by Aubrey Hansen

No matter what the headlines say or what your personal feelings toward crypto are right now, 2018 has been an exceptional year on quite a few fronts for blockchain and crypto, especially with respect to adoption, Fintech, and regulation.

It’s not been an easy year in the blockchain and crypto space. After the highs of December 2017 and January 2018 through to the current bearish market conditions, many people within the community are feeling pessimistic, at best, about the future of crypto. This is echoed by the press, with headlines suggesting the death of the industry or questioning whether the crypto winter will ever give way to a warmer, brighter spring.

Crypto adoption, however, is at its highest level ever. Figures released by the Cambridge Centre for Alternative Finance this year indicate that there were 18 million crypto users at the end of 2017, and that figure nearly doubled in 2018 to an impressive 35 million users.

Wirex, a digital money platform that allows you to convert and spend your crypto and fiat currencies, recently announced that they had surpassed two million users. A partnership between Manticora Capital and Pundi X saw crypto users being able to spend their crypto in around 1,000 stores in Colombia.

In Australia, a partnership between the Cointree exchange and payment provider GoBill allows residents to pay their household bills with a range of cryptocurrencies, while Brisbane Airport became the first airport in the world to allow payments in Bitcoin in association with TravelByBit.

In another sign of global adoption, it was recently announced that there are now 55 million unique Ethereum addresses. Interestingly, this figure has surpassed the total number of unique Bitcoin addresses.

The state of fintech development and investment

At the beginning of 2018, there was a sense that banks and financial industry figures were unsure about blockchain.

However, despite the naysaying, 2018 could be the best year ever for fintech development and investment. According to a mid-year study released by KPMG, “In the first six months of 2018, global investment in fintech was exceptional, driven in part by two massive deals – the $12.9 billion acquisition of WorldPay by Vantiv and the $14 billion venture capital (VC) funding round raised by Ant Financial. Funding to date has already exceeded the total amount of Fintech funding seen in 2017 and is well on pace to exceed 2015’s peak.”

According to the same study, VC investment into US-based blockchain fintech projects in the first half of 2018 was far greater than all of 2017. These numbers were in part due to more than US$100 million investment into Circle Internet Finance and Paxos’ Series B raise. The report cites “the widespread applicability of blockchain to help harness efficiencies within financial institutions” as a primary driving force behind investment and industry growth. While not full-year statistics, these figures do suggest a positive trend.

This year was also a great year for challenger banks like Revolut and N26, with both companies receiving investments to drive their expansion ? although they are not blockchain-based.

Traditional banks have also begun the process of blockchain adoption. Santander recently became the first UK-based bank to deploy blockchain technology, and Barclays recently applied for twin blockchain patents as a way to streamline settlement between accounts.

Regulating the industry

There is plenty of positivity on the regulatory front. Malta cemented its place as the first ‘Blockchain Island’ in July 2018 when it passed three cryptocurrency and blockchain bills that were designed to give companies the tools required to operate and flourish in a regulated environment. The three bills made Malta the first country in the world to formally provide an official set of regulations for business operators within the crypto and blockchain space.

Also, many European countries like Estonia and Liechtenstein, are already crypto-friendly and some of the institutions of the EU may looking at ways to introduce a uniform set of appropriate regulations across all member states.

So, at the very least, there has been increased adoption, companies like Wirex and Pundi X facilitating the use of crypto to pay for goods and services, massive investment into blockchain-based Fintech, mainstream banks employing blockchain technology to streamline their products and services, and the introduction of sensible crypto regulations.

When you look closer, it looks like there’s a very positive crypto story starting to emerge from 2018 which makes 2019’s prospects rather interesting.

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