The year 2020 has been tough for everyone around the world. The malls were shut and the cities were blocked. There was an air of depression, spread all around the world. People were quarantined and many were deprived of their jobs. The pandemic struck so badly that people started finding ways to sustain this phase of their lives. When there was no hope of a job for many people they had to look for alternatives. On the other hand, many people were restricted into their homes and continued their work from there.
However, it was a catalyst year for the bitcoin industry. This was mainly due to the lockdown that was imposed nearly in all countries. People had nothing much to do so some entered the crypto world to get some thrills. Analysts concluded that the number of people who entered this virtual world increased during the pandemic.
China recently started a trial towards a cashless future. That does not mean that it replaced digital currencies such as Bitcoin. Rather China made a digital currency that is controlled by the central bank. Whereas Bitcoin is a decentralized currency. This can be a challenge for digital currencies. There is a political will behind this pilot project. The launch of the digital yuan was basically due to the zero-intervention of the governments in the bitcoin transactions. This could be a challenge for the bitcoins in 2021 in China.
High Price of Bitcoin
Bitcoin has already given us reasons to believe in its status. It has evolved over the years. The pandemic was harsh on every business and so was the Bitcoin industry under it. However, at the end of 2020, Bitcoin had shifted towards a high price which is good news for the traders. They can easily trade and track prices with bitQt appthat has made earnings lucid.
Bitcoin has gained 90% of its value, climbing from $10,400 on October 1 to $18,900 on November 21, 2020. The bitcoin market capitalization exceeded the records and reached as high as $337 which means that it has broken the previous records. With the reduced selling pressure bitcoin is predicted to go this way in the next year. It is predicted that the traders will have better opportunities with the bitcoin in 2021.
The selling pressure is predicted to drop in 2021 as people realise that Bitcoin rallied from $3,000 to $18,000 in the past eight months. When Bitcoin holders have to sell Bitcoins then they have to register on exchanges first. So, when Bitcoin exchanges decrease it means that there is a downscale in the selling pressure on the market. The Bitcoin liquidity is going down and so the holders will refrain from selling in the next year.
Demand from the investors
Many people predict that Bitcoin will replace gold in the future. 2021 marks the millennials to be prone to these digital currencies. This is the reason that Bitcoin will have greater adoption in 2021. According to JPMorgan’s note from October 2020, Bitcoin competes with gold as an alternative currency.
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The support of millennials can increase further adoption of Bitcoin in 2021 because more people are into bitcoin trading and Bitcoin payments systems.
New bitcoin adepts
PayPal has accepted cryptocurrency for financial transactions. The company said that PayPal users can even buy things through these virtual coins. Bitcoins can also be stored in the digital wallets of PayPal. Moreover, PayPal would make more buying options to aid people further.
The year 2021 is predicted to be the year of fireworks for Bitcoin. Bitcoin will replace gold as a hedge against inflation. There will be more Bitcoin debates and headlines as trading will reach the top list. The next era is more about digitalizing money and people will be more open to these currencies in the future.