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Online Gold Rush: How Bitcoin Exploded in 2021

by Sneha

Online Gold Rush: How Bitcoin Exploded in 2021

2021 is a cryptocurrency gold rush. If you had $1000 dollars in ETH on January 1, 2021, you’d have made 471% returns by May. For Bitcoin that would have been a 198% increase. Why is there such a sharp increase in the 2021 H1 and will it continue through the second half of the year? Keep reading to find out!

Cryptocurrency Online Gold Rush

First of all, there are a few reasons why this gold rush started. There are also a number of factors keeping this gold rush alive, like:

  • Bitcoin ATMs like those from USA company ByteFederal
  • Exchanges like Kraken, Gemini, and Crypto.com
  • DeFi (decentralized finance) exchanges like Uniswap and Curve
  • Traditional monetary institutional inclusion, like PayPal and Visa

The biggest push of this gold rush came from institutions finally deciding that Bitcoin and Ethereum have intrinsic value and staying power. PayPal now accepts buy and sell orders for Bitcoin, Ethereum, and other select cryptos, but doesn’t allow you to do much with them. It isn’t a true wallet and isn’t meant to function as one. Instead, it allows you to use crypto for pure investment — at a price.

Kraken, Gemini, Crypto.com, and other exchanges now allow you to use your custodial wallet to buy products in brick and mortar shops using a debit-card-like system. Again, there’s a steep fee for using your crypto holdings as fiat currency. The card is also tied to the crypto holdings on the exchange it’s issued from on a custodial wallet system, which historically is wildly unsafe. Last, Defi grew up a lot during 2020 and matured. 2021 shows us that this space still has plenty of room to grow and offers great tools and products. This cryptocurrency space isn’t only for financial and tech whizzes anymore but opens up more and more to the mainstream population.

Elon Musk

One of the largest examples of this was the adoption of Bitcoin as a payment method for Tesla vehicles. Elon Musk adopted this method, hoping to cash into crypto. Later, he learned about some misconceptions about the environmental impact that Bitcoin and other cryptocurrencies have. Almost as impulsively, Elon Musk pulled Bitcoin off as a payment method for Tesla and gave Dogecoin a hard snub on Saturday Night Live.

Finally, after Elon Musk left cryptocurrencies alone, the whole crypto-economy is becoming less volatile. Bitcoin has stayed between $29,000 and $33,000 per bitcoin since Elon left.

The Value of Cryptocurrency In 2021

The major gold rush may be over, since Bitcoin topped out around $63,500 on April 13. It’s now stable above the December 31, 2020 level, capitulating, and priming for another rise. The next one is expected to reach possible highs near $100,000 per BTC. However, Ethereum may go even higher. If Bitcoin almost doubled in price by May, and Ethereum almost quintupled, it means that you can get more returns through Ethereum — in theory.

This year Ethereum also launched its Beacon blockchain. This blockchain runs on Proof-of-Stake (PoS), rather than Proof-of-Work (PoW). This could make it more economically feasible and transactions per second (TPS) will shoot through the roof.

Into the Future With Cryptocurrencies

The next gold rush could come at any time, but might not be with Bitcoin. If you invested in Ethereum and other DeFi products, you may have seen that fact play out earlier this year.

Bitcoin is the biggest and most visible player, for now, in crypto. Being the original big-bad, Bitcoin will always be the herald for the space. Ethereum is definitely the more utility-driven of the two and institutions and mainstream populations are catching on. Need to know more about what’s going to happen in the future with cryptocurrencies? Keep browsing our articles for the latest finance and tech news on the web!

 

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