Leading Cryptocurrency Executives Assess the Current Market and Share Future Predictions

eToro CEO Yoni Assia, Bitstamp CGO Barbara Daliri, Utrust CEO Sanja Kon, and Finoa COO Michaela Fleischer joined the Tech.eu Fintech event and discussed the present and future of the cryptocurrencies.

During his Q&A session, Yoni Assia talked about the reasons behind the volatility and adoption of cryptocurrencies, as well as his expectations of the crypto space by 2030.

Following Assia, Daliri, Fleischer, and Kon discussed how far the adoption scale could go, who is responsible for market volatility, and what problems could be solved through crypto education.

Crypto’s Present

Two questions were discussed in the crypto present: why is there such high volatility, and what does the high adoption rate tell us?

Volatility

BTC volatility (30D) (via theblockcrypto.com)

The chart above shows the 30-day moving average volatility index for Bitcoin, where volatility is defined as the standard deviation of daily earnings.

The most recent all-time low Bitcoin volatility was recorded in July 2020. Since then, the volatility has only continued to rise. The spikes recorded in December 2021 and early January 2022 were relatively calm compared to Bitcoin’s history. However, the sanctions against Russia caused an increase in volatility.

Price volatility has always been a problem for all crypto assets, especially Bitcoin. Sudden moves within an hour window have become the norm, and according to big-name crypto executives, the volatility is not about to die down anytime soon.

eToro CEO Yoni Assia argues that the high volatility in the market is a result of an imbalance between “regular” owners and institutional investors. According to him, the prices of cryptocurrencies are affected by the following:

“First, genuine contributions from regular users of all generations. Secondly, institutional investors, who are attracted to the market because they are intrigued by the high level of uncertainty”.

He further explained:

“When the second players see an increase in market fear, they immediately sell out and create more instability. These two are not in the right balance, so we still experience volatility. The volatility will continue to exist until they find the right balance.”

Following Assia’s session, Barbara Daliri and Michaela Fleischer addressed market volatility from a broader perspective.

Daliri mentioned that volatility is an unavoidable part of all financial systems and should not discourage investors. Famed investor Anthony Pompliano has also stated a similar approach.

Fleischer agreed with Daliri and further added:

“Crypto is a very young market. New actors of all sizes are brought on board every day, and not all of them are well educated. They all contribute to volatility.”

Both Fleischer and Daliri highlighted that the crypto market is much more stable compared to its early years and will only become less and less volatile over time.

Adoption

According to Chainalysis’s 2021 Cryptocurrency Geography Report, cryptocurrency adoption has skyrocketed in the last twelve months.

Global crypto adoption rate (via on-chain analytics)

The chart above shows global adoption at 2.5 at the end of Q2 2022 and 24 at the end of Q1 2021, indicating 881% growth in less than a year. Overall adoption from inception to today shows growth of over 2,300% since 2019.

Chainalysis research revealed that the reason behind increased adoption differed around the world. Emerging markets turned to cryptocurrencies to preserve their savings against currency devaluation, issue transfers, and transact business. On the other hand, the markets of North America, East Asia and Western Europe grew through institutional investments.

Comments from Yoni Assia, Sanja Kon, and Barbara Daliri on increased adoption also drew parallels to the Chainalysis report.

Assia cited the increased adoption among individual users, arguing that it increased due to two factors: ownership and hedging capabilities. He argued that Bitcoin’s scarcity allowed it to behave like gold, which is a primary hedge against inflation. With fiat-based investments losing huge value due to COVID, people looked to crypto for relief.

Asia noted:

“Money is not necessarily a safe haven and now people realized that they needed to learn how to invest their money. Bitcoin is a government inflation hedge because its scarcity transforms it into a form of digital gold.”

He also argued that with cryptocurrencies, people would be able to own their own money and take advantage of the various investment opportunities. He added:

“The rest of the elements of cryptocurrencies, such as smart contracts and NFTs, bring their own value to the market. Each represents a different type of investment opportunity, completely different from the capital markets and owned exclusively by asset holders. That’s why we see genuine adoption from all generations.”

Kon mainly focused on the adoption of commercial transactions. He mentioned that when Utrust was launched, all Utrust merchants accepted cryptocurrency payments only if they were immediately exchanged for fiat currencies. Now, more and more merchants are getting used to accepting cryptocurrencies as payment without exchanging them. She said:

“Today, more than 50% of our merchants, even small ones, accept Bitcoin or stablecoins as a form of payment and keep them that way. These numbers tell us that traders are likely to understand crypto as a valid asset.”

Daliri, on the other hand, drew attention to the growing number of industrial players. He argued that big players were entering the crypto space around the world, and their involvement increased the credibility of cryptocurrencies. He added that with the help of regulations, inter-institutional adoption would increase even more.

The future of cryptocurrencies

When it came to the future of cryptocurrencies, Barbara Daliri and Sanja Kon spoke about the importance of education, while Yoni Assia shared her bold predictions.

Education

One of the main things that all executives agreed on was the importance of education for newcomers. Daliri and Kon argued that lack of education hurt the market by causing volatility and the individual by causing serious losses. Furthermore, these damages also negatively affected public opinion about cryptocurrencies.

While discussing the current volatility, Daliri stated:

“Teaching newcomers about the mechanics of the market is vital to curing volatility. With the right training, we could keep the great players from quitting. We can also teach everyone how to hedge against volatility to avoid losses, which eventually creates the volatility itself.”

Kon agreed with Daliri, adding that education can be an accelerator for adoption and regulations can increase education. She said:

“Both merchants and customers dealing with crypto want peace of mind. We can provide it by building trust and educating them. Lack of education is one of the main barriers to adoption. As regulations take hold, they should also help with education levels.”

Yoni Assia’s predictions

During her Q&A session, Assia mentioned that the change we saw was just the tip of the iceberg. She argued that the crypto community was growing day by day and that people were not only participating but identifying with it. She added that the next 10 years will demonstrate how cryptocurrencies will affect our lives on a larger scale.

He stated:

“As people move towards an inevitable digital economy, we will see revolutionary changes in the next 10 years. We will definitely have a wallet built into every browser by 2030. This is inevitable. Crypto as an asset will advance enough to make this a necessity.”

He also mentioned his reliance on NFTs, saying:

“All the crypto-related features are amazing. But NFTs are the most unique things ever created. They are incredibly solid investment options. They also have unique features that can be used in deep ways. In the future, NFTs will become an important part of our lives, beyond investments.”

Assia concluded her remarks by agreeing with Kon, saying that eToro’s main concern is polishing its user experience and contributing to its education in an effort to further increase adoption.