Our annual cryptocurrency predictions are a must-read. In the 2020 edition of our cryptocurrency predictions we feature the grand (secular) crypto bull market to continue even though some consolidation may be in the cards as per our Bitcoin forecast for 2020. Institutional capital will continue to pour into crypto even though this process appears to be going slower than anticipated. Crypto will increasingly integrate with real world applications. XRP will move in a wide rounding bottom formation which is ultimately bullish long term, as per our XRP forecast. And Ripple’s Swell will set the bar for what ‘real life adoption’ means.
Let’s first review what we said last year, in all openness and transparency. We’ll continue with next year’s predictions.
Last Year’s 5 Cryptocurrency Predictions
In last year’s edition of our annual cryptocurrency predictions we predicted the following. We want to openly indicate what went well and what not in last year’s cryptocurrency predictions.
- Institutional money as the catalyst for the crypto bull market. It turned out that the crypto bull market continued, but it was not yet institutional capital driving it. This process of institutional money pouring into cryptocurrencies is going slower than expected.
- Bitcoin’s upside capped is what we said a year ago. This might still be the case longer term but for now it appeared that Bitcoin was the cryptocurrency that was most solid in its retracement in the 2nd half of 2019. Most cryptocurrencies fell back to their early 2019 lows while BTC is ending the year almost twice as high as its open.
- XRP becomes the new BTC. Here it becomes very interesting. XRP clearly is the cryptocurrency with most traction in real life. In terms of ADOPTION there is not any other cryptocurrency that comes even close to what XRP is doing, at scale. However, the XRP price has not reflected this potential. Admittedly, a big disconnect between the XRP price and our expectation a year ago.
- Only added value cryptocurrencies would do well. This appeared to be partially true. It is true that no value add cryptos did outperform, and are facing existential risks (rightfully so). However, several value add cryptos are ending the year on a not so positive note neither which is due to the crypto bearish bias in the 2nd part of 2019.
- Blockchain implementations would accelerate. This certainly appeared to be true, even though the number of crypto enabled blockchain applications were not the majority.
So with all this in mind what is in store for 2020? We feature 7 cryptocurrency predictions for 2020 in this article.
Cryptocurrency Predictions for 2020: Giant Secular Bull Market Continues
Bitcoin remains the leading indicator for the crypto market. According to its long term chart BTC looks to be building a long term base.
The long term chart suggests that the pace of the ongoing bull market #3 might slow down compared to the previous bull market #2. Note the emphasis on the word ‘might’. It is not a given, but it might happen.
Based on how Bitcoin will behave around current price levels we might need to adapt our investing strategy: from buy-and-hold to a combination of holding for the long term with medium term trades. How, how much, when … all these questions are what we solve in our premium cryptocurrency investing service. We guide our members in a way not anyone else is doing.
Presumably Bitcoin needs additional time before moving to a state of accelerated rise. That’s in our opinion the message of this chart.
All in all the message of the long term BTC chart is this: the grand secular Bitcoin bull market is still in place, and not going anywhere in the foreseeable future. Similarly, the grand crypto bull market is still intact, in 2020 and beyond.
Cryptocurrency Predictions for 2020: ‘Risk On’ Markets Supportive Of Crypto Bull Market
This may seem like a not very intuitive prediction but we feel strong that this will be a relevant as well as an important one for 2020.
In order to understand this point we have to take one step back. BTC is increasingly connected to the rest of financial markets which is because of the introduction of futures. More than any time before are large traders able to switch their capital from non crypto markets (like stocks, currencies, commodities, gold) to BTC, in two directions.
Because of this we believe crypto markets are more subject to the tactical risk cycles.
The likelihood of a continued bear market as well as big crashes in BTC in 2020 are decreasing expotentially.
Cryptocurrency Predictions for 2020: Institutional Capital Pouring Into Crypto Investments
As said in the introduction the capital from institutional investors came into the crypto market but at a lower pace than expected. Institutional investors need to manage their crypto investments in a different way than the retail public, and have different legal obligations as well as specific restrictions and requirements.
Case in point: Bakkt took almost a year longer than planned to launch to the public. Yes they are growing fast, but started from scratch.
