Bitcoin Recap 2021 and What’s Up Ahead for 2022?
The broader cryptocurrency market performed phenomenally well this year of 2021 almost growing three times in size to a staggering $2.5 trillion dollar. While the world’s largest cryptocurrency took the charge of the market rally in the first half of 2021, altcoins followed the charge soon.
Let’s take a look at how the world’s largest cryptocurrency Bitcoin performed and what’s in store ahead for the upcoming year of 2022. Over the year, the Bitcoin price action was dominated largely by regulatory actions, institutional participation, and much more.
Bitcoin (BTC) started the year of 2021 at 29,000 levels with Tesla making an early announcement in mid-Feb of adding Bitcoin to its balance sheet. This was enough fuel for Bitcoin to quickly surge more than 100% to hitting a new high of $64,000 by mid-April.
However, this was followed with strong price volatility due to the tectonic shift taking place in the Bitcoin mining industry. In mid-May China announced a sweeping ban on the country’s much-evolved Bitcoin mining industry following which there was a massive price crash in the price of BTC. The BTC price plummeted by 50% from the highs eroding all the yearly gains and crashing back under $30,000 levels.
Post the China ban on Bitcoin, the BTC hashrate plummeted in the following month. However, it has now completely recovered and is currently at its all-time high. Thanks to the swift shift of Bitcoin mining industry from China to North America. Also, the Bitcoin mining industry has witnessed a major shift in the use of green energy after severe cancers of Bitcoin mining carbon footprint.
The Bitcoin price volatility continued up to mid-July post which the Bitcoin picked up northward momentum amid the broader market recovery. By November last month, the Bitcoin price touched a new all-time high of $69,000 and has been moving sideways since then currently trading at $50,000.
The second-half of 2021 was more about growing regulatory clarity for Bitcoin. Latin American country El Salvador made Bitcoin its legal tender in September 2021 and has been continuously adding the dips since then.
On the other hand, the U.S. Securities and Exchange Commission (SEC) approved the first Bitcon ETF linked to the CME futures contracts back in September. But, it hasn’t been enough to trigger a major price rally for Bitcoin.
As of press time, Bitcoin is facing downward pressure and trading under $50,000. This is still 66% gains year-to-date.
Going ahead in 2022, we are expecting the arrival of the first spot bitcoin ETF in the U.S. It can probably infuse massive liquidity driving another crazy rally for Bitcoin in 2022. Furthermore, we are expecting more clarity in regulatory rules for Bitcoin and other digital assets across other countries.
Many market analysts have been expecting Bitcoin to hit $100K levels by the year end, however, it seems that the rally might extend to Q1-Q2 2022.