The bitcoin price has surged about 300 percent over the last 12 months thanks to mainstream adoption and institutional interest. It has rallied massively to surpassing all-time highs of $41,000. At the time of this writing, the price is hovering around $35,000 and it will be interesting to watch traders’ reactions and price behavior for the rest of 2021.
The Bull Run Will Likely Continue
Bitcoin’s bull cycle will likely continue, especially in the second half of 2021. One of the causes of price increase will be widespread adoption. Currently, relatively few people accept and use Bitcoin in everyday life. However, we could see mainstream acceptance in the coming months. For instance, PayPal has allowed its users to buy and sell bitcoin using PayPal accounts. Also, Square invested $50 million in bitcoin. Ongoing mainstream adoption like this could boost bitcoin’s price significantly.
The liquidity in bitcoin has been a telltale sign that more institutional bodies are at play. Similarly, throughout 2021 the institutional interest is expected to drive the prices of bitcoin and other cryptocurrencies.
In another sign of the mainstream growth of cryptocurrencies expected in 2021, major cryptocurrency exchange Coinbase is expected to become a publicly-listed company this year. The exchange’s institutional assets increased from $6 billion to a whopping $20 billion between April and November of 2020.
Caused by the U.S. dollar’s cyclical bear market and global liquidity, bitcoin will benefit significantly from people hedging against inflation. Many retail traders will also jump in due to the fear of missing out (FOMO), pushing the price further. Traders who will not want to invest directly in bitcoin will trade contracts for difference (CFDs) on bitcoin via forex brokers and trading platforms.
As mentioned above, in October 2020, PayPal announced that it would support buying and selling…