Here's my analysis of why cryptocurrencies are on the path to victory.
We're in a transition stage now, where doubters still have traction and an outsized effect on the market. Give it time, and cryptocurrencies are going to crush it. This isn't a new pitch, after the price boom, but I usually here it argued one way (Federal Reserve Bank, less meddling, etc.). This is a different, more market-based take on why it's inevitable.
One of the leading indicators is: how widely is it used among college and university students?
That's important, because that's showing you, what's the next generation going to be comfortable with and using on a "first name" basis. For a while it was Internet, and while it took some time for the stigma of porn to wear off, we're now all accustomed to names like Google, Facebook, Amazon, etc. They're companies our society pretty much can't function without.
Cryptocurrencies are in that stage now. It's going to take a while for non-cryptocurrency users to phase out of the professions, and for their cryptocurrency-using replacements to come in. But even at the slowest rate, of retirement at one end and college graduate hiring at the other end, success is coming.
Part of it is the risk-reward ratio for cryptocurrencies, as opposed to other markets in its space. It's a lot faster and easier to monetize them than many other products. That's ultimately going to exert a gravitational pull, and bring in the best professionals from fields like marketing and product, who are working for Hollywood or Apple right now.
It's also cultural - something that purely technology-based assessments miss. People have to be acclimatized to this idea that you can use a digital coin for buying and selling, that it's OK, that you can not hold cash and not be a weirdo. It's happening slowly, but it's happening. Ethereum is mentioned on Silicon Valley, and that gets mentioned in the NYTimes; but a time is coming when every TV show has a cryptocurrency subplot, then a regular cast member who gets paid in cryptocurrency on the regular. It's early now, but you can see the first signs.
A different way of thinking about it is as a natural evolution of the technology market itself.
If you've worked in tech or as a developer, you've heard of API's. It stands for Application Programming Interface, and - simplifying a lot - it's a programmable plain-text way to get information in the most low-overhead way imaginable. There's an API behind most every website you read: the "front end" makes it look beautiful and snazzy enough for you to want to use it, but the "back end" amounts to API's that supply the necessary information in bare bones form, before it gets marked up and shipped out.
A lot of websites started out as nothing but nice faceplates over API's. Two examples are: DropBox, which used an API to store things in Amazon Web Service's S3 storage system, and Mint, which used an API to fetch its information from Yodlee. (The latter example is especially interesting, since Mint got rich off this relationship and Yodlee, which was absolutely necessary in the early stages for Mint to work, got squat).
A cryptocurrency can be seen as a monetized API. Rather than slap a price on the usage of the API per request, you instead make a "piece" of the API itself what you sell; so that when it's more used, more valuable, your users - now, transformed into investors - make more. And that incentivizes more people to buy in, and that creates a network effect, and that incentives more people to buy in, which strengthens the network effect, etc.
And that's key to their eventual win. What makes cryptocurrencies different from almost everything before it is: now, not only can you participate in the market, you can grow with it, with your wealth. Not in the indirect "in 20 years" profit of the stock market, but on a shorter timeframe - like, now. That gives a massive word-of-mouth bonus that most products don't have. There are many products that I basically like, but I'm quiet about for the most part because I'm not invested in their success. With cryptocurrencies, it makes sense to explain why they're better: now it's in my own best interests to speak up and help move the market, not just the VC's and founders who have no material impact on me.
That's starting to shape the market, even now. For a lot of products, nobody outside the company much cares if they go up or down. When they're trending downwards, no one is out there communicating about their value outside the tiny fraction of the population that works there or has a stake (which is close to zero, pre-IPO). With cryptocurrencies, those defenders are distributed everywhere. When things slide downwards, they show up. They soften the crashes and strengthen the spikes. And they'll continue to be there and actually increase in number, as the market share of cryptocurrencies as a whole increases.
And then, some of the hardest nuts to crack will finally open. On Steemit, you can find posts of organizations you like and upvote them, to kick a little funding their way. Suddenly, microtransactions will be solved. You buy the currency because you post here, it's fun, and your cryptocurrencies are making a lot more for you than the US dollar will.
When the whole world is using cryptocurrencies and it's become boring to say that, all of the above will be priced in. They'll be safer, yes, but also that much more expensive. Now's a good time to enter, when there's still a question mark next to them, deflating prices. Remember that as the days turn into years, and cryptocurrencies continue on their way.