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 some of the world’s biggest investors.
Right now, with the bitcoin and cryptocurrency society looking forward 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 laws – Wall Street giant Wells Fargo WFC +1.5 % has said it expects to be “discussing the digital advantage room more” following year.
“Over the older 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 year – “that’s along with the ninety % gain it’d in 2019” – naming cryptocurrency investing as “a bit like living in the first days of the 1850’s gold rush, which involved more speculating over investing.”
And also speculative interest from standard investors, bitcoin along with cryptocurrencies have seen a surge in take-up from the likes of payments giants PayPal and Square the season – something that’s likely to have a direct impact in 2021.
“2021 really centers around continual developments in continuity between standard markets 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 perhaps PayPal’s PYPL +2.2 % transaction by crypto. There are lots of such use cases for crypto, so we expect these to grow quickly in the coming season. Trading will all the same be reflective of this adoption curve; the taller the adoption, the more bullish the complete trading mix will be, which is a bullish bottom case for the main crypto assets.”
Bitcoin‘s volatility took “center stage” this year according to Crosby, with the bitcoin price 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 over the’ Summer of DeFi,’ which echoed the initial coin offering (ICO) boom back in 2017.”
Ethereum, the world’s second largest cryptocurrency by worth after bitcoin, has soared by 300 % during the last 12 weeks amid a flurry of attention in decentralized finance (DeFi) – utilizing crypto technology to recreate traditional monetary instruments including insurance as well as loans with numerous DeFi tasks built in addition to the ethereum network.
“From the trading viewpoint, virtually all of the year’s focus has been on yield and structured items, we’ve noticed a massive trend of futures products as well as options items 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 as well, and this should continue in the new year.”