Important facts:
Bitcoin achieved a 60% return in 2021, double that of traditional assets.
Bitcoin appreciated 11.42% in the fourth quarter of 2021.
Mercados al día is an exclusive round up of the news that is moving the Bitcoin economy. It is pre-emailed to a subscriber list and then published on CriptoNoticias every Monday. If you’d like the information ahead of time, subscribe to the list here.
Bitcoin ended 2021 with a return of 60% after hitting an all-time high of nearly $ 70,000. For various analysts and traders, however, Bitcoin has not yet reached the maximum value of the current upward cycle that was expected by the end of this year.
With this annual performance, Bitcoin showed a much higher increase in value than traditional assets, as reported by CriptoNoticias. The S&P 500 Index ended 2021 with a return of 29%, while gold closed in the red and plummeted 6% year over year.
November and December were months in the red for the Bitcoin price. In November the price decrease was 7%, while the price decrease in December was 18.75%. Thanks to the extraordinary price increase of 40% in October, however, the fourth quarter ended with an increase of 11.42%. In 2021, only the April-June quarter turned red for Bitcoin, with prices falling 42%.
Annual returns in Bitcoin price since 2009. Source: buybitcoinworldwide.com.
The graph shows the annual returns on the Bitcoin price. As you can see, Bitcoin has grown every year since 2009, except in 2014 and 2018. Since a logarithmic scale is used, the size of the annual candles corresponds to percentage price increases. However, the absolute price increase has been higher in recent years.
For example, this year the price of Bitcoin rose nearly $ 20,000, while the annual increase in 2017 was nearly $ 13,000. As a percentage, however, the price increase in 2017 was 1,335%, compared to the 60% appreciation this year.
In 2021, expectations of seeing bitcoin in six-digit numbers fell
At the end of 2021, Bitcoin price hit $ 46,219 according to the CriptoNoticias Price Index. Although the first cryptocurrency saw a 60% appreciation of the $ 28,972 it opened the year with, the market was expecting a higher return from Bitcoin.
Several well-known analysts and traders had estimated a closing price for Bitcoin in 2021 at over $ 100,000. CriptoNoticias pointed to the key predictions about the price of BTC that had surfaced and failed to materialize since the beginning of the year. Among those estimates, analyst Willy Woo pointed to a possible target of $ 300,000 for BTC in 2021, although he later spoke in favor of extending the Bitcoin cycle in 2022.
BTC flow to and from the Hodlers. Source: charts.woobull.com.
In a December 21 analysis by Woo, commented on by CryptoNews, the analyst defends his stance of a bullish start to 2022 for Bitcoin price. He argues that so-called hodlers, or investors with little willingness to sell, are buying back the BTC they sold last May.
Featured chart of the week
This graph shows the comparison of the companies that purchase Bitcoin for their strategic treasury reserve versus the BTC funds managed by companies that have launched spot ETFs or are directly backed by Bitcoin.
Bitcoin ETF versus companies that hold BTC. Source: charts.woobull.com.
The graph shows that while the BTCs managed by the various ETFs are showing a slightly declining trend, the BTC acquired by companies like Block.one and MicroStrategy are showing an increasing trend.
Holders keep 86% of Bitcoin money
Bitcoin holders classified as long-term (LTH) if they hold the coins for more than five months, and as short-term (STH) otherwise, control a total of 86.45% of Bitcoin money on here, according to a Glassnode report.
BTC distribution in 2021. Source: Glassnode.
LTHs control 13.33 million BTC while STHs manage 3.01 million BTC. For BTC holdings on exchanges, the total is declining, closing the year at 2.56 million BTC.
MicroStrategy and Block.one dominate on retained BTC
In terms of institutional investments, corporate acquisitions of Bitcoin continued into 2021. The strategy of accumulating BTC as a strategic reserve instead of dollars has been very beneficial for these companies.
CriptoNoticias analyzed the top five companies based on the amount of BTC they acquired on December 25th. Block.one, the company responsible for issuing the EOS cryptocurrency, is the leader with 140,000 BTC, followed by MicroStrategy with 122,478 BTC.
In far third place is Tesla with 42,902 BTC, followed by the Tezos Foundation (17,500 BTC) and Galaxy Digital Holdings (16,400 BTC).
The value of the cryptocurrency market tripled in 2021
The market capitalization of cryptocurrencies tripled in 2021, as we report in this medium. This was three times the return on Bitcoin over the same period. In early 2021, the market capitalization of cryptocurrencies was $ 766,678 million, up from $ 2.37 trillion at the end of last year. Bitcoin’s dominance fell from 70% to 40.3% in 2021, in numbers from CoinMarketCap.
Comments are closed.