It’s been quite a turbulent year for the crypto market.
In March, Bitcoin was trading below $4,000 and many thought that another bear market was on the horizon due to the pandemic. Just nine months later, the market is euphoric, with many thinking that the cryptocurrency market will take over the global financial markets.
Investors in the space are rightfully optimistic heading into 2021, especially due to the sheer amount of financial and human capital entering Bitcoin, Ethereum, DeFi, and other crypto “industries.”
The year of DeFi
Most say that 2021 will be the year that decentralized finance truly takes off.
While DeFi’s total value locked (TVL) has seen a growth of 3,000 percent over the past 12 months, the amount of capital in this space only represents under three percent of all value in the cryptocurrency market.
This shows that there is room for considerable growth as these platforms scale.
“But other networks will enter the space in a more material way, putting other native tokens to work in Ethereum’s DeFi ecosystem. With the various tokenized bitcoin options (tBTC, ren, wBTC) growing in popularity, we will see bitcoin’s $430 billion market cap collateralized in DeFi. This will grow the TVL in DeFi exponentially.”
This was echoed by other market participants, such as Andrew Kang, managing partner of Mechanism Capital.
He told Global Coin Research and his Twitter following that there will be over $100 billion worth of value locked in this nascent space by the time 2021 finishes.
A number of other investors mentioned in that Global Coin Research report, including Simon Kim of Hashed and Kelvin Koh of Spartan Capital, also mentioned a similar target for 2021.
Bitcoin to hit $50,000 and beyond
The other most common prediction is that of Bitcoin passing a $50,000 price, which would give it a market capitalization over $1 trillion.
What makes this prediction interesting is that it is only around an 80 percent rally from current price levels. While this would be healthy for any other asset in the space, an 80 percent rally is actually far below what many expect for 2021.
One factor to consider is that during bull markets, some investors may be more hesitant to sell BTC than if they were in other phases of the market, such as a bear phase. This means that the investment of a dollar may have a larger effect than it had during a bear market.
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The post Top Bitcoin and crypto investors explain their predictions for 2021 appeared first on Crypto new media.