The buzz around cryptocurrencies is booming and accelerating more quickly than ever, with more major media outlets covering new developments every day. With daily exposure in nearly every major newspaper and television station, it is clear that cryptocurrency is fast becoming mainstream. Not only is the discussion growing larger, but the market capitalization and trading volumes are sky-rocketing at an exponential rate.
On January 1, 2017, roughly a year ago, the market capitalization of all cryptocurrencies was recorded at US$17 billion, with 24-hour global trading volumes peaking at US$292 million. On December 31, 2017, the market cap reached US$610 billion and a 24-hour trading volume of US$33 billion, an increase of 3588% in market cap and over 10000% increase in trading volume in only one year! To put these numbers into perspective, this is the equivalent of Whatsapp (worth US$19 billion) growing its market capitalization to the size of tech powerhouse Apple (worth over US$700 billion). At the current rate of growth, the cryptocurrency market could overtake the market capitalization of every company listed on the Dow Jones by April 2018.
Although this boom creates an amazing opportunity for traders and startup projects, it also uncovers challenges to the cryptocurrency exchange infrastructure that supports them. Frequent outages and trading delays are being seen on exchanges unprepared to deal with swarms of new users, sometimes reaching over 100,000 per day. Trading platforms are also under constant attack from hackers, experience stolen funds, and lack policy transparency, eroding the trust of their users. Just in July of 2017, over US$50 million worth of stolen cryptocurrency was reported, and it can be assumed that that number does not include unreported thefts that may be occurring daily.
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