In a year in which retail investors have bet heavily on the financial markets, cryptocurrencies have once again taken center stage. The expectation of huge gains in short periods of time attracted many people and led bitcoin, the most popular, to appreciate by about 60%.
According to an analysis by the portal "Eco Online," the price of the virtual currency rose from $28,994.01 at the beginning of the year to $46,306.45 on December 31. But despite being an enviable gain, 2021 was not even one of the three best years in bitcoin's history in percentage terms. In 2020, the year of the pandemic's arrival, the cryptocurrency more than quadrupled its value, following the 87% rise recorded in 2019, but leagues away from the 1,318% surge recorded in the full year of 2017.
At the price level is another story, because 2021 was by far the year in which the value of bitcoin against the dollar grew the most fat. Buying a bitcoin on December 31 was $17,312.44 more expensive than a year earlier. On November 9, someone paid $68,789.63 for a bitcoin, an all-time high.
In 2021, several major investors entered the cryptocurrency market. Examples of this are Tesla's $1.5 billion investment in bitcoin, the news that Amazon is working in the area, and the launch of the first bitcoin futures ETF (exchange-traded fund), long awaited in the market.
Among the personalities who have publicly admitted to investing in cryptocurrencies is Tim Cook, CEO of Apple. El Salvador, a small Central American country with just over six million inhabitants, has adopted bitcoin as its official currency, prompting protests from citizens.
The total value of the cryptocurrency market is getting closer and closer to the market value of a major company like Apple, the world's largest listed company. The 16,238 "cryptos" tracked by the CoinMarketCap platform, a price aggregator, reached the end of the year worth just over two trillion dollars, almost three times as much as a year ago, while Apple closed the year worth 2.9 trillion, a difference already less than 40%.
On Wall Street, terms such as bitcoin, cryptocurrencies and NFT (non-fungible tokens, a type of cryptoactive) are no longer viewed with suspicion. Having a slice of your portfolio invested in crypto is now almost as common as allocating part of your assets to stocks and part to bonds. In the technology world, the theme has gone hand in hand with another trend, the "metaverse", a kind of online parallel universe. Facebook embraced the idea and changed its name to Meta.
Enthusiasts see bitcoin rising to $100,000 and beyond. The most ardent supporters see the currency overlapping the dollar and the euro, something unlikely in light of the information currently available. But no one knows for sure what will happen to cryptocurrencies in 2022. It could be another year of massive gains, or a new "winter" as happened in 2018, a year in which the value of the most popular virtual currency depreciated by 72.6%. For now, bitcoin enters 2022 losing 5.89% in the accumulated last week.
Talking about cryptocurrencies is not just about speculation. From the same medium have emanated technologies that promise to revolutionize areas such as property records and the art world. For example, Ethereum is now a huge global computing network, serving as the basis for running decentralized applications and sub-segments of the "crypto" world, such as the DeFi (decentralized finance) universe. The development of the ecosystem may explain why, by 2021, the eponymous cryptocurrency will be worth almost 400%, considerably more than the rise of bitcoin.
At this point, the only possible guarantee is that in 2022, whatever the evolution of cryptocurrencies, the topic will continue to make the papers ink. And attracting the close attention of investors as well.