2018 ‘Mature’ Crypto Market Will Draw More Investment, See Less Volatility, Analyst Says

Adrian Lai, founding partner of Hong Kong-based crypto investment firm Orichal Partners, has forecast that in 2018 the crypto market will “mature” and increase its trading volume, particularly among institutional investors, the South China Morning Post reported April 9.

Lai characterized both last year’s eye-popping market cap growth — reaching an all-time high of over $800 bln by early Jan. 2018 — and its subsequent first quarter spiral to $256 mln, as of today, April 9, as “irrational.” He attributed this staggering volatility to a lack of regulatory oversight and institutional investment, but struck a decisively optimistic tone about the future, saying that:

“Regulators are not banning the development of cryptocurrencies, but are trying to better regulate the market, which should help the industry mature (…) If the regulatory stance gets clearer, large funds will be more assured and willing to commit significant capital.”

2018 has already seen considerable regulatory momentum pertaining to the crypto sphere, lending credence to Lai’s position. The US Commodities Futures Trading Commission (CFTC) and Security and Exchange Commission (SEC) hearings in Feb. 2018 were devoted to crypto regulation.

The US, Japan, and South Korea are all currently debating and issuing regulation for virtual currencies, Blockchain, crypto exchanges and ICOs, as well as considering taxation frameworks, with some admitting that regulatory measures are not fully developed.

In January, Cointelegraph reported that venture capital (VC) Blockchain investment in 2018 is already on track to exceed 2017’s numbers, with notable investments including $140 mln VC already raised from Goldman Sachs, Baidu, and CICC for Circle’s recent acquisition of the Poloniex crypto exchange, as well as VC Firm Digital Currency Group’s investment in crypto-friendly Silvergate Bank.