2019 is an extraordinary year for blockchain and cryptocurrency. We witnessed the birth of a new alliance, the emergence of new cryptocurrency product transactions, and the survival of bitcoin and Ethereum in the bear market.

The US Congress and many central banks are paying close attention to the benefits of blockchains and digital assets. Even China has invested billions of dollars in innovation, thus fully entering the blockchain competition.

The world’s largest financial companies have developed on the basis of blockchain, and this trend has not slowed down.

Let’s take a look at some trends shaping the blockchain ecosystem in 2020.

Lightning network

Lightning network is a layer 2 payment protocol implemented on any blockchain based cryptocurrency. It paves the way for real-time bitcoin transaction settlement.

The protocol uses off chain data to accelerate transaction processing speed and reduce related costs. In the coming year, we will see more nodes, channels and applications built on Lightning network infrastructure, so that we can realize the unpredictable market efficiency.

Cryptocurrency derivatives

Cryptocurrency derivatives have now grown significantly in size and accessibility. In the early days, only a few exchanges provided such services. Today, most exchanges allow investors to trade futures and large cryptocurrency options.

As more exchanges enter the market, this development will make the market more competitive in 2020.

Decentralized financing

In view of the wide advantages of decentralized financing (also known as defi), it is the future development direction. The value of the defi project has exceeded US $650 million.

Although it was hard to believe a few years ago, the lack of trust and security provisions in financial services has now introduced new loan and margin trading instruments. It enables traders to easily switch between different debt positions.

Ethereum 2.0

Ethereum 2.0 has now entered the final stage of testing, releasing a common multi client test set. Fortunately, the team leading the development of clients and components pays close attention to the feedback provided by the community.

They have also been actively providing updates on progress. This makes people have confidence in the novel Ethereum.

Privacy in transactions

People pay more and more attention to the privacy of intra market transactions. Fortunately, we have also seen the development of privacy tools.

For example, Ernst & Young has developed a nightfall for private transactions in the Ethereum ecosystem. This is a good example of how companies will promote their transactions through the public main network in the case of zero knowledge privacy agreement. We will see considerable momentum in this and multi-party computing.

Cryptocurrency friendly law

In the past two years, Wyoming has promulgated about 13 laws on blockchain and cryptocurrency. Suddenly, the least populous state in the United States became a hotbed of global cryptocurrency companies.

This is because these Regulations are friendly to digital banks and divide digital assets into three categories. When other states and regulators follow suit, this is hardly surprising. We can expect other regulators to do the same in the coming year.

In general, 2002 will be a crucial year for blockchain technology and digital asset ecosystem. We have several main threads to focus on, and 2020 has been a year of continued growth in the use, measurement and adoption of major blockchain protocols and digital assets.

Responsible editor; zl

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