BTC is coming to the conclusion of one of the leading years in its short history.
The bitcoin price has surged through 2020, reclaiming its 2017 all-time highs after finding support from Wall Street and several of the world’s biggest investors.
At this point, with the bitcoin as well as cryptocurrency group looking ahead to a slew of developments in 2021 – including the much anticipated launch of Facebook’s bitcoin-inspired cryptocurrency and potentially industry-defining U.S. cryptocurrency regulations – Wall Street huge Wells Fargo WFC +1.5 % has said it expects to be “discussing the digital asset area more” next year.
“Over the past 12 years, [bitcoin and cryptocurrencies] have risen from literally nothing to $560 billion in market capitalization,” John LaForge, head of real asset strategy at Wells Fargo, wrote in an investment strategy report this week.
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LaForge pointed to bitcoin’s 170 % gain this year – “that’s along with the ninety % gain it had in 2019” – naming cryptocurrency investing as “a bit like living in the first days of the 1850’s gold rush, which involved more speculating than investing.”
As well as speculative interest from traditional investors, bitcoin and cryptocurrencies have noticed a surge in take up from the likes of payments giants PayPal and Square this season – one thing that’s anticipated to have a direct impact in 2021.
“2021 really centers around continual developments 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 via crypto. There’s a lot of such use cases for crypto, and then we expect these to expand rapidly in the coming year. Trading will still be reflective of this adoption curve; the higher the adoption, the more bullish the entire trading mix is going to be, that is a bullish base case for the main crypto assets.”
Bitcoin‘s volatility took “center stage” this year 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 is “almost impossible to pass around the’ Summer of DeFi,’ which echoed the primary coin offering (ICO) boom back in 2017.”
Ethereum, the world’s second largest cryptocurrency by value after bitcoin, has soared by 300 % over the past twelve months amid a flurry of interest in decentralized finance (DeFi) – utilizing crypto know-how to recreate traditional monetary instruments like insurance as well as loans with many DeFi tasks built along with the ethereum network.
“From the trading perspective, virtually all of the year’s focus has been on yield and structured items, we’ve noticed a tremendous trend of futures goods as well as alternatives items come to market, and it’s likely more will follow soon,” Crosby said.
“We have noticed some of the’ edge case’ crypto-assets become mainstream as well, which should remain in the new year.”