The world’s largest cryptocurrency Bitcoin witnessed an amazing year even with the hindrances it encountered. From hitting newer milestones, to gaining wider acceptance, Bitcoin sure had many noteworthy moments this year.
The cryptocurrency has become very instrumental in today’s financial system, promoting both a cashless society and giving people independence over their monies.
Let’s take a look at some of the memorable things that happened to the biggest cryptocurrency this year.
Bitcoin Surpassed $20,000 At The Beginning Of This Year
This year was a huge stepping stone for Bitcoin. Prior to this year, Bitcoin didn’t have as much buzz as it does now. The cryptocurrency was trading below $20,000 until it set a new milestone of $20,600 on the 16th of December 2020. The cryptocurrency wasn’t expected to surpass this new milestone in quite a long time as it took the cryptocurrency years to attain the milestone. The following weeks, months, that followed saw Bitcoin hit newer milestones. Bitcoin surpassed the $20,000 mark it set in December 2020 and continued to soar, doubling in less than ten weeks!
The next weeks and months that ensued saw Bitcoin break even newer grounds.
Electric Vehicle Company Tesla Adopted Bitcoin As A Means Of Payment
In March, following a February announcement that it was going to start accepting Bitcoin as a means of payment for electric vehicles, and an investment of $1.5 billion, electric car maker Tesla started accepting Bitcoin as a means of payment. The announcement sent the price of Bitcoin flying over the roof! Bitcoin was receiving a lot of attention; everyone wanted to partake in it.
Following Elon Musk-owned electric vehicle company Tesla’s adoption of Bitcoin as a medium of exchange for Tesla cars, Bitcoin set new boundaries. Eventually, other companies also began to adopt Bitcoin into their operations.
Bitcoin Hit $1 Trillion In Market Capitalization
The weeks that ensued after December 2020 saw Bitcoin soar astronomically. The world’s biggest cryptocurrency hit a new market cap of $1 trillion dollars after hitting a new price of $55,000. Prior to that, it had a market cap of $970 billion and was trading around $50,000. One Bitcoin was worth about $28,700 in December 2020, and in such a short time, the cryptocurrency had doubled in value.
Bitcoin’s sudden surge was influenced by quite a number of factors and investments from companies. Electric car company Tesla invested in Bitcoin with the sum of $1.5 billion and started accepting the cryptocurrency as a means of payment. America’s oldest bank BNY Mellon also started trading cryptocurrency for its client. Payments companies like Mastercard began to accept cryptocurrencies on their platform. Even mobile payment apps joined the train to accept Bitcoin as a means of payment.
Donald Trump Criticised Bitcoin, Called It A Scam
As Bitcoin continued to gain more acceptance, so did the criticisms against it continue to rise. From sceptics who said Bitcoin was only an item for barter to others who said it was overrated, no stone was left unturned in terms of criticizing the cryptocurrency.
One noteworthy critic of the cryptocurrency is Donald Trump, former President of the United States of America. According to him, Bitcoin was a huge scam and a currency completely based on thin air. In his months-old interview with Fox News, the former President specifically said that “Bitcoin, it just seems like a scam. I don’t like it because it is another currency competing against the dollar. Essentially, it is a currency competing against the dollar. I want the dollar to be the currency of the world, that’s what I’ve always said”…
Irrespective of these never-ending criticisms, Bitcoin continued and continues to thrive.
China Branded Bitcoin An Enemy, Crackdown Actions Swept Off Over $300 Billion Worth of Cryptocurrency
This year, Bitcoin had a tough time with the Chinese government. China, which was once a paradise for Bitcoin and its associated activities, became hell after authorities took on crackdown actions against Bitcoin in the country.
The crackdown actions against Bitcoin and other cryptocurrencies wiped off more than $300 billion from the market.
Eventually, Bitcoin became declared illegal and up till today, Bitcoin remains banned in China.
A Research Team At Standard Chartered Forecasted Bitcoin Reaching $100,000 By Early 2022
Bitcoin has had numerous predictions this year. While some came to pass, others fell through for a lot of obvious reasons. In September, however, a research team at Standard Chartered forecasted Bitcoin reaching $100,000 by early 2022. While Bitcoin has reached an all-time high of $69,000 and is currently trading at $50,599.60, as of the time of drafting this article, we’d have to wait a few more weeks to see if this would be one of the numerous predictions that fell through or the few that eventually happened.
Iran Lifted The Ban On Bitcoin Mining
Bitcoin mining operations resumed in Iran after over four months of no mining operations in the country. Mining activities were initially placed on hold because of the challenges the country had with power. It is widespread knowledge that Bitcoin mining consumes a lot of power, Iran had to put a pause so as to be able to manage the power situation in the country.
