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According to a report by the blockchain analysis company Chainalysis, Bitcoin investors in the United States have realized $4.1 billion in Bitcoin earnings in 2020.

                          

According to the report, "U.S. investors achieved a total of more than 4 billion U.S. dollars in Bitcoin gains in 2020, which is more than three times that of China's second place. Considering that China has the highest trading volume of original cryptocurrency so far in history, this It seems surprising, but...the US-focused exchanges have seen huge inflows of funds in 2020, and these funds almost all came in before the end of the year."

Chainalysis measures the on-chain funds flowing to different cryptocurrency exchanges, and then measures the difference between the USD price when the Bitcoin is withdrawn from the platform and the price when it is received to roughly calculate the global Bitcoin revenue in 2020. "Then we distribute these gains (or losses) by country based on the share of network traffic that each country accounts for on each exchange website. This analysis gives us a reasonable estimate, that is, the Bitcoin investment in each country. The realised gains that investors will receive in 2020, although it does not take into account the gains from assets that have not been withdrawn from the exchange.

Following the United States and China, Japan, the United Kingdom, and Russia are among the top five countries in terms of Bitcoin revenue in 2020. The report also emphasized that compared with traditional economic rankings, many countries seem to be enjoying incredibly high Bitcoin gains.

From the perspective of national economic volume, Vietnam, the Czech Republic, Turkey and Spain are all countries with extremely high Bitcoin returns.

At the same time, India¡¯s Bitcoin earnings have underperformed compared to its overall economic strength. This phenomenon may stem from the country¡¯s regulatory uncertainty over Bitcoin.

Overall, the report paints an expected picture: Bitcoin's staggering bull market for most of 2020 and 2021 means that many people around the world have made huge gains from the asset. But in this big picture, it does show some interesting trends.

The report also wrote, "The data shows that Bitcoin allows investors in emerging markets to obtain a high-performance asset, because under normal circumstances they may not be able to obtain such an asset. On the other hand, it also shows that trying to Countries that have adopted strict regulations to restrict the use of cryptocurrencies are preventing their citizens from enjoying this wave of dividends."


(This article is from Bitpush.News)
1. Bitcoin's next step: $20,000 or $100,000?

The trend is upward.

We believe that around US$40,000 may be the price ceiling for the rest period of the crypto bull market. The second-ranked Ethereum is rapidly moving towards the first position in market capitalization and has been the main driving force of the Bloomberg Galaxy Crypto Index in 2021. Bitcoin is more likely to break through resistance and rise to 100,000 USD, rather than fall below 20,000 USD.

                          

As we have seen, the Bloomberg Galaxy Encryption Index (BGCI) heralds that the bull market starting in June will start with a discounted Bitcoin price.

Bitcoin has pulled back about 50% from its 2021 high and seems to be establishing a bottom support of about $30,000. This level is close to last year's closing price and the 12-month moving average. BGCI has risen by about 130% in 2021. Compared with the peak of over 250% in early May, there has also been a nearly 50% correction. Many excessive speculations have been eliminated, and the fundamentals of Bitcoin remain intact.

The market value of Ethereum is expected to surpass Bitcoin.

The benefits of diversification need to be emphasized, especially in emerging asset classes like cryptocurrencies. The longer-term trend seems to be that Ethereum gains a larger market share relative to Bitcoin. Both have a bullish foundation, but the foundation and use cases of Ethereum are a powerful complement to Bitcoin's broader store of value. The figure below depicts transaction volume as a leading indicator for the development of Ethereum. In terms of market value, Ethereum has reached 50% of Bitcoin. From the beginning of 2021, the 10-day average transaction volume of ETH has doubled, reaching 80% of Bitcoin. (Coinmarketcap)

                         

Bitcoin and Ethereum may have unique timing advantages. If economic rules apply, reduced supply, historically low interest rates, and a large amount of funds injected into the system constitute a solid foundation for the price appreciation of crypto assets. Adoption is still in the early stages, but it is the key. Bitcoin seems to have won the game, as evidenced by Tesla's allocation of part of its equity wealth to digital assets.

The chart below depicts Bitcoin's annual mining supply falling below 1% by 2025 vs. the rapid increase in U.S. debt

                         

Usually, such a background is ideal for pushing up the dollar price of gold, but the reserve assets of the old world are being replaced by digital upstarts. We hardly see the power to stop this trend and expect it to accelerate.

