Will 2019 be just as nail-biting and ulcer-inducing as the previous year?Â
Where is the industry going? Which sectors will feel the technology’s impact the most? Is the ICO really dead?Â
The Iconist asked the ICON Foundation’s Min Kim, ICON Global Business Head Henry Lee and Deblock CEO Hyun Oh to look into their crystal balls and tell us what they see for the blockchain space in 2019. And what they saw was a year in which the industry grows more mature, a year that may finally separate the wannabes from the serious players.
A killer app? Finally?Â
Kim thinks 2019 will be when we get the game-changing service the blockchain space so desperate needs. He says, “One killer use case will finally come through.”Â
Oh is expecting some real-world adoption of blockchain this year, too. “How many users have crypto wallets on their smartphones?”, he asks. “There is no need to have a wallet on their phones, that is why people don’t have them.” But things started changing in Korea last year, he says, when most local ICO projects were reverse ICOs, i.e., projects that already had users.
With even corporate giants like LINE and SK building their own blockchain projects, Oh expects Korea to continue its traditional role as the world’s testbed for emerging technologies. “I expect the Korean market can be a testbed for the crypto industry,” he says. “By the end of the year, every smartphone in Korea will have a crypto wallet.”
“In the early 3G era, Korea was a testbed for mobile services because of high-speed HSDPA and high smartphone penetration,” he adds. “So I am expecting the crypto user infrastructure will be set up by real adoption next year.”Â
Lee looked at 2019 from a more business-focused perspective. He predicted a return of interest in blockchain in Japan. He also thinks the industry will become more institutional and financialized than ever before. He adds, “We’ll start seeing M&As in volume.”
Gaming and finance
The three looked at which industries would be most impacted by blockchain in the coming year. Lee pointed to three sectors: digitized assets such as loyalty points and local currency, digital identity and financial items such as custody and wallets.Â
Kim, on the other hand, pointed to an old favorite of new technologies – gaming. “Games, including gambling, are always a good bet,” said Kim. “I also see a positive impact from the government.”
Oh predicted a similar trajectory for blockchain – gaming and advertising first, with e-commerce coming later. Like Lee, though, he also pointed to the financial sector. “Crypto was originally based on the finance industry, and crypto has already been recognized as a good alternative investment asset,” he says. “So institutional investors are waiting for the right channel to deal with their money, a channel that has to meet the very high standards of existing financial institutions.”
Plunging ahead in the bear market
Though the Great Crypto Meltdown of 2018 has forced the three to adjust their expectations a bit, they’re not letting the bear market get them down.
“Of course, we had to scale back some business initiatives like everyone else,” says Kim. “But, on the technology front, we will continue shipping codes.”
Lee emphasizes that business continues (mostly) as usual amidst the market downturn. He says, “Obviously recent crypto plunges had some impact but our focus remains the same: 1) introducing, developing, enhancing, and spreading ICON network and technology, 2) helping enterprises adopt blockchain technologies, and 3) implementing interoperability between the two.” Some companies and projects may stop developing or die completely in 2019, while others may need to tighten their belt. “Those that continue to deliver will survive,” he says. “ICON is trying to do a lot (i.e. public + private), but our work will lay the foundational work for future transformation.”
At Deblock, Oh is trying to lead the bear by the snout. “Market sentiment is always very important,” he says. “So Deblock is trying to lead market trends.”
The ICO is dead, long live the ICO
Though many in the blockchain space say ICOs are dead, Kim, Lee and Oh believe talk of the ICO’s demise may be premature.
“The ICO was one way to raise money for projects,” says Oh “2017-2018 was the first time to learn how to do ICOs, and founders and investors learned the pros and cons.” He thinks it’s time to perfect the ICO and regain public trust. He says, “I don’t think all ICOs are dead, but we must make up for the previous mistakes.”
Lee thinks we’ll continue to see ICOs – or similar types of token-offering fundraising mechanisms – in 2019, though not as often as we did in the previous two years.
But he warns, “If you choose to , you will need to answer two questions: 1) why is your company valued at $$$, and 2) why do you need tokens?” He adds that STOs are interesting, though people will need to consider what’s really STO-able.
Kim says though ICOs may be dead in the United States and some other countries, they’ll flourish elsewhere. He says, “ have come back stronger than ever in a more mature fashion because have not changed the fact that ICOs are an effective way for entrepreneurs to raise capital.”
Another year to mature and grow
Above all, 2019 will be a year of growth.
“2018 was the year to announce Deblock to the world,” says Oh. “We’ve accelerated several projects so far. And we are trying to expand our business to develop the Korean blockchain industry.”
“We plan to increase equity investment in early stage blockchain startups,” he says. “And advisory services will be expanded to STO projects as well.”
Kim says the coming year will separate the wheat from the chaff. “2019 means another year for the blockchain industry to mature,” he says. “We will begin to see the bad projects fail while the good projects rise and clearly differentiate themselves from the pack.”
