A comprehensive report on the global blockchain industry’s performance was delivered by Dr. Hubery Yuan, Director of Huobi Research of Blockchain application during Blockchain Festival Vietnam on May 24, 2018. Put together by the world’s third-largest cryptocurrency exchange, Huobi, the report contained some key insights into the blockchain industry’s performance, such as data showing that the digital asset industry’s total market capitalisation rose from $17.74 billion to $559.76 billion between 2017 and 2018, a rise of about 3000% in just one year.
Source: Global Blockchain Industry and Prospects Report (2018 1h)
The report shows amongst other things, that crypto asset prices which fell sharply toward the beginning of 2018 are currently priced at levels similar to those of October 2017, indicating that the price falls were a retracement, and not indicative of a larger downward price trend for digital assets.
Bitcoin Remains On Top
According to the report, search activity for digital assets, which is used as an approximate measure of overall interest in each asset type shows that interest in Bitcoin declined sharply in 2017.
Despite this, Bitcoin increased its share of digital asset search popularity over all its major competitors including Ethereum, Litecoin and Ripple. This would appear to indicate that despite the significant retracement experienced by Bitcoin, it still retains top spot in the digital asset investment sentiment ranking. In terms of pricing too, Bitcoin remains at the top of the pile, although it may be experiencing its first real price challenge by Bitcoin fork Bitcoin Cash (BCH) as shown below.
While presenting the report, Dr. Hubery Yuan, Dean of Huobi Research explained that the blockchain ecosystem is experiencing a shift in focus from speculative investment to a model that is driven by both investment and applications. This means that in addition to investors looking to buy low and sell high, as was the case with Bitcoin, a number of cryptocurrencies are now in existence with the purpose of tokenizing activities that create actual value online and offline.
This being the case, he explained, token-token exchanges (like Binance) are expected to become a more prominent part of the ecosystem, and token-fiat transactions are expected to decline in popularity as cryptocurrencies become accepted as a means of exchange and a store of value in themselves, as against merely a speculative asset. The report did, however, point out that the use of blockchain adoption as a goal in itself without establishing a need for it while launching an ICO as is increasingly the case, is not sustainable.
The blockchain is being explored as the next frontier of internet transactions, which gives it a large potential for growth as many conventional internet businesses scrambles to adopt blockchain technology. According to the report “blockchain + use case” can set the market on fire. Crypto Kitty is such one use case; people want to have innovation in playing, Crypto kitty gives you a good user experience and that too on blockchain
The user base of Ethereum is about 20 million which is equivalent to 0.5% of internet user base. This means that despite the explosive growth we have witnessed in the Digital Assets space, we are only just at the beginning.