Anyone investing in, or even just watching, the bitcoin market has had a crazy ride this year. In December 2020, the most expensive virtual currency of the world was worth around $23000. Bitcoin currency worth was $4,000 when the US first started dealing with Covid-19 in early March 2020. It’s a gut-wrenching source of profits and losses for both buyers and sellers. It’s an exciting business presentation with hints of envy and dizziness for those on the sidelines.
According to kafila.org there was a huge price swing in bitcoin, but 2020 was also a year of maturity for this currency that has only been trading for almost 10 years. For the year 2021, I see the following trends:
Acceptance by The General Public:
The use of Bitcoin in daily life has always had a chicken-and-egg dilemma, in that few people use or support it. However, bitcoin adaptation changed drastically in 2020. Popular fintech companies, such as Square, which invested $50 million in bitcoin, and PayPal, which allows its users to buy and sell bitcoin, have given it their seal of approval. We’ll possibly see a continuation of this mainstream embrace in 2021. At least one major U.S. or European bank is expected to announce a scheme in which they either facilitate bitcoin transactions or agree to retain digital assets for their customers.
Big Tech Is A Competitor:
As bitcoin has achieved a remarkable status in its decade of existence; it has compelled many multinational companies to consider offering an international digital currency of the world. Every business in the payment industry recognizes that not only is there still a need for digital payments to be had, but that charges involving multiple currency markets have the greatest potential. That’s because such transactions currently take days to complete and come with steep fees.
This Bitcoin digital currency speeds up the progress worldwide with significantly within few. Both Facebook and Google, which have a global scope that bitcoin can only dream of, have announced large digital currency plans this year.
Central Banks Compete With Each Other:
According to a study and survey published this year by the Bank for International Settlements, 80 percent of the world’s central banks are working on digital currencies in a certain way. China has spent much more time playing with digital currencies than any other region. Demand for bitcoin and other independent cryptocurrencies is expected to decrease as China steps closer to a national implementation of the digital Yuan. In the coming year, related experiments will be carried out in other countries.
Suzhou, city of china, which is located just west of Shanghai, a lottery was conducted in 2020, in which 100,000 residents were given around $30 through a digital wallet for its digital progress and awareness. They were told to add their digital cash to their bank accounts, because if they didn’t use it within a few weeks, it would vanish, all of which were great ways to advance the experiment.
A New Regulatory Landscape Has Emerged:
A new regulatory climate has arisen. In the first 90 days, the administration of President-elect Joe Biden would have greater problems than the oversight of cryptocurrencies, and Congress’ environment and experience on the matter are impossible to assess. A normal assumption is that a Democratic government would enforce tighter rules than a Republican administration. Perhaps, but bitcoin enthusiasts ignore problems like anonymity and the potential for fraud, which are major concerns for regulators.
Biden’s team might come up with a more thorough and reasonable approach to cryptocurrency regulation, but I wouldn’t bet on any special treatment for bitcoin.
The turbulence isn’t going anywhere any time soon. We recognize that the valuation of bitcoin isn’t specifically related to any discernible real-world phenomena (such as fiscal or monetary policy), and that it can appreciate or depreciate in volatile and difficult-to-understand ways. As a result, it’s difficult to recommend it as a healthy fund for those trying to prevent major losses.
Some expect that Bitcoin will hit $50000 next year, which, while doubtful, is not out of the realm of possibility if investors move their funds from other investments to bitcoin. Of default, in 2021, the price is likely to head in the opposite direction.