The crypto outlook for 2020 from a political-economic perspective: lots of light, lots of shadow

The effects of the economic and political events of 2020 could have a lasting impact on the future of crypto assets – even if the end result is unclear.

Most people are probably aware of the massive potential impact cryptocurrencies and blockchain technology can have on countless industries. Their ability to revolutionize the world is recognized even by those who don’t want them to develop – albeit reluctantly.

However, one should not forget that this revolution is a double-edged sword and can also counteract the current status of crypto assets.

With the new year just around the corner, it is worth considering how political and economic events will affect digital currencies.
A look back at 2019

Shortly before 2019, many thought it would be a breakthrough year. While it is true that some important milestones have been reached and significant successes have been achieved, the effects of the political and economic events have not helped the crypto world as much as some people had hoped.

The global economy was tough, Brexit was a very hot topic this year, and the US-China trade war raged for many months. Nevertheless, the stock markets managed to recover much of the lost value and traditional investments saw an increase in investment activity.

However, this has had a significant impact on the global economy, which has experienced a significant slowdown this year, mainly due to the situation between China and the United States.

The final result? Crypto assets grew stronger than in 2018.


What can you expect from crypto in 2020?

So far, everything that concerns 2020 and the following years remains pure speculation. However, it is likely that interest rates will remain low at the beginning of the new year. In other words, investors are likely to continue to look for better non-deposit earning opportunities. This could be an opportunity for virtual currencies.

As Glen Goodman comments: Bitcoin no longer makes as much noise as usual, but blockchain continues to be taken over by companies – just silently in the background, which creates the conditions for cryptography.

Meanwhile, Eugenio Aleman, economist at Wells Fargo Bank, believes that the recession of the world’s largest economy – the United States – remains an option. This, along with the UN warning of a global recession, could lead to an even greater economic slowdown and push people deeper into the crypto space.

Brexit did not have a noticeable impact on crypto in 2019, but it could still happen in 2020. A lot remains uncertain, which leaves a lot of options open. It is also unclear what the trade wars and military tensions will do – but many expect them to continue to be a major problem to address in 2020.

The United States is in conflict with China, North Korea, Iran and others. While armed conflicts with each of these countries remain highly unlikely, economic conflicts are expected and this could drive people further towards crypto.

At the same time, the national banks are developing an interest in cryptography, particularly in the CBDCs, led by China, Turkey and France. Russia is testing stablecoins, and many others are likely to follow.

All in all, it’s an unpredictable decade – with potentially big changes.