The end of 2021 is approaching. As we wrap up the year, we thought it was time to take a look back at the developments in cryptocurrency over the past year, which has undoubtedly attracted growing interest.
In fact, 2021 has been a crazy year for crypto. With so many events unfolding in the crypto space, could this year be the tipping point for cryptocurrencies?
Let’s start with the key statistics for 2021. First, there was an upward trend in crypto research.
According to top Google searches for news, “Dogecoin” and “Ethereum Price” were among the top 10 searches.
Elon Musk’s tweets on Dogecoin also had a role to play in this renewed interest in the “same coin”. This means that more and more newbies are starting to take an interest in cryptocurrencies.
Cryptocurrency is also a popular topic on Reddit, with around 6.6 million mentions on the website this year.
Second, the price of Bitcoin hit an all-time high in 2021.
In 2020, Bitcoin topped US $ 20,000 and hit an all-time high of nearly US $ 30,000. This year, Bitcoin has exceeded expectations and hit an all-time high of nearly US $ 70,000.
Will Bitcoin be able to cross the US $ 70,000 mark next year? With Bitcoin’s exponential growth and adoption, it’s definitely exciting to watch prices in 2022.
Let us now return to the emblematic moments of the year.
1. The year started with an NFT boom
In January, we started the year with a trending topic that would last all year: non-fungible tokens (NFT).
NFTs are digital tokens that represent something unique and related to the blockchain. NFTs are valuable because they are able to prove the authenticity of digital or physical items. More importantly, the NFT cannot be modified or replicated.
The most expensive NFT in 2021 was Everydays By Beeple, which sold for almost 40,000 Ether (equivalent to almost $ 69 million).
Games with NFT also gained ground in 2021, and the best example is Axie Infinity.
Axie Infinity is an NFT based game inspired by Pokemon and Tamagotchi. You can play to win by trading, fighting, or even raising adorable new characters called Axies. Each Axis is unique and represented by NFTs.
To play the game, players must form a team of three unique Axies to participate in the battles. These Axies can be purchased on the Axie Marketplace with Ethereum (ETH).
As of October 2021, over two million monthly active users were using the game, leading to an impressive number 953% monthly volume growth. Additionally, the price of the AXS token has skyrocketed in 2021, from US $ 6 at the end of June to an all-time high of US $ 150 in November 2021.
The game is so profitable that some players can earn more than the average wage of a worker in their country by playing the game.
NFTs are mainly used in the field of art and games. Recently, NFT characters have also been touring the internet. Have you seen these pixelated cartoon characters as profile pictures on social media?
These “cartoons” are actually part of the limited edition NFTs that are released. The most popular series are the Bored Ape Yacht Club, Crypto Punks, and Crypto Kitties.
For example, there are only 10,000 NFT Bored Ape in circulation and no such NFTs are done on the blockchain anymore. One of the few Bored Ape Yacht Club NFT even sold for $ 3.4 million.
Usually these NFTs are hosted on Ethereum networks. This means that you have to buy an Ethereum (ETH) token – which can be bought on a platform like Luno – to buy NFTs on marketplaces like Opensea or Mintable.
2. “I’m in” – More and more companies are starting to embrace crypto
With more attention devoted to cryptocurrencies, companies are taking it more seriously. Businesses have been involved in several ways.
On the one hand, Tesla and Square both hold Bitcoin reserves. Tesla announced in February that it had purchased US $ 1.5 billion worth of Bitcoin, holding it as reserves. Shortly thereafter, Square also purchased US $ 170 million worth of Bitcoin as reserves.
This is a breakthrough because it shows institutions and individuals that Bitcoin can be a form of reserve asset, similar to gold. Bitcoin is commonly referred to as digital gold because its supply is limited and it is impossible to counterfeit.
Additionally, Adidas and Nike have joined the Metaverse sneaker war.
Adidas collaborated with Bored Ape Yacht Club on their “Into The Metaverse” project, allowing fans to purchase limited edition Adidas merchandise in NFT form. Nike also bought out a company that makes virtual shoes and sneakers.
It might sound weird – after all, why would we even need virtual shoes? Like a pair of Nike shoes in the real world, limited edition shoes are a status symbol and a way to stand out from the crowd.
As more companies head into the metaverse in the near future, these brands are trying to establish themselves in the space.
3. Countries are also getting involved in cryptocurrencies
As more companies embrace cryptocurrency, countries want a share of the action as well.
Of course, we can’t miss one of the biggest novelties of the year: El Salvador and its adoption of Bitcoin.
In September, the government of El Salvador sent shockwaves around the world when it announced that it now accepts Bitcoin as its national currency, making it the very first country to adopt Bitcoin as legal tender. .
Opinions on this decision were divided. On the one hand, the price of Bitcoin fluctuates more than normal fiat currency, making it risky to buy daily errands with Bitcoin.
On the other hand, we can see how it is possible to adopt Bitcoin as a payment system and national currency.
4. Development of central bank digital currencies (CBDC)
Speaking of national currencies, we should also mention the CBDCs. CBDC is a digital currency that runs on the blockchain developed by central banks.
Although there is one currency that dominates the industry, the most notable project is the Digital Yuan in China. The central bank of China has already carried out tests in several cities such as Shanghai.
Since most Chinese already use electronic payment on a daily basis, transit to a CBDC would be interesting.
Other notable CBDC projects are the Ubin project in Singapore and the digital euro in Europe.
2021 has been a busy year for crypto
Research results have proven that there is a growing focus on cryptocurrencies. Companies have started using Bitcoin as a reserve, and countries are also experimenting with Bitcoin and other cryptocurrencies.
As consumers, governments, and businesses all get more involved in cryptocurrency this year, we may see a turning point in cryptocurrency adoption in 2021.
It is clear that cryptocurrency will play an important role in the years to come thanks to the massive levels of adoption across the board. As such, this is the best time to learn a few basics and get started in crypto.
If you want to learn more about crypto but aren’t sure exactly how to go about it, Luno has a beginner-friendly learning portal where you can get all your Crypto 101 questions answered.
You can learn more about the origins of Bitcoin and the differences between Bitcoin and Ethereum through bite-sized videos. You can also learn more about Bitcoin and other major coins through Luno’s educational portal.
To get started, simply create an account with Luno, which offers free and fast deposits so you can quickly get your hands on some Bitcoin.
You can buy Bitcoin at a low transaction cost of 0.75% and earn up to 4% interest on your BTC and ETH on the Luno Savings Wallet. To learn more about how to easily buy and invest in crypto, check out this guide here.
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