Out of the Ashes: Four Trends to Shape Crypto in 2020

A year of breakneck trial and error, development and refinement has seen the cryptocurrency market break into entirely new territory.

Popular sportswear manufacturer New Balance began using the Cardano blockchain in its global supply chain; Malta's Gambling Authority tested cryptocurrency in casinos; and the Bank of France said it will initiate trials for a digital currency in early 2020.Second, there has been an explosion in the size and accessibility of crypto derivatives.

Looking at BTC Perpetual Futures, we can see how the market is becoming increasingly competitive as major exchanges begin to make inroads.

Substantial progress has been made worldwide with respect to regulation, encouraging financial market institutions to wake up to the potential of digital assets - both in terms of their ability to change the economic landscape and to offer an uncorrelated asset class.

With companies such as JPMorgan beginning to implement their own digital currencies, it is fast becoming clear that even the digital markets' biggest critics recognise this potential.

A surge of interest in crypto markets came in June with the Facebook Libra announcement: CME Group's cash-settled bitcoin futures saw open interest hit an all-time high of 5,311 contracts totalling 26,555 BTC, then worth around $246m.

In the private sector, regulated platforms have built out market infrastructure to accommodate mainstream demand.

As we look back over the last twelve months, the digital asset markets have diversified and grown.

New trading facilities allow for more sophisticated strategies, as new service providers turn crypto from fringe asset class to fintech innovation hub.

Vital market infrastructure and products tailored to a more sophisticated investor base are now readily available, encouraging traditional firms to enter the asset class.