2019 was a fascinating year on the crypto sector, with Bitcoin possibly laying the foundation for its next bull run and many changes taking place within the cryptocurrency industry’s overall environment in terms of assets, developments and even legislation.
The market is maturing, investors are becoming more savvvy and crypto companies have started to adapt to the new market environment by providing innovative products and services that meet new, rising trends.
With the closing of 2019, it’s time to start looking forward to the new year, and examine any emerging trends across the cryptocurrency market that could have a major impact on the space’s future.
Institutional Investors Enter the Market
Bitcoin just turned 11 and while a decade is indeed a long time, it and other cryptocurrencies are among the industry’s largest financial asset groups.
To date, the value and price action of the young digital asset class has been driven mostly by retail investors and early adopters who either became attracted to the asset class because of the promise of the underlying technologies behind each asset, or because of the promise of untold wealth generated by buying an asset before it starts.
But the tides are turning, and late 2017 retail traders burnt by the bubble pop have left the market almost entirely, and taking their place is a flood of institutional investors.
Combining Crypto With Traditional Assets
Retail investors, who stuck with crypto, have learned more about investing and trading through the evolving digital asset class, and have since matured considerably. Although usually beginning with crypto assets due to ease of access and lack of fulfillment of certain investor requirements, they have since started to take an interest in other, traditional financial markets and properties.
Bitcoin traders have become particularly interested in building portfolios across other, uncorrelated assets to offset their risk exposure and open up new profit-making avenues.
After learning to trade over the past few years, Bitcoin and crypto traders are now actively trying their hands in other markets, including commodities and stock indices.
Furthermore, Bitcoin traders may increasingly look toward precious metals such as gold and silver, which are that in the face of economic turmoil alongside Bitcoin.
The increase in interest from traders and investors seeking access to traditional markets has led to a number of crypto-trading platforms adding physical assets to their portfolio of digital assets.
Through strategically distributing capital across a number of uncorrelated and anti-correlated markets, traders can now further mitigate risk and increase the profit potential. The phenomenon is something all traders will consider when offering additional assets outside of cryptocurrencies on their platform of choice.
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