As we enter one of the most awaited years for cryptocurrency investors, we can already see a certain number of trends becoming more prevalent. Among the many developments in the space, we believe that these trends can help investors discover new money-making opportunities, and benefit from what is about to come.
This is why we wrote this post. In the next few sections, we share the most important trends in the industry, and why you should care about them.
Trend #1 – Institutions start buying Bitcoin
Since September of 2020, we saw a large influx of institutions rushing to buy Bitcoin as a hedge against inflation. We are still early and expect this trend to experience massive growth in 2021. Knowing this, you might be willing to prepare for a supply shock – one that could increase the demand and price of BTC to new heights.
Trend #2 – Bitcoin options will grow in popularity
We believe that Bitcoin options trading will increase in popularity as more retail investors try to find ways to increase their position and exposure to the popular digital currency. This extends to all derivatives products that have been introduced over the past two years by trading platforms.
Trend #3 – DeFi will also continue to grow
DeFi (or decentralized finance) will continue to increase in popularity as more retail buyers will gradually leave centralized platforms and choose decentralized ones instead. We expect a massive need for education in this area, but also beneficial price action for projects that power up the foundations of this subsector (ETH, LINK, etc.).
Trend #4 – Non-Fungible Tokens will have a banner year
NFT increased in popularity during 2020, especially in the areas of digital art and virtual land sales. We expect more creators to migrate into tokenized markets in order to increase their income and benefit from the upcoming opportunities.
Trend # 5 – Institutional wallet custody is needed
With institutions buying enormous amounts of BTC, there is a high probability that we will see a lot more crypto custodians and institutional wallets entering the market. This of course will happen gradually, as most institutions are still somewhat hesitant to convert their balance sheets into BTC.
Trend #6 – Tighter regulatory frameworks
Finally, we believe that regulations will become more clear on a global scale. We also believe that these will become tighter in the US, as the instability of the economy pushes many to consider diversification into the popular digital currency.