The landscape for cryptocurrencies is getting more complex not simpler. Complexity comes from the process of experimentation with how to employ blockchains and the development of new ways to enhance the usage of cryptocurrencies as a store of value and medium of change. Like many industries, growth will lead to winners and loser. There have been significant failures, hacking, and fraud. There has been significant adoption my many major corporations and new payments experimentation. There will be creative destruction as users and usage sort out how to best exploit this technology.
However, growth and maturity also lead to financial innovation and complexity on how to access, finance, and trade cryptocurrencies. Innovation will attempt to reduce the cost of trading and gaining exposure. Some of these developments are related to the regulatory environment. Innovation will also occur in an effort to reduce the cost of regulation and avoid market impediments for usage. At the same time, regulators will attempt to serve in a role of facilitating the common good through helping to form standards for usage to protect investors. The goals between investors and regulators should be aligned; however, in a rapidly changing market, regulator may be perceived as slow moving versus the crypto innovation crowd.
A simple financial map (from CAIA blog) for accessing crypto exposure shows the market broadening. There is direct, traditional, and futures markets available for investors; however, not all are the same and there exists inefficiencies in pricing across these marketplaces. Investors must focus on these cost and pricing differences.
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