Cryptocurrency has made remarkable strides in a short period of time, as evidenced by the combined market value of all cryptocurrencies soaring to $3 trillion in November 2021. However, unfavorable macroeconomic conditions and a number of prominent players going under, most notably FTX, caused the value to plummet to below $800 million in 2022. Despite this, as per the latest findings from GlobalData, the market has bounced back, currently standing at $1.1 trillion.
Nicklas Nilsson, Consultant of Thematic Intelligence at GlobalData, believes that the polarizing nature of the crypto market and its rapid evolution are some of the main challenges when it comes to monitoring it. Social media analytics have revealed that major crypto events usually spark lively conversations across various platforms.
Over the last few years, the collective market value of cryptocurrencies has seen a surge of near 400% compared to pre-pandemic levels, while crypto ownership is now above 425 million. Additionally, institutional interest is still strong, as evidenced by BlackRock’s recently filed application for a bitcoin ETF. The rapid pace of innovation within the crypto space, ranging from the launch of new token types to the development of scalability solutions, further shows the industry’s progress.
Regulatory obstacles remain a major hurdle to wider crypto acceptance. Although numerous countries have attempted to introduce regulations, the approaches vary. The EU is currently leading the way with its Markets in Crypto-Assets (MiCA) bill, which seeks to create a consistent regulatory framework for all member states by 2025. Other jurisdictions, such as the UK, Singapore, and Japan, are also actively formulating their own rules and regulations, demonstrating a shift from banning crypto to regulating it.
While cryptocurrencies still face many obstacles on their way to widespread acceptance, they have come a long way in a short time. The industry is expected to remain volatile, but major transformations are predicted in the coming years.