10,000 cryptocurrencies have consolidated the foundation of Ethereum. The number of crypto assets listed on Coinmarketcap continues to increase, which is a tailwind brought by Ethereum, the main foundation of the token.

The figure below depicts the number of tradable cryptocurrencies that reached the 10,000 milestone, many of which are built on the Ethereum blockchain. Compared with about half of the figures a year ago, a large number of cryptocurrencies may indicate oversupply and excessive bubbles, but Ethereum is still at the top of the cryptocurrency gold rush.

                         

According to the chart, ETH currently appears to be at a low level, but we regard the number of tradable cryptocurrencies as a general guide for the broader market. Ethereum's trading range in May went from slightly above 4,000 US dollars to slightly below 2,000 US dollars. It may set key support and resistance for a period of time, and the upward trend is still a major trend.

2. Encryption Top 3: Bitcoin, Ethereum, Tether

Only when the tide is low can you know who is swimming naked, and Bitcoin, Ethereum, and Tether are all wearing "clothes" and shine in the top three positions in the crypto market. Bitcoin is a digital reserve asset, Ethereum is the main ecosystem builder, and Tether (an Ethereum token) represents a world that is rapidly moving towards digitization with the support of the dollar's dominance. Tether's entry into the third largest cryptocurrency market capitalization is one of the most consistent trends in the digital world.

Bitcoin, Ethereum, Tether-staunch survivors. Consistent strength and performance are worthy of respect. This is how we view currency digitization represented by Tether. Despite controversy and regulatory crackdowns, the rising market value of the world's benchmark USD token has always been a continuous indicator of the ever-expanding digital asset ecosystem. The figure below depicts the top three crypto assets on Coinmarketcap at the beginning of June: Bitcoin, Ethereum, and Tether.

                         

Although most crypto assets have fallen, Tether gained an important position in 2018, when its market capitalization and trading volume were still rising. The adoption of digital dollars is exploding, with Ethereum-based dollar tokens entering the top 10.

Tether and the digital wave. As we have seen, the digitization of Tether and currencies (especially the U.S. dollar) reflects the upward trend of encrypted assets. The market value of Tether has risen by about 190% in 2021, the price of Ethereum has risen by 280%, and the Bloomberg Galaxy Encryption Index's nearly 130% increase is mainly due to the relatively poor performance of Bitcoin, which has increased by nearly 30%.

Ethereum's rising dominance. In our view, Ethereum's gaining dominance and Bitcoin's decline represent a dichotomy between cryptocurrencies, and it is a persistent trend. Ethereum is a key building block of financial digitization, and Bitcoin is more of a macroscopic replacement of gold in investment portfolios. There are not many smart contracts or tokens that can be built on Bitcoin, but it is developing into a digital reserve asset in this direction. The figure below depicts the market capitalization of Ethereum as a percentage of the total market capitalization.

                         
3. Bitcoin is dormant, stronger, and more environmentally friendly

What happened to Bitcoin? It will be more powerful, more environmentally friendly, and less scalable. In our view, the reason for Bitcoin's rebound is the continuation of the bull market and the inevitable path to $100,000. The market was a bit overheated in April, and a major factor in the correction of cryptocurrencies-excessive energy use-represented the strength of the world's largest decentralized network. China's restrictions have instead promoted the benefits of Bitcoin and shifted energy to renewable energy.

In 2021, Bitcoin's fundamentals are solid. At the end of 2020, the historical trend of Bitcoin indicates that cryptocurrency will rise sharply in 2021, which is indeed the case. Bitcoin has risen by about 35% on May 24 this year, and it has become a bit too high near 65,000 USD, but under the background of falling about 50% from the peak, it has received multiple levels of support below 30,000 USD.

The chart below depicts a key part of Bitcoin's fundamentals in 2021: In 2020, compared with most major asset classes (especially the S&P 500 Index), 260-day volatility has fallen to its lowest level ever. Coupled with last year's supply reduction, migration to institutional portfolios, Ethereum futures, and the launch of ETFs in Canada and Europe, we believe that Bitcoin has a greater potential to move toward $100,000 than it is to stay below $20,000.

                         

The 100,000 USD in 2021 is in line with the standard. The chart below depicts the potential path of cryptocurrency towards resistance of approximately $100,000. Similar to the sharp rebound in 2013 (55 times) and 2017 (15 times), the supply will be reduced in 2021. The 2020 halving took place in the context of unprecedented global fiscal and monetary stimulus measures and institutions' preference for Bitcoin distribution. For most of the past decade, the possibility of cryptocurrency becoming a digital reserve asset and maintaining its planned path has grown.