According to this Coindesk analysis there is a slow learning curve among institutional investors. This quote says it all:
The reality is that institutional investors are slowly getting comfortable (learning), and this process will continue to take time. Despite educational progress through 2019, some institutions are wondering if it’s too early to be investing in this space, and whether they can potentially get involved in investing in digital assets in the future and still generate positive returns, but in ways that are de-risked relative to today. Despite a few other challenges imposed on larger institutional investors with respect to investing in digital assets, true believers inside these large organizations are emerging, and the processes for forming a digital asset strategy are either getting started or already underway.
Institutional capital will make a difference, but it will take some more time to reach the tipping point. It may start in 2020 but also in 2021. One thing is sure: in 2020 there will be an acceleration when it comes to institutional capital inflows.
Cryptocurrency Predictions for 2020: Integration with Real World Applications
We will increasingly see integrations between the ‘real world’ and the crypto world.
If you think about it so far the crypto and blockchain world has been pretty isolated. A world that stands on itself.
We believe that 2020 will be a pivotal year in which blockchain / crypto moves closer to the real world. Especially in the enterprise world we will see ways to open up real life data integrations with blockchain / crypto applications.
Case in point: Chainlink is doing amazing work in this field. The list of Chainlink’s partners is pretty impressive, and it illustrates our point. Companies like Google, Alibaba, Oracle, etc are interested to connect data applications ‘offchain’ to the blockchain through Chainlink. See this list here and here. The transaction based statistics of Chainlink show their growth: see this tweet.
Cryptocurrency Predictions for 2020: Adoption Will Beat Non Adoption
Adoption is the what will make the difference ultimately, also in cryptocurrency prices.
However, we did not see an adoption driven price discovery mechanism in 2019. And given the evolution of the crypto market it will not be the key driver for all cryptocurrencies neither in 2020.
The one exception that might start making a difference is XRP. The adoption of XRP in transactions starts becoming really significant. The demand for XRP is growing significantly. With the partnership between Ripple and Moneygram (one of the largest money transfer services worldwide) it is clear how fast the volumes are growing that XRP is transferring from one currency into another currency (one source and another source).
Fortune.com featured the $200M that Ripple raised to accelerate the XRP adoption process (right before 2020 kicked in).
There are only a handful of other cryptocurrencies that come close to similar signs of growing adoption. But 99% of cryptocurrencies show no sign of adoption whatsoever. Sooner rather than later they will disappear.
Cryptocurrency Predictions for 2020: XRP Consolidates in a Wide Rounding Bottom Formation
From a price perspective the breakdown of XRP was an important event of 2019, which came half a year after the amazing crypto rally of April/June.
We believe that XRP is setting a giant rounding pattern. A major rounding bottom or ‘saucer base’ in more technical terms. Eventually this will resolve to the upside, and we believe that XRP will set a major bottom in the first half of 2020 before starting its steady rise.
Our longstanding price target of 20 USD is still valid. XRP will not trade at 20 USD in 2020 obviously, that’s a bit too ambitious, but it will set the stage in 2020 for an accelerated rise later down the road.
Cryptocurrency Predictions for 2020: Ripple’s Swell to set the Bar for Adoption
Last but not least we believe that Ripple’s annual event ‘Swell’ will increasingly set the bar for adoption.
The type of conversations and evolution that was presented at Swell in 2019 is amazing. Again, no other cryptocurrency comes close to achieve what Ripple is doing, which in turn helps realize the full potential of the XRP ecosystem.
Cryptocurrency Predictions Log: Weekly updated throughout 2020
This is a weekly log to keep track on our crypto predictions for 2020. We update this log on weekly basis with short bullet points to highlight whether the crypto market in 2020 is developing according to our cryptocurrency projections outlined in this article.
- First week of January: we see encouraging signs on the BTC chart as the leading indicator for the crypto market. The odds favor a reversal to take place which should help BTC as well as the entire cryptocurrency market tremendously.
- Second week of January: a great start of the week for the price of BTC and other cryptos. They are rising along with BTC. We couldn’t imagine it better than this, great start of the year 2020.
Stay tuned, and keep following our work to get updates on the crypto market. We strongly recommend to sign up to our premium crypto investing service (detailed actionable real-time insights).