How STO Will Attract $4 Trln To The Crypto Market By 2020

Blockchain Conference Moscow took place under the more than ever high emotions in connection with the BTC nosedive and other significant events like BCH hardfork and hashwar, which the whole community is talking about. But the worries did not prevent representatives from different sectors of the crypto market to sum up the interim results of the year and to determine the current and future trends, including two stable currents. First, investors are increasingly choosing startups that want to get the maximum licensing of their activities. And second: ICO continues to lose its appeal, and STO - to gain popularity.

The first part of the day was quite calm: experienced traders told how they earn in cold blood on panic sells, and unwearying miners explained why they invest in new equipment and how to produce coins cheaper. So, although bitcoin had depreciated, the world didn't fall apart.

According to our expert from South Korea, banker and blockchain & fintech evangelist Gareth BARKER, “the bear market will continue into Q1 2019, while bitcoin will continue trading “sideways””. Technical analysis of the expert suggests that beginning from the second quarter of the next year there will be a steady growth of bitcoin, and there is a reason to think that by the end of 2019 it will grow to $15,000. ”There are more long term traders in the market holding onto digital assets, not just bitcoin but other altcoins, that are waiting for the bear markets to clear", - Gareth BARKER said.

Almost every speaker shared the current trends, as it’s customary at conferences. But not all of them were ready to make any predictions. Co-founder of the German company developing decentralized protocols Sandris MURINS noted several the most likely scenarios for the development of the market: investment banks will strive to create security-tokens, and exchanges - to issue their own derivatives. The expert also believes that large financial institutions will tend to integrate, and among crypto and blockchain companies there will be a general decentralization, which will form the basis of trust for regulators.

However, at the conference, not everyone was inclined to consider interaction with the regulator and government agencies as a benefit. The author of books about ICO and the founder of the blockchain company Vladimir POPOV believes that “bitcoin is a digital freedom, and the state blockchain is an innovative slavery”. “Recently I was in China, so there is no longer possible to enter certain metro stations in rush hours without permission, all your movements and your life are controlled,” - says the expert.

Speakers often raised the issues of scam and ICO capitalization in their reports, but the most attention was paid to the new trend - STO. In fact, this trend appeared as a demand of investors, since unlike the ICO, the requirements for the security token are much higher: the AML and KYC systems are must have, as well as listing on a licensed exchange. According to the founder of the international law firm Dmitry MACHIKHIN, investors no longer manage with such projects that don’t have a strong legal basis. "NASDAQ analysts predict that STO will become the most popular tool for raising funds in the fintech sector in 2019 and it will reach $4 trillion of the market capitalization in 2020. And the most relevant for tokenization will be the securities and land markets," - the expert is convinced.

In addition to crypto trends, there were the developments in the field of blockchain actively discussed - from the introduction of technology into the voting or education system to smart contracts. According to Deloitte, 43% of companies included the analysis of blockchain application prospects in the TOP 5 priorities, 29% are already in one of the blockchain consortium and 45% are going to join one of the existing blockchain networks within the next year.

In view of the existence of various options for private and hybrid blockchain, where you can hide data from user groups, many of the speakers opposed such variations of distributed registries. The technical specialist of the innovative company Yevgeny RADCHENKO in his report on innovations in the field of smart contracts for IoT, said, “If there is no trustless in the blockchain, then it’s not a blockchain.”

The panel discussion continued with the topics of blockchain and cryptocurrency regulation, the participants paid special attention to the problems of regulation and overcoming obstacles that are created by legislative framework. The experts taking part in the discussion agreed that it is almost impossible to become a successful project without legal assistance, since there is now a completely different legislative understanding of securities and security tokens in all countries. In the ever-changing regulatory landscape, new laws are constantly coming out leading to the cross-legal issues arising.

However, it is unreasonable to avoid regulation: according to a member of the Moscow bar Association Maria AGRANOVSKAYA, "Now there is a significant consolidation of the market, and players who don’t enter the legal field and avoid receiving the proper licensing, simply lose their chances to enter the market." And an expert on international, financial and corporate law Maxim PERVUNIN summed up the discussion: “Registration of a security token or licensing is not an easy process, and we need lawyers to find the necessary legal enforcement solution for each unique case."