Home Cryptocurrencies News How The Pandemic Is Stimulating Innovation In Crypto

How The Pandemic Is Stimulating Innovation In Crypto

How The Pandemic Is Stimulating Innovation In Crypto

2020 has brought with it a sense of uncertainty across asset classes, cryptocurrency included. 

Though the major cryptocurrencies like bitcoin and ether initially fell during the onset of the pandemic, they have since recovered their losses. Going forward, it seems possible that many investors will the pandemic as a net positive for crypto, as more family offices and private individuals could seek digital assets as a way to protect against inflation risk.

DBS chief economist Taimur Baig believes 2020 is “shaping up to be a landmark in the history of digital finance,” and cryptocurrency is here to stay. According to Baig, public and private digital currencies “remain brave new frontiers, with new use cases, technological developments, and challenges appearing regularly.” 

The growing demand is encouraging innovation. iCoinSoft, one of the first U.S. blockchain software developers, has been providing technology for e-commerce and crypto exchanges since 2017, but the company is now working on a new solution for startups and smaller businesses planning to integrate cryptocurrencies.  

iCoinSoft CEO Aleksandr Iurev believes cryptocurrencies are finally becoming mainstream. 

“Now, when the ICO race is over, the digital finance market is more predictable,” said Iurev, who has been working on democratizing access to cryptocurrency exchanges across the world. “The crypto market needed a new type of investor, and the pandemic pushed people to look more towards crypto assets.” 

Businesses Adapting To Cryptocurrencies  

In July, Visa Inc (NYSE: V) announced it has been working closely with digital currency platforms to provide a bridge between digital currencies and their existing global network of 61 million merchants. Mastercard (NYSE: MA), too, is expanding its cryptocurrency program. 

Companies such as Robinhood, Square Inc (NYSE: SQ), and Revolt have been operating in the cryptocurrency space for years. In its recent earnings report, Square reported that its Cash App had generated $306 million in bitcoin revenue. 

Previously shunned by many in the mainstream financial world, cryptocurrency is now being integrated into the business model of leading companies. At the end of September, a letter by the Office of the Comptroller of the Currency (OCC) set out to clarify the legal position on financial institutions, such as banks and savings associations that are seeking to offer cryptocurrency savings.

The letter was written in response to the growing demand for these products and clarified that the law must be adhered to in the process of offering these services. According to the OCC, banks and other service providers must increasingly learn to leverage new technologies and innovative ways to serve customer needs.

What’s Next For Crypto Investors? 

Until recently, in the absence of clear regulations, choosing the best and most secure exchange was up to crypto investors. Developers of crypto exchanges are using different approaches and programming languages that sometimes have a crucial impact on overall security and speed. 

Iurev of iCoinSoft prefers a compiled approach, similar to the one used by NASDAQ and other traditional stock exchanges. “We chose the compiled programming languages, because it allows executing orders in a fraction of a second,” said Iurev. Those exchanges built on interpreted programming languages are normally tens or even hundreds of times slower. 

Soon, a new legal framework could stimulate the development of crypto exchanges. Two new bills introduced in Congress in September — the Securities Clarity Act and the Digital Commodity Exchange Act — could finally offer more clarity and protection for users of digital commodities.  

Disclaimer: The author of this post does not hold any public or private positions in any of the companies mentioned. The companies sourced in this article were selected by various public sources, recommendations, and word of mouth. Please consult your financial advisor before investing in any cryptocurrencies, stocks, or companies as they can pose risks for the average investor. This post is informational in nature and does not constitute financial advice. 

© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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