On 3rd January 2021, Bitcoin reached the value of $34,800 – a new high in its twelve years of its origin. The value of the cryptocurrency quadrupled in 2020 (saw a growth of almost 300%). After the feat on the first Sunday of 2021, things look extremely good for this volatile crypto coin. For the first time, the cryptocurrency went beyond 30,000 or £22,000, raising hopes in the market that Bitcoin can soon become one of the leading payment methods.
The rise and growth of the crypto coin is being compared with a similar performance in 2017, with experts terming it as ‘parabolic rise.’
What does this rise mean?
Bitcoin supporters feel that Bitcoins can soon be supplanting gold and believe that this phenomenal growth in its value means that the future is bright for Bitcoin traders and holders. It is important to mention here that many financial institutions worldwide are expressing interest in Bitcoin as an asset class.
Last year, one major achievement that the cryptocurrency was able to garner was that PayPal allowed users to buy and sell or use Bitcoins. The good thing is that in recent times there has been a lot of institutional and corporate buying that has happened with Bitcoin. For example, in December 2020, Ruffer, a UK investment management firm, announced that it had £550m Bitcoins. Many other hedge fund managers vociferously backed the cryptocurrency as a strong asset. Additionally, some sort of regulatory de-risking has bought in more trust for the cryptocurrency.
At present, there are about 18 million Bitcoins, while the hardwired maximum is about 21 million.
What are the expectations in 2021?
1. The widespread acceptance of Bitcoin is expected to grow further. Experts expect more mainstream acceptance of Bitcoin, especially by American and European banks.
2. Regulations might get more stringent, especially in the US. The new-president elect Joe Biden is expected to be good with cryptocurrencies, especially in the regulatory domain.
3. There are big predictions from believers for this year. Some think that the value of the cryptocurrency is going to touch 50,000 or more. And, after the extraordinary rise in the first week of January 2021, believers are rejoicing and expecting Bitcoin to perform better from here consistently.
Things are looking good and bright for Bitcoins. It is still early in the adoption curve. For example, to reach the gold market size, Bitcoins need to grow by at least 30 times. For potential investors, this is the time to wait, watch, and react depending on the market conditions.
