BTC is actually 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 and cryptocurrency group looking ahead to a slew of improvements in 2021 – including the much anticipated launch of Facebook’s bitcoin inspired cryptocurrency and potentially industry defining U.S. cryptocurrency laws – Wall Street giant Wells Fargo WFC +1.5 % has said it expects to be “discussing the digital resource space more” next year.
“Over the previous twelve years, [bitcoin & cryptocurrencies] have risen from literally nothing to $560 billion in market capitalization,” John LaForge, head of natural 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 season – “that’s on top of the ninety % 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 more speculating over investing.”
And speculative interest from regular investors, bitcoin along with cryptocurrencies have seen a surge in take-up from the likes of payments giants PayPal and Square this season – something that is likely to have a direct effect in 2021.
“2021 actually centers around continual improvements in continuity between regular marketplaces as well as crypto markets,” Pierce Crosby, general manager at financial data company TradingView, said via email.
“A perfect example would be Square’s SQ +4.9 % bitcoin offering or maybe PayPal’s PYPL +2.2 % payment by crypto. There’s a lot of such use cases for crypto, and we expect these to grow quickly in the coming year. Trading will nevertheless be reflective of this adoption curve; the higher the adoption, the more bullish the entire 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 throughout 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 worth following bitcoin, has soared by 300 % over the last 12 months amid a flurry of attention in decentralized finance (DeFi) – utilizing crypto technology to recreate traditional financial instruments such as loans as well as insurance with many DeFi projects built along with the ethereum network.
“From the trading viewpoint, virtually all of the year’s focus has been on yield and structured items, we have seen a major wave of futures products as well as alternatives products come to market, and it is likely more will follow soon,” Crosby said.
“We have observed several of the’ edge case’ crypto assets be mainstream also, which should remain in the new year.”