With the first listed companies and legendary investors to publicly proclaim their support for Bitcoin, 2021 will go down in history as the year of mass adoption and the start of institutional interest in crypto.
After an already crazy year for crypto in 2020, the market continued to soar and more importantly, network adoption followed suit. An estimated 400 million people are using crypto today and many predictions are circulating as to when we will see 1 billion people actively using crypto.
Binance CEO Changpeng Zhao believes this will happen this year, while other forecasts, as seen below, are calling for a more conservative target for 2024.
Crypto adoption has grown at over 110% per year since the launch of Bitcoin in 2009. This surpasses the adoption rate of the internet. Even at a conservative estimate (80% over three years, followed by 33% growth), this adoption curve could easily reach 3.7 billion users worldwide by 2030.
With all this acceptance, let’s break down the key events of 2021 and show you that if these institutions, countries, and investors take crypto seriously, you should too.
2021 held some important milestones for the industry. We’ve seen institutions like Tesla and Square buy large amounts of Bitcoin. World-renowned auction house Christie’s held its first NFT auction, and it was a record-breaking one. We even saw Coinbase go public and China ban crypto…again. But the biggest news came from a small country called El Salvador.
El Salvador becomes the first country to accept bitcoin as legal tender
Bitcoin has been an official currency of El Salvador alongside the US dollar since September 2021.
This was a historic moment, not just for Bitcoin, but for the entire cryptocurrency asset class. Many crypto naysayers resort to the statement that “cryptocurrencies cannot perform the classic functions of money”, but here is a country that uses it as its national currency.
In El Salvador you can walk into a McDonalds, scan a QR code and you’ve paid for your meal with Bitcoin. Not only was this meal priced in cryptocurrency units, but you used your stored bitcoins as a form of payment. The naysayers cannot deny that Bitcoin fulfills the “classic functionality” of money.
Why did El Salvador choose Bitcoin?
President Nayib Bukele mentioned that legalizing Bitcoin would encourage investment in the country and help more than 70% of Salvadorans who do not have access to traditional financial services. It’s also an inexpensive way for people outside the country to send remittances to their families inside the country.
El Salvador plans to issue the first-ever Bitcoin bond. This bond will raise $1 billion, which will be split between a $500 million allocation of bitcoin and $500 million for infrastructure spending to expand energy and bitcoin mining infrastructure.
The very first bitcoin futures ETF is launched
October 2021 marked a milestone for the cryptocurrency when investors began trading the first US Bitcoin exchange-traded futures fund. The ProShares Bitcoin Strategy ETF enjoyed one of the biggest first days on record for ETFs, raising $550 million from crypto-hungry investors. In total, more than $1.01 billion in shares changed hands.
What is a Bitcoin Futures ETF and how does it work?
The exchange-traded fund (ETF) tracks the futures price of the digital currency and allows investors to buy into the ETF without trading Bitcoin itself.
This was a relief for many investors. Finally there was a product that allowed them to access Bitcoin in a regulated and structured environment. Due to the huge demand for cryptocurrencies, it took the fund just two days to raise $1 billion — making it one of the best launches for an ETF ever. The initial spike in interest showed the level of crypto exposure pent-up demand among US investors in ETFs.
What does that mean for you?
There is a clear interest and demand for cryptocurrencies in both the traditional and alternative space as more and more people start to understand cryptocurrencies. The approval of a Bitcoin ETF shows that regulators are finally starting to accept crypto as an asset and asset class. This also helps regulated investors gain access to this asset class, further fueling demand for crypto and further driving crypto market adoption and resilience.
Crypto market cap hits $3 trillion mark
November 2021: The crypto market proves its resilience and shows exceptional growth, reaching a market cap of $3 trillion. For comparison, the only countries with a higher GDP ranking are the US, China, Japan and Germany. Apart from these four countries, the crypto market cap overshadows the GDP of all other countries.