The ban which was instituted in May was lifted in October and a go-ahead was given to all licensed farms and miners to continue their mining operations.
For The First Time Ever, The US Beat China To Become The Top Destination For Bitcoin Miners
The year has been quite a tough one for Bitcoin and its miners as they faced strict laws, regulations and eventually a ban from the Chinese government. Data from Cambridge University released in October crowned the US as the top destination for Bitcoin miners following the long hassle between the Chinese government and Bitcoin miners. China which was formerly a haven for Bitcoin miners became a literal hell following the series of crackdown actions that forced miners to either shut down operations or move out of the country. Thanks to these, the US soared to the forefront of the mining industry. Miners have moved or are moving to the US for a number of obvious reasons. A handful of American states have some of the world’s cheapest energy prices. Besides this, the US flourishes with renewable power sources and is therefore not dependent on one or a few power sources.
El Salvador Adopts Bitcoin As A Legal Tender
This year, in what came as a huge unexpected surprise, Central American country El Salvador adopted Bitcoin as a legal tender. This means the cryptocurrency is being used alongside its official currency – the United States dollar, as a means of payment. In June 2021, the Central American country first announced that it would be introducing Bitcoin into its mainstream economic system. In a video broadcast, El Salvador’s President – President Nayib Bukele, announced that El Salvador was partnering with Strike, a digital wallet company, to build the country’s modern financial infrastructure using blockchain technology.
The move was highly criticized by monetary bodies, some citizens and neighbouring countries but all these haven’t made the country’s decision-makers bulge or rescind its decision of making Bitcoin a legal tender.
The country subsequently announced that it was going to exempt foreign investors from paying tax on Bitcoin profits. This was done to encourage more foreign investments in the country. Weeks after officially launching Bitcoin as a legal tender, the country recorded 2.1 million citizens already using the Bitcoin wallet that the government issued.
El Salvador Announced “Bitcoin City”, An Entire City Based On Bitcoin
In November, El Salvador announced plans to build Bitcoin City; an entire city based on Bitcoin. According to the information from President Nayib Bukele, “Bitcoin City” will be located along the Gulf of Fonseca situated near a volcano. The idea is to make the volcano a source of power for Bitcoin mining. It is the government’s plan to provide energy for both Bitcoin mining activities and the city from the volcano. During his presentation at Bitcoin week in November, El Salvador’s President elucidated that “Bitcoin City” will be a metropolis. According to him, it won’t just be a mining hub as people would imagine. He explained that the city is going to be a fully functional city with residential and commercial areas, restaurants, an airport as well as port and rail service. The plan for the city is to be laid out in a circle with a plaza that’ll host the Bitcoin symbol located right in the middle. The city will have no income, property, capital gains or payroll taxes, according to the President.
Taproot, Bitcoin’s Biggest Upgrade In The Last Four Years, Went Live
Bitcoin’s highly-anticipated upgrade went live in November this year. Called Taproot, it is very similar to Ethereum’s Altair upgrade. The upgrade will power increased privacy for transactions as well as improved efficiency, and unlock Bitcoin’s potential for smart contracts which seeks to completely remove middlemen from the transaction scene. It is, therefore, the first step to unleashing Bitcoin’s full potentials. The Taproot upgrade is the game-changer that we all have been waiting for all this time. “Taproot matters because it opens a breath of opportunity for entrepreneurs interested in expanding Bitcoin’s utility”, Founder and Managing Partner of Bitcoin-based venture firm Stillmark, Alyse Killeen mentioned.
The Taproot upgrade is a much better successor to the cryptocurrency’s last upgrade in 2017 called “Last Civil War” and has a lot of prospects. The new Taproot upgrade has to do majorly with digital signatures. Currently, Bitcoin uses the “Elliptic Curve Digital Signature Algorithm,” which creates a signature from the private key that controls a Bitcoin wallet, and ensures that Bitcoin can only be spent by the rightful owner. According to experts, the Taproot upgrade will include “Schnorr signatures” which will make multi-signature transactions unable to be read. This way, users get more privacy for their transactions. Although the upgrade doesn’t mean that users’ Bitcoin addresses will become invisible, what it means is that simple transactions will become indistinguishable from those characterized by multiple signatures.
Bitcoin eventually hit an all-time high of $69,000 this year. Although it’s been a quite turbulent year for Bitcoin, the cryptocurrency set really admirable milestones and the wave it brought along with it can still be felt in the way payments, storing of wealth, sending and receiving money, etc., are done.
The year 2021 turned the tables around for the world’s largest cryptocurrency and more can be expected from Bitcoin in the coming year!