate new blocks simultaneously, leading to enhanced throughput of transactions.
  • In a PoW mechanism, sharding the chain would reduce the amount of energy required to modify a particular network section.

In a Nutshell

Proof of stake (PoS) is a type of algorithm used by cryptocurrencies to determine who gets to create new blocks on the blockchain. PoS works by requiring users to lock up some of their currency in a smart contract called a stake. In return, they are given the right to validate blocks on the network and earn rewards.

The advantage of PoS is that it doesn’t require the massive energy consumption that PoW does. This non-dependency on massive energy utilisation makes it more environmentally friendly. It reduces the risk of centralisation since few users would be able to control the majority of the currency. Therefore, it’s no wonder that Ethereum is making the much-anticipated switch.

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Amber Group March Recap 2022: Here’s What Happened

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Amber Group NewsNamed one of CB Insights’ 2022 Blockchain 50, an annual ranking of the most promising blockchain and crypto companies in the world.

Announced the appointment of Ehsan Haque as the General Counsel for Europe, Middle East, and Africa (EMEA)  region.

CEO Michael Wu was selected as a recipient of the “Top 100 CEOs in Innovation Award 2022” by Word Biz Magazine.

Product Development and Partnerships

Amber Group Partnerships

Participated in Mina Foundation’s token sale, EthSign’s seed round, and Zecrey protocol’s angel round.

In the News

Michael Wu CEO Awards

World Biz Magazine: Michael Wu, CEO of Amber Group – interview WBM Top 100 Innovation CEO.

CNBC: For crypto to be adopted globally, we will have to comply with regulators: Crypto-trading platform.

Bloomberg: Bankers Who Stay in Hong Kong Are Rewarded With a Pay Bonanza.

Economist: EthSign raises $12 million in stable coin led by Sequoia Capital India, Mirana Ventures.

Forkast News: From crisis currency to consumer adoption: What next for crypto?

CoinDesk: Mina foundation raises $92M to accelerate adoption of Zero-Knowledge Proofs.

Cointelegraph: If the glass slipper doesn’t fit, smash it: Unraveling the myth of gender equality in crypto.

AMBCrypto: Amber Group strengthens management team with Ehsan Haque as EMEA General Counsel.

CoinCu: Zecrey protocol has raised $4M in an angel fundraising round.

Chain Debrief: Is the user experience in DeFi bad? Opportunities, challenges and how to see growth in DeFi.

Medium: Reproducing the $APE airdrop flash loan arbitrage/exploit.

Medium: Non-fungible trends.

Events and Media Appearances

Michael Wu

CEO Michael Wu joined Forkast News to discuss crypto’s consumer adoption and what’s next for crypto.

CEO Michael Wu joined CNBC Street Signs Asia to share how Amber Group seeks a balance between regulation and crypto development.

CEO Michael Wu gave an interview with Economist Impact at Technology for Change Week on how to stay ahead of the curve in the fintech space.

Managing Partner Annabelle Huang joined Economist Impact’s Asia Trade Week to discuss the future of crypto as payment in Asia.

Managing Partner Annabelle Huang joined Avalanche Summit to discuss the opportunities and challenges in DeFi.

Managing Partner Annabelle Huang joined Goldman Sach’s panel discussion on “Digital assets – Investing in the future” to celebrate International Women’s Day.

Annabelle Huang

Managing Partner Annabelle Huang gave a guest lecture on DeFi and Web3 for the International Finance class at Singapore Management University.

Managing Partner Annabelle Huang joined the DIG FIN VOX podcast to talk about Amber Group’s move to Singapore and into retail.

CSO Dimitrios Kavvathas joined Blockchain Africa Conference 2022 to discuss institutional investment in crypto.

CSO Dimitrios Kavvathas joined FinTech Festival India at a panel discussion on “De-Fi – A better solution for peer-to-peer lending”.

CSO Dimitrios Kavvathas joined the World Blockchain Summit in Dubai at a panel discussion on “Fostering the global crypto ecosystem”.

Dimitrios Kavvathas

Europe Managing Director Sophia Shluger delivered a keynote speech on digital wealth at Blockchain Africa Conference 2022.

Europe Managing Director Sophia Shluger joined the CryptoCompare Summit in London to discuss the building blocks of the new digital economy.

Europe Managing Director Sophia Shluger joined the FundFocus Europe 2022 conference to discuss the foundation for the widespread institutional adoption of cryptocurrency.

Sophia ShlugerRear

Latin America Managing Director Nicole Pabello joined the Ethereum Rio conference to discuss the LATAM Ecosystem in the world.

Nicole Pabello

Institutional Sales Director Justin d’Anethan joined EmergentX’s Annual Digital Asset Summit to discuss the institutionalizing of the digital asset industry.

Justin d'Anethan

Managing Director Ben Radclyffe joined Credit Suisse’s Asian Investment Conference to discuss the spillovers between crypto and equity markets.

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