Cryptocurrency enthusiasts entered 2018 full of hope for the future. Bitcoin and other cryptos were reaching new all-time highs; cryptocurrencies were a regular feature in mainstream news; and there was no indication that the ride was slowing down.

Needless to say, 2018 has not been what the community hoped it would be. Rather than a continued period of growth and prosperity, the year has been a grueling 9-month decline, with the crypto market losing about two-thirds of its total value since January. The market has stemmed the bleeding in recent months, but many crypto enthusiasts are left wondering if the 2017 days of explosive growth will ever return.

While I won’t make any promises about a return to 2017-level growth, I believe there are plenty of reasons to be optimistic about the future of cryptocurrencies. Here are five of them:

1. The market has stabilized

Though many cryptocurrency enthusiasts are unlikely to be satisfied with stable prices, stability is a positive change compared to the inexorable decline experienced throughout 2018. Bitcoin in particular—barring the dip and resurgence last week—has had a significantly more stable price in recent weeks than at most other points in its 9-year history.

Stability in the crypto market should be a source of optimism for three reasons. First, it’s possible that the market has ‘bottomed’, meaning there is nowhere left to go but up. Of course, this is not guaranteed to be the case, but it seems likely that many of the most bearish crypto investors have already exited the space.

Second, it’s important to remember that price increases are not necessary for cryptocurrencies to succeed. Yes, it would be fantastic if the crypto market launched ‘to the moon’, but this is by no means essential for cryptocurrencies to accomplish their desired goals.

Finally, although the cryptocurrency market is no where near its peak value, the prices of most coins are still significantly higher than they were this time last year. Bitcoin, for example, was hovering at around $4,500 in early October 2017, about 30% lower than its price today. From this perspective, the cryptocurrency market appears to be in a very healthy place.

Price stability certainly isn’t as sexy as price gains, but at the very least, stability gives more time for the developers of cryptocurrency projects to continue refining their products—which brings me to my next point.

2. The problems are clear, but so are the solutions

Though it might seem counterintuitive for an article focused on optimism to spend time discussing problems, I feel in the case of cryptocurrencies that it is important to be honest about where the technology is and where it is going. Famed GE inventor Charles Kettering once said, “A problem well-stated is half-solved,” and cryptocurrency developers (along with the larger crypto community) have done an excellent job of diagnosing the current problems in cryptocurrency and coming up with possible solutions to them.

Most of the problems in cryptocurrency can be condensed into two broad categories: scalability and adoption. These are clearly-defined areas for improvement in the cryptocurrency industry that have both seen significant developments over the course of 2018.

Scalability

Scalability refers to the potential for blockchain platforms to sufficiently scale for mainstream use. Bitcoin and other cryptocurrencies famously perform at much lower transactions per second (TPS) than traditional payment systems like VISA. Increasing transaction speed is therefore a critical part of ensuring blockchain platforms are able to reach their full potential. Thankfully, the developers of many of the most promising cryptocurrencies are hard at work creating scalability solutions.

Bitcoin and Litecoin developers, for example, are working to integrate a second-layer scaling solution called the Lightning Network, which is expected to facilitate near-instant transactions with minimal fees. Ethereum, on the other hand, is using a strategy called sharding, which involves splitting the Ethereum blockchain into many smaller blockchains that can process transactions in parallel. Rocket Pool estimates that sharding, once fully implemented, could facilitate up to 15,000 TPS.

Though the Lightning Network and sharding are still works in progress, the fact that they are being prioritized so heavily by their respective developers should inspire hope among cryptocurrency enthusiasts that these networks will be able to overcome their current scalability shortcomings.

Adoption

The other key area for improvement in the cryptocurrency industry is adoption: increasing the number of people around the world investing in and using cryptocurrencies. Solutions to the adoption problem have been abundant throughout 2018. Cryptocurrency futures, possible Bitcoin ETFs, and the increasing number of payment apps that accept cryptocurrencies are all good signs for the future with regard to user adoption.

The greatest adoption tool, however, will likely be the increased media attention cryptocurrencies will receive should the bear market ever turn bullish once again. Adoption is a positive feedback loop: the value of Bitcoin and other cryptocurrencies is determined by the prices people are willing to pay for them. Increased adoption will likely bring with it market growth, which will lead to further adoption.

3. Favorable regulatory decisions (so far)

The SEC indicated earlier this year that Bitcoin, Ethereum, and a handful of other cryptocurrencies will not be regulated as securities. This is good news for the above coins—though it does leave many other coins in more uncertain predicaments. Initial coin offerings (ICOs), for example, are very likely to be regulated as securities, which is at least partly to blame for the crash of the ICO market (ICO’s have raised significantly less capital this year compared to this time in 2017).

But many in the cryptocurrency community have had mixed feelings about ICOs for some time. ICOs have been criticized heavily because many of them have been revealed to be outright scams. A recent report out of Boston College suggests that over half of ICO projects fail to survive more than four months after the ICO ends. For this reason, stricter regulations on ICOs may in fact be a good thing for the cryptocurrency market as a whole.

4. Successful platform launches

2018 has also seen the successful launch of several major cryptocurrency platforms, including fifth-ranked coin EOS and 13th-ranked TRON, both of which launched their mainnets in June of this year.

Both EOS and TRON are broad-use blockchains that allow developers to create decentralized applications, also called ‘dapps’. EOS launched its mainnet on June 14 and has since become the third-most active blockchain in the world. The EOS platform is also noteworthy because it is capable of significantly more transactions per second than many earlier blockchains—nearly 4000 TPS to be precise.

TRON also successfully launched its mainnet in June of this year. While the platform has not yet amassed the user count that EOS has been able to achieve, the launch has been accompanied by a slew of project announcements and acquisitions, indicating that the TRON network still has significant room to grow.

The launches of the above platforms are cause for optimism for a variety of reasons, the most obvious being that they were successful. Beyond the obvious, however, these launches also serve as an important reminder that many of the largest and most valuable blockchain projects are still in their very early development stages—which brings me to my final point.

5. Cryptocurrencies are still young

The biggest reason for optimism in the cryptocurrency market is that cryptocurrencies are still very, very young. These are advanced technologies that require an unbelievable amount of work to develop. Making things more difficult, many cryptocurrency projects are in completely uncharted territory—having to come up with practical solutions to problems that have never been solved before.

I think that cryptocurrency’s volatility has done the community a disservice; the daily price movements have distracted many from the long-term goals that these projects are trying to achieve. The development timelines for cryptocurrencies are not days or months, but years. Keeping this in mind is absolutely critical and makes optimism about the cryptocurrency market that much easier.

Conclusion

So there you have it: five reasons for remaining optimistic about the cryptocurrency market despite the 2018 decline.

The market has cooled off; there’s no denying that. Whether or not this is a temporary slowdown or an indication of newfound stability is impossible to say. But with the above points, I hope that you can learn to appreciate the stability; appreciate the time that it affords developers to continue refining their platforms; appreciate the fact that cryptocurrencies and the blockchain have kickstarted a technological revolution that is still in its infancy—and be thankful that you have a front-row seat to watch it take place.

Disclaimer:  The author of this article owns a small holding in various cryptocurrencies, including Bitcoin. The information in this article is based upon current available data and the author’s views as of October 18, 2018, all of which are accordingly subject to change. The above article should not be considered investment advice. Any such advice or opinions should be sought by an independent, third-party expert over such matters.

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