Saturday, 04 December 2021 08:40 GMT

UAE- There's more to cryptocurrency than bitcoin


(MENAFN- Khaleej Times) Last year proved to be a record year for cryptocurrencies, with many posting more than a 10,000 per cent increase in value.

As the popularity of cryptocurrencies continues to grow, especially among millennials, finance analysts and government regulators are keeping a close eye on what is essentially considered to be a technology in its early stages. With many expecting another stellar year for cryptocurrencies such as Bitcoin, analysts at the Dubai International Blockchain Summit (DIBS 2018) said there would be an increased focus on improving accessibility and quality in the cryptocurrency sphere in 2018.

"For me, 2017 was very much a year of speculation and volatility, and I think that 2018 will be a year of transitions, with a focus on institution funding," says Sally Eaves, CTO and thought leader in emergent technology. "We will also see a lot more initial coin offerings [ICOs] coming out, and there will be big changes that will be coming in a few months in terms of regulations. We have seen things moving across the board in China as well as the UK, and this is a great move from an investor's point of view, as it improves quality. There are platforms coming out with built-in additional security."

Simon Cocking, ICO advisor and senior editor of Irish Tech News, looked back at the industry in 2017, and said the rise of cryptocurrencies can be partly attributed to traditional currencies being at the mercy of governments and policy, whereas a cryptocurrency's main selling point has always been decentralisation.

"Bitcoin is the one that everyone has heard of, so the story is almost always driven around that cryptocurrency," he said. "However, I think it is also important to look at other cyptocurrencies in the market today. More than one cryptocurrency is being launched every single day, so there are more out there today than just Bitcoin. To get value, do your research and look at options."

The total value of cryptocurrencies is estimated at over $750 billion, according to CoinMarketCap, and Bitcoin dominates with around 34 per cent of that market. According to recent statistics, the price of Bitcoin rose almost 2,000 per cent, from $1,000 in January to over $19,000 at its peak in December. In terms of popularity, Bitcoin remains the crowd favourite of the alternative currency market.

According to a survey by Blockchain Capital, 30 per cent of millennials aged between 18 to 34 years would rather invest $1,000 in Bitcoin than $1,000 in government bonds or stocks. The study also revealed that 42 per cent of millennials have heard about Bitcoin, compared to a 15 per cent awareness among those aged 65 and up.

However, when it comes to gains, Ripple was the highest performing, with a 36,018 per cent rise in value, followed by NEM, Ardor, Stellar and Dash. Similarly, Ether, which has only been in existence for two years, saw an impressive leap in popularity. On January 1, 2017, one Ether token cost around $8, before jumping to over $400 the same year - a 4,200 per cent gain.

Experts note that 2017 was also the year of the ICOs, with almost $3.7 billion being raised. CryptoKitties became a blockchain sensation as sales hit $12 million in their first month. More surprisingly, Dogecoin, a cryptocurrency created as a parody after a popular Internet meme, saw its market cap crack $2 billion.

Morgan Stanley has estimated that hedge funds invested over $2 billion in cryptocurrencies. The investment bank further detailed that more than 100 crypto-related hedge funds have sprung up over the past six years, with 84 of the funds launched in 2017 alone.

Speaking on the future of cryptocurrencies, Zac Cheah, CEO and co-founder of Pundi X, said many developers want to completely de-couple from the traditional banking system. "There is no point to use a crypto card that has to go through the traditional payment channel. What we want to do is to support all the crypto cards and online wallet applications out there to pay through a real blockchain."

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Rohma Sadaqat I am a reporter and sub-editor on the Business desk at Khaleej Times. I mainly cover and write articles on the UAE's retail, hospitality, travel, and tourism sectors.Originally from Lahore, I have been living in the UAE for more than 20 years. I graduated with a BA in Mass Communication, with a concentration in Journalism, and a double minor in History and International Studies from the American University of Sharjah.If you see me out and about on assignment in Dubai, feel free to stop me, say hello, and we can chat about the latest kitten videos on YouTube.

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