                         

Another point of support comes from people starting to recognize new asset classes. Gold may be losing its importance, so diversification may only be a prudent approach.

What made Bitcoin reach 100,000 USD? ¡ªFollow Ethereum. If Bitcoin catches up with Ethereum's performance in 2021, then the number one cryptocurrency will move towards $100,000. The chart shows that as of May 24, the Bloomberg Galaxy Encryption Index (BGCI) has risen by about 110%, of which Ethereum has risen by 230%. In contrast, Bitcoin's approximately 30% increase appears to be relatively stable. Speeding up, staying the same, or reversing are three possible options, and we see about two-thirds of the likelihood that it tends to: BGCI rises.

                         

Ethereum may represent the next level of innovation, surpassing the technology-based Nasdaq index. As the cornerstone of the cryptocurrency market and financial technology, the second-ranked cryptocurrency is becoming more and more glamorous. With the decline in the supply of Ethereum, financial technology is rapidly digitizing. Coupled with the shift to consuming less proof-of-stake, the foundation of Ethereum has gradually stabilized.


(This article is from Bitpush.News)
Compared with the scale of the cryptocurrency market a few years ago, the $2 trillion valuation is huge, and it seems that there is still a lot of room for growth. Trillions of dollars in pension funds, trust funds, and brokerage accounts cannot enter the cryptocurrency market. Once these funds are invested, the crypto market may soar to record highs.

                         

In the past two years, the valuation of the cryptocurrency market has risen from about 100 billion U.S. dollars to more than 2.5 trillion U.S. dollars, a substantial increase that has never been seen in history. It has risen by 2500% in less than two years, but it has also made many investors wary of future price potential.

Currently, the only way to buy cryptocurrency is through exchanges such as Coinbase, Binance, and Kraken. Even if there are trust funds like Grayscale Bitcoin and Ethereum Trust Funds or Bitwise's 10 Crypto Index Fund, their premiums are high, sometimes as high as 100%. This means that if someone wants to buy 100 US dollars of Ethereum through one of the trust funds, they need to pay about 200 US dollars. Therefore, for any investor who values ​​their own funds, the main way to buy cryptocurrency is through an exchange.

                         

Ordinary retail investors may have no problem creating a Coinbase account and buying $100 in Bitcoin, but for multi-billion-dollar institutions and hedge funds, due to regulatory, risk, and custody difficulties, using Coinbase is not an option at all. Instead, they are more willing to invest in exchange-traded funds (ETFs), which use Bitcoin as their main asset and are traded on traditional stock exchanges such as NASDAQ. Ideally, this would also prevent hacker attacks and other black swan incidents.

There is currently no cryptocurrency ETF for US investors, but in the future investors are very likely to purchase cryptocurrencies through Charles Schwab or Fidelity accounts. Trading cryptocurrencies on traditional exchanges will be a huge opportunity for the market, because trillions of dollars will now be poured into this asset class.

                             

For example, there are currently 50 trillion U.S. dollars in retirement funds, and the top 500 companies have an annual income of 33 trillion U.S. dollars. If these funds and companies can obtain cryptocurrency and hope to invest 10% of their shares and income conservatively in this asset, it will be $8 trillion, more than four times the current valuation of the entire market.

                                

The growing market capitalization will not only increase the value of cryptocurrencies, it will further legitimize them and allow larger investors to participate. When Bitcoin was worth only $10 million, it was seen as an interesting internet experiment. When it reached $1 billion, it began to look like an interesting investment, but no one could invest more than a few million dollars without drastically adjusting the price. When it exceeds 1 trillion US dollars, investors and companies all over the world regard it as the future of currency, which can buy and sell billions of dollars without price fluctuations. If Bitcoin reaches 10 trillion U.S. dollars, it is likely to become the world's reserve currency, which will allow companies and funds to invest hundreds of billions of dollars in this asset with greater confidence, promote its growth, and further legitimize its status.

                            

Although there is no guarantee that large foundations will buy cryptocurrency, they are definitely interested, which is why there are many cryptocurrency ETF apply that are awaiting approval from the US Securities and Exchange Commission. Even the most conservative investment will be a huge signal that the institution wants to put cryptocurrency into its holdings. If there is enough time, the market value of cryptocurrency can easily double, triple or quadruple.  It is uncertain when cryptocurrencies will start trading in the traditional market, but people think it is inevitable and it will bring a new era in the history of digital assets.


(This article is from Bitpush.News)
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