The chart above shows how quickly the market cap has grown, hence the phrase “2021, the year for crypto”.
This is a major milestone for the crypto industry. It underscores investors’ confidence in the potential of blockchain technology to disrupt the way we humans interact with just about everything. Bitcoin has proven that it can be a hedge against inflation as many investors seek protection from an inflationary environment.
Will Crypto Continue This Parabolic Growth?
Market analysts believe that cryptocurrencies are the biggest financial revolution in modern history, and it looks like the consumer will agree. Finally, crypto is showing a faster adoption rate than the internet. Just think of everyday life outside of the internet. Hard to imagine for most. This will also apply to blockchain technologies if we fast forward 10 years into the future. And this market hasn’t just been driven by retail, we’re also seeing big institutions betting on crypto and blockchain technology.
There’s a reason Facebook changed its name to “Meta” — the signs of global adoption are everywhere.
US inflation hits 40-year high – is crypto the life raft?
Remember all the money that poured into the global financial system in 2020 and 2021? Well, it actually turns out to be about 15% of all the money in circulation today.
This mass issuance of money printing causes one thing in particular – inflation.
This basically means that life is getting more and more expensive and you just don’t buy as much with your money as you used to. One thing is for sure: Bitcoin and crypto have actually outperformed money printing by over +300%, meaning that not only have you kept your purchasing power, you’ve even significantly improved it. Compare that to keeping your money in the S&P 500 (which also performed pretty well), which only outperformed money printing by +4%.
During this period of over-printing, crypto has been the lifeboat offered in a sea of inflation.
So all of this begs the question?
If institutions are investing in crypto, if millions of people are adopting it faster than the internet, and if countries are embracing it, then why aren’t they?
Where can I get access to this asset class?
Whether you’re looking to invest in the most reputable standalone assets and take the risk, or seek a safe option through a basket of diversified cryptocurrencies, Cape Town-based cryptocurrency investment platform Revix has you covered.
You will find an easy to navigate platform for investing in single cryptocurrencies like Bitcoin, Ethereum, Solana, Binance Coin, Polkadot and many more.
The platform also takes the guesswork out of long-term investments by giving you better value with bundle deals.
Revix offers its customers access to ready-made Crypto Bundles that contain the most reputable cryptocurrencies in each sector. These bundles are automatically rebalanced every month to ensure your bundle is up to date with the rapidly changing world of cryptocurrencies
There is no need to pick a single cryptocurrency and risk it not sticking around. With Revix, simply select the sector that interests you and we’ll do the rest.
Revix allows users to invest in three different themed packs:
the Top 10 Pack is like the JSE Top 40 or S&P 500 for crypto. It offers equal weighted exposure to the top 10 cryptocurrencies, which make up more than 75% of the crypto market. This bundle has significantly outperformed Bitcoin over the past 12 months.
the Smart contract package offers an equal exposure to the top five smart contract focused cryptocurrencies such as Ethereum, Solana and Polkadot. These cryptocurrencies allow developers to build applications on their blockchains, similar to how Apple builds apps on its OS operating system.
the payment bundle offers an equally weighted exposure to the top five payment-oriented cryptocurrencies that aim to make payments cheaper, faster and more global. These cryptos include Bitcoin, Ripple, Stellar, and Litecoin.
Revix brings simplicity, confidence and great customer service to investing. Their easy-to-use online platform allows anyone to securely own the best investments in the world with just a few clicks.
Revix guides new customers through the signup process through to their first deposit and investment. Once set up, most customers manage their own portfolio but can always access support from the Revix team.
For more information, please visit www.revix.com
This article is for informational purposes only. The views expressed are not investment advice or recommendations and should not be construed as such. This article is neither an offer nor a solicitation of an offer to buy or sell any assets or securities mentioned herein. You should not invest more than you can afford to lose and before investing please consider your level of experience and investment objectives and seek independent financial advice if necessary.
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