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Executive summary

We have expressed the conclusions step by step, but to write in a few sentences the main points to retain from this study:
Regulations fears have eased but will come back, especially as G20 will work on concrete proposals from July on. Especially, ICOs will obtain frameworks, and KYC issues will continue to focus on requirements from officials.
There is clear technical progress, especially in terms of governance, scalability, with competition in the nature of solutions; next months will be technically very interesting

Individuals may not be keen to pour more cash into cryptos at it shall first stabilize and recover; banks and funds look to be cautious towards cryptos, not taking the relay. Ultimately, the global economic situation as it may evolve on its own will probably be the parameter with the most impact on DLT tokens valuations.

Ultimately, from an investment perspective, the next 12-18 months may be expected to offer limited or disappointing growth in DLT tokens; we may witness ups and downs maybe even more severe than the ones already experienced in 2018 already, with occasional rallies.



Section 1: Blockchain Global Market Updates

As 2019 began, observers and actors could only sum up the past year as a “crash” or “worst year ever in crypto.” The bear market that was seen as early
as mid-January 2018 and confirmed in February has proved to be a strong trend that is not yet finished, as there are no signs of a recovery in the crypto
markets in early 2019.

Despite this, the demand for tech people involved in DLTs remains strong (see comment on “Blockchain talent” page 13). Over the course of the previous twelve months, a lot of people that had entered by chance, perhaps attracted by the hype, have lost their enthusiasm, or have drifted elsewhere. Nowadays, fewer amateur and inaccurate articles are found on the web. Only the knowledgeable and the serious enough have remained.​

Read more in the full section on Global Market Updates.

Section 2: Update on crypto regulatory policies

The worldwide financial stability has confirmed the view that cryptocurrencies do not threaten the global economy. Arguably, the crypto sphere is too small, even more so now that the total market cap is back in the region of 100 billion dollars.

At the World Economic Forum gathering in Davos in 2018, the comments around crypto-assets and bitcoin were skeptical, but not completely closed to the emerging technology. This year, round tables and debates on blockchain were again held, and Davos participants have chosen sides. A lot of opposing views were expressed, and crypto-asset valuations were heavily criticized.

Read more in the full section on Update on regulatory policies

Section 3: Review of blockchain industry players

Demand from ventures that issued an ICO for listing on the main exchanges (Binance, Huobi, OKEx, Kraken, etc.) is high. On the one hand, the benefits for
projects that are listed on one of the main exchanges are significant, in terms of recognition, exposure, and access to liquidity. On the other hand, one of the
business objectives of exchanges is to offer a maximum number of interesting tokens that they are confident will create a market that is active enough.

Hence, some exchanges have implemented admission processes, including token information disclosure requirements. ICO details and success
criteria are often analyzed by the exchanges as a proxy for evaluating the attractiveness of tokens.

Some exchanges, such as Coinbase, have begun proposing a custodian service; holding and securing crypto- assets for its clients.

Read more in the full section on Review of blockchain industry players.

Section 4: Investment and use case by industry

According to IDC (International Data Corporation), spending on blockchain is projected to continue growing exponentially, increasing from 0.8 billion USD in 2017 to 1.5 billion in 2018, to reach 12 billion in 2022. The US and then Europe will account for the largest spending, followed by China and Japan. In the same study, spending will be led by the financial sector. Manufacturing and retail sectors are also reported to be increasing their investment by 82 percent annually.

What this says, at the very least, is that corporations have not been deterred from continuing to invest in the technology and the development of related applications.

Start-ups also continue to receive funding. However, regardless of the current dynamic of ICOs, there is an important phenomenon related to ICOs issued in 2017 and early 2018: funds were raised in cryptocurrencies (BTC, ETH, etc.), and if the teams have not converted or hedged these financial positions, they are now sitting on one fifth to one tenth of their initial capital. While this hedging and spending on development has no doubt placed downward pressure on crypto markets, the actual funding of these initiatives must now be problematic for their executives.

Read more in the full section on Investment and use case by industry.

Section 5: Trend By Crypto-Assets Class

Cryptocurrencies are now more than ever all linked to bitcoin, so it is worth focusing on BTC to check the overall health of the sector and the likelihood of a trend reversal.

Bitcoin is incrementally claiming back the ground it lost to the emergence of altcoins throughout 2017. Its predominance had fallen as low as 30% and is now back to 55%. There are no indications that it will not continue to regain lost ground, and it is worth examining why.

Read more in the full section on Trend by crypto-asset class.

Section 6: Latest Advancement In DLT Technology

It is still not clear which solutions will ultimately win widespread adoption, as far as scalability of the various current DLT alternatives is concerned. Some refinements appear to be gaining momentum, such as the MimbleWimble protocol, and zkSTARKs that are poised to replace zk-SNARKs. Also, DAGs seem to have received insufficient exposure up to now; but only time will tell which of these technical solutions will earn dominant implementation. As the example of Facebook shows, it is not always the best technical solution that achieves a monopoly.

Read more in the full section on Latest advancement in DLT technology.

Section 7: Overview by country

The following section offers a collection of updates summarizing private and official positions towards blockchains in different countries and geographical areas.

Read more in the full section on Blockchain regulation overview by country.