As we have already entered 2021, many people are thinking about crypto predictions for this year. Many professional traders are quite optimistic about cryptocurrencies. In contrast, some people are still keeping away from crypto assets.
However, there is a huge interest in cryptocurrencies among investors in 2021. There are several reasons behind the popularity, but the primary reason is Bitcoin, Ethereum, and a few other popular cryptocurrencies are steadily rising. If you are not sure what 2021 has in store for virtual currencies, read on.
Potential and Drawbacks of Crypto in 2021
What are your expectations from cryptocurrencies this year? If you have not invested in Bitcoin or any other cryptocurrencies, here are the top five predictions that may help you build your crypto portfolio this year.
Massive Adoption of Crypto in 2021
After the global pandemic, more people have entered the crypto space. Below are some critical reasons for the notable rise in the number of people in the crypto market.
- They found crypto as a store of value as traditional investment assets are not performing well during the coronavirus pandemic in 2020.
- Inflation of most of the cryptocurrencies is not possible due to decentralization and fixed supply.
- PayPal, the largest payment processor, announced that it would allow its users to
- Since there are wide applications of the Blockchain technology that drives cryptocurrencies, many people think that crypto will be the future of money.
- Another major reason is the predictions of cryptocurrencies by some of the large investors are optimistic.
Bitcoin May Surpass $50,000 in 2021
Many successful investors, including Robert Kiyosaki, Chamath Palihapitiya, Winklevoss twins, predict that Bitcoin’s price will rise significantly in 2021. Robert Kiyosaki, one of the top investors in the US, suggests buying and holding Bitcoin. He says that Bitcoin will go beyond $50,000, and it will surprise the world with its price rise by the end of this year.
Billionaire investor Chamath Palihapitiya predicts that Bitcoin can surpass $50,000, then $100,000, then $150,000. However, he is not sure about the time frame, but he is quite optimistic about Bitcoin’s price. Winklevoss twins, the Bitcoin billionaires, predicted that some cryptocurrencies would rise 30-fold, and they referred to Bitcoin as the trade of the century. If you are interested, learn from cryptotrader.software about Bitcoin predictions.
Banks May Adopt Blockchain and Crypto
Initially, many banks are against cryptocurrencies. This is due to banks losing their control over the financial system if crypto becomes the future. They cannot impose the monetary policy as the crypto operates through Blockchain Technology, which is decentralized in nature.
However, some central banks have adopted Blockchain Technology as it offers high security. Another reason is that it makes transactions faster, reliable, and simpler with a public ledger. So, it’s expected that more banks and financial institutions will support and adopt Blockchain and cryptocurrencies.
Demand from Institutional Investors Will Accelerate
Since millennials are open to crypto and digital transactions, future generations will accept the concept of crypto. Apart from that, government and financial institutions are also showing interest in the regulations and adoption of cryptocurrencies.
One of the significant steps in the cryptocurrency industry is crypto custody solutions, which store investors’ crypto holdings securely. These are some factors that drive more big players to put large investments in virtual currencies.
XRP Under Uncertainty
XRP, one of the top cryptocurrencies, is going through uncertainties. Since the SEC has filed a lawsuit against Ripple Inc., which owns more than 60% of the total XRP tokens available, it’s going through a tough time.
Coinbase suspended the trading of XRP on its platform after the case and announced that XRP would be banned from its platform from January 2021. It has a significant impact on the price drop of XRP, and crypto investors are worried about their XRP holdings.
Although Ripple Lab is not the parent company of XRP, it holds a major percentage of the total number of tokens. If you are thinking of investing in it, stay updated about the legal case and be careful about your investments.
Hopefully, this article has helped you to know about the potential of cryptocurrencies in 2021. If you are not sure about investing in digital assets, you can learn more about them online or consult your financial advisor before making any investments.