2021 was the most successful year for Bitcoin so far. From a tremendous rise in price to federal governments and public companies investing in BTC. Unfortunately, not everything was rosy. Financial regulators around the world increased their watch on the leading cryptocurrency. Scammers also turned the success of BTC in 2021 and made it a hallowing experience for some.
Below is a recap of top Bitcoin news making headlines in 2021:
BTC Price Reaches an All-Time High (ATH)
BTC started the year changing hands at 32,000 USD after breaking its 2017 record of $20K in December 2020. The new ATH was just the beginning of a stronger momentum later in the year.
It crossed the $64K mark in April and later touched its 2021 highest of $69K seven months later in November. The overall market capitalization also recorded an ATH of 3 trillion US dollars.
In between the all-time highs, the bears took charge, sinking the price to lows of $30K. The price is still recovering, trading at around $50K. With roughly four days left before the end of 2021, it’s unlikely BTC will be able to return to its highest price or even set a new one.
El Salvador Adopts Bitcoin
El Salvador embraced the leading crypto as a legal tender on September 7, 2021. The move placed BTC alongside the USD when paying for goods and services in the country. The central American country also set up a Bitcoin trust to facilitate the conversion between the two legal tenders.
Since adopting BTC and setting up a trust, El Salvador has been accumulating Bitcoin. In some cases, the central American country has liquidated part of its bitcoin holding to fund projects such as a veterinary hospital.
Public Companies Invest in Bitcoin
In 2021, Tesla, the leading electric car maker, announced it had drilled 1.5 million USD into Bitcoin. More than buying BTC, the car maker told the US securities watchdog that it plans to accept the virtual asset as a payment method.
The decision raised eyebrows because the company’s CEO, Elon Musk, associates himself with technologies with low carbon emissions.
The conflict led to Tesla abandoning plans to add Bitcoin to its list of allowed payment methods. As a result, BTC lost around seven percent. However, the electric car maker held on to the Bitcoin it had bought.
Apart from Tesla, Microstrategy, a business analytics company, increased its BTC holding in 2021. As of December 21, 2020, Microstrategy held slightly above 70,400 BTCs. Fast forward to December 10, 2021, the company holds over 122,400 Bitcoins.
The year also saw some companies dive into BTC through Bitcoin funds, such as the Grayscale Bitcoin Trust (GBTC). For example, top GBTC shareholders in 2021 included ARK Investment Management, Horizon Kinetics, Simplify Asset Management, Miller Value Partners, Systelligence, and Parkwood.
Companies File for Bitcoin ETFs, SEC Rejects Them
This year has also seen the filing of both futures and spot-based Bitcoin exchange-traded funds (ETFs) with the United States Securities and Exchange Commission.
However, the SEC favored futures-based BTC ETFs compared to their spot friends. For instance, In October, the securities watchdog okayed VanEck and Valkyrie’s futures-focused Bitcoin ETFs but rejected spot-based Bitcoin ETF such as the one filed by Kryptoin.
The SEC noted that the applications failed to meet standards “designed to prevent fraudulent and manipulative acts and practices.”
China Bans Everything Bitcoin and Crypto
Although China banning crypto is not a surprise considering it has unsuccessfully done so in the past, this year was different. In 2021, the South East Asian country was more committed to eradicating everything from Bitcoin mining, trading, and selling BTC-focused software and e-books.
The country took it a notch higher and declared Bitcoin mining as “extremely harmful” to the environment, and started hunting down and shutting crypto mining activities. It also added crypto mining to the list of blacklisted industries.
Bitcoin miners migrated to Russia, Kazakhstan, and the USA. Crypto trading platforms such as Binance and Huobi also indicated plans to stop serving customers in mainland China.
What’s in Store For Bitcoin in 2022?
Although it’s hard to predict with certainty what will happen to BTC in 2022, we expect the regulatory scrutiny to continue.
The Bitcoin price is also likely to touch new highs in the coming year. In addition, more publicly-traded companies are likely to see Bitcoin as a better hedge against inflation compared to gold and other precious metals.