As we head into the holiday season all eyes are on the Bitcoin markets watching to see if another holiday rally to the moon materializes. It is looking rather unlikely with some large lots of BTC ready to hit the market in various auction sales and Mt. Gox settlement. At the same time of intense speculative attention, we have seen a growing volume of both stealth and non-stealth investments into Bitcoin-based startups specifically and blockchain technology startups more generally.

This is the dichotomous dilemma in front of us now, and it leads to a wide range of pundit opinions from the “Bitcoin is going to zero” crowd all the way to the “Bitcoin is going to replace fiat everywhere” crowd.

Stepping back from the speculative interest, however, it seems clear to me the next wave of market development will be centered around innovative applications of both the blockchain and the peer-to-peer networking platform coming out of the Bitcoin network and code base. The peer-to-peer infrastructure is one aspect that I believe is under-appreciated as all of the focus has seemed to be on applications of the blockchain specifically, but it is an aspect that should not be ignored.

IBM has already come out talking about applying the Ethereum software to solutions in the “Internet of Things” (IoT) space. Beyond that, there is a wide range of domains where the application of Bitcoin-derived technology has yet to be explored.

As a start, anything that is cloud based and traditionally SaaS oriented could see migrations to decentralized peer-to-peer technology in some form. For some domains like customer relationship management the suitability may be debatable. For other areas, like decentralized grid computing or self-organizing systems of “things”, decentralized peer-to-peer blockchain technology can provide a force multiplier in accelerated development and deployment; allowing us to stand up interesting self-coordinating systems solving problems that possess complexity either due to technical reasons or because simplicity on the surface becomes complex due to scale and scope.

For startups, leveraging the decentralized peer-to-peer platform can drive down infrastructure expenses and solve scalability challenges, while providing an economic incentive for participation of the user base through network protocol enforced fees and rewards.

Areas where I see disruptive innovation emerging in 2015 include:

Digital advertising networks, ad serving, optimization, stats tracking, and revenue sharing

News reporting and dissemination (Patch-on-the-blockchain)

Livestreaming

Geo-spatial systems

Medical Technology

Stream data processing

Artificial Intelligence

Gaming, console integration, and virtual reality systems

Note that I haven’t included “merchant adoption” and things oriented to “adoption” of Bitcoin as a currency. I personally believe any such notion is far off, and the market needs to get through another hype-driven price cycle before it trends towards $1-2 USD and stabilizes, trading in a range closer to fiat pairs in traditional forex. Before that occurs I do believe we will see at least one wilder rise in the speculative price of Bitcoin. Presently with most traders essentially gambling with 10x, 20x, and 50x leverage on Chinese Bitcoin exchanges, the focus is still solidly on the speculative aspect of Bitcoin. It will be many years before we see stabilization in Bitcoin specifically. In the meantime, however, those with a longer term view on the technology markets in general – e.g., “smart money” – will be positioning themselves and making bets on more strategic plays on applications of the technology outside of Bitcoin. I believe we will see growth in this area accelerate throughout 2015 and into the next several years.

What will drive the next hype-driven price cycle in Bitcoin will be publicity surrounding these wider areas of innovation, as those innovative solutions “touch” a wider range of consumers more directly and drive increased awareness, which will drive a wider range of interested parties to jump in and grab a few Bitcoins simply to not miss the bandwagon.

What we will also see, in my opinion, is a more mature spectrum of offerings in the “alt coin” markets – alternative crypto currency implementations derived from the Bitcoin protocol specification and code base. The explosion of “clone coins” with little technical, economic or other market advantages to offer seems to have reached its nexus (e.g. so-called “cargo cult” coins) and the market is adjusting in kind. 2015 will see more professional and mature “alt-coins” hitting the market, and old and forgotten alt-coins that were “firsts” in some way returning to top-of-mind.

As a shameless plug, you can get involved with an innovative project for 2015 by participating in the Sapience AIFX crowd fund at http://crowdfund.blockchainsingularity.com. This is an initiative to leverage the decentralized peer-to-peer coin network and Bitcoin-derived protocol to support a high-performance distributed artificial intelligence platform with applications across a wide range of problem sets. The first reference application will be in support of algorithmic AI trading tools in Quotient ($XQN), an interest-bearing proof-of-stake crypto currency.