BTC is actually coming to the end of one of the biggest 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 as well as cryptocurrency group looking ahead to a slew of innovations in 2021 – like 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 advantage room more” next year.
“Over the older twelve 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’d 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 speculative interest from standard investors, bitcoin and cryptocurrencies have observed a surge in take-up from the likes of payments giants PayPal and Square the year – something that’s likely to have a direct effect in 2021.
“2021 definitely centers around continual advancements in continuity between regular marketplaces and crypto markets,” Pierce Crosby, general manager at financial details business TradingView, said via email.
“A best example would be Square’s SQ +4.9 % bitcoin offering or PayPal’s PYPL +2.2 % transaction via crypto. There are plenty of such use cases for crypto, so we expect these to expand quickly in the coming year. Trading will still be reflective of this adoption curve; the taller the adoption, the more bullish the complete trading mix will be, which is a bullish base case for the major crypto assets.”
Bitcoin‘s volatility took “center stage” this season according to 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’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 weeks amid a flurry of interest in decentralized finance (DeFi) – using crypto expertise to recreate conventional monetary instruments for example insurance and loans with many DeFi tasks built in addition to the ethereum network.
“From the trading viewpoint, majority of the year’s focus has been on yield and structured items, we’ve observed a massive wave of futures products as well as options products come to market, and it’s likely more will follow soon,” Crosby said.
“We have noticed some of the’ edge case’ crypto assets be mainstream also, which should continue in the new year.”