2018 proved to be a tough year for the cryptocurrency markets, with many altcoins dropping 90% or more. Despite this, there was a significant amount of development that occurred in the industry, which could mean that 2019 will prove to be a much better year for the markets.

Around this time last year, the cryptocurrency market capitalization rose to highs of over $800 billion, from which it dropped nearly 90% to lows of $100 billion. This drop first began when Bitcoin failed to maintain its upwards momentum in December of 2017, dropping after it touched $20,000.

Cryptocurrencies Start the New Year Off Trading Down

Although the markets failed to meet the expectations of many investors and analysts who had lofty predictions for where the markets would end 2018, they kicked off the New Year trading down slightly.

At the time of writing, Bitcoin (BTC) is trading down 1.5% at its current price of $3,740, down from its weekly highs of nearly $4,000. This has been a relatively volatile week for Bitcoin, which dropped last Thursday to lows of $3,600 before climbing back to its highs of $4,000 then drifting back down to its current levels.

XRP is trading down under 1% at its current price of $0.355. XRP is currently down over 11% from its weekly highs of nearly $0.40.

Ethereum (ETH) is closely following Bitcoin’s price action and is currently trading down 1.4% at $135.

Could 2019 Gains be Driven by Institutional Adoption?

Throughout 2018 the cryptocurrency markets saw several examples of institutional groups and corporations entering the cryptocurrency markets, with Bakkt announcing their institutional-aimed Bitcoin derivatives product, and Fidelity Investments announcing their plans to release a similar product.

Brad Garlinghouse, the CEO of Ripple, spoke about how he thinks the markets will fare in 2019 at the SG FinTech Festival, bullishly saying that he believes more traditional banks will invest money into cryptocurrency projects.

Garlinghouse’s sentiment was echoed by Samantha Albright, the head of business development at FXM Capital, who said that “Banks in 2019 will likely invest much more money into cryptocurrency projects.”

Through a partnership with the NYSE-parent company, ICE, major corporations like Starbucks and Microsoft have also entered the crypto markets, with the aim of creating a seamless global payment network.

It is important to note that these companies will not be initially allowing customers to pay for products with crypto, as many headlines claimed, and rather are working with an exchange that will convert Bitcoin to USD that can then be used to pay for items.

Starbucks clarified this in a statement, saying:

“It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks… Customers will not be able to pay for Frappuccinos with bitcoin.”

As more institutions and corporations enter the cryptocurrency markets this year, it is plausible that cryptocurrency prices will rise as sentiment grows and as more retail investors enter the nascent markets.

All the cryptocurrencies mentioned in this article are available to trade on covesting.io