BTC is actually coming to the end of one of the leading years in its brief history.
The bitcoin price has surged through 2020, reclaiming its 2017 all-time highs after finding support from Wall Street and some of the world’s biggest investors.
At this point, with the bitcoin and cryptocurrency community looking forward to a slew of developments in 2021 – including the much anticipated launch of Facebook’s bitcoin inspired cryptocurrency and likely industry defining U.S. cryptocurrency laws – Wall Street huge Wells Fargo WFC +1.5 % has said it expects to be “discussing the digital resource room more” following year.
“Over the past 12 years, [bitcoin and cryptocurrencies] have risen from virtually nothing to $560 billion in market capitalization,” John LaForge, head of natural asset program at Wells Fargo, wrote in an investment strategy report this week.
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LaForge pointed to bitcoin’s 170 % gain this season – “that’s along with the 90 % gain it had in 2019” – naming cryptocurrency investing as “a bit like living in the original days of the 1850’s gold rush, which involved even more speculating than investing.”
And also speculative interest from traditional investors, bitcoin along with cryptocurrencies have noticed a surge in take up from the likes of payments giants PayPal and Square the year – one thing that is likely to have a direct impact in 2021.
“2021 actually centers around continual improvements in continuity between traditional marketplaces as well as crypto markets,” Pierce Crosby, general manager at financial details company TradingView, said via email.
“A best example would be Square’s SQ +4.9 % bitcoin offering or maybe PayPal’s PYPL +2.2 % payment by crypto. There are lots of such use cases for crypto, and then we expect these to grow quickly in the coming season. Trading will nonetheless be reflective of this particular adoption curve; the higher the adoption, the more bullish the overall trading blend will be, that is a bullish starting case for the major crypto assets.”
Bitcoin‘s volatility took “center stage” this season based on Crosby, with the bitcoin priced falling to lows of about $4,000 per bitcoin during the March coronavirus crash before sharply rebounding, but added it’s “almost impossible to pass around the’ Summer of DeFi,’ which echoed the initial coin offering (ICO) boom back in 2017.”
Ethereum, the world’s second largest cryptocurrency by value after bitcoin, has soared by 300 % during the last 12 months amid a flurry of interest in decentralized finance (DeFi) – using crypto expertise to recreate traditional financial instruments such as for instance loans and insurance with many DeFi projects built in addition to the ethereum network.
“From the trading perspective, majority of the year’s focus has been on yield and structured items, we’ve noticed a major wave of futures goods as well as choices products come to market, and it’s very likely more will follow soon,” Crosby said.
“We have observed some of the’ edge case’ crypto-assets be mainstream too, and this should continue in the new year.”