Two twin sisters. In 2021, the curves of the course of the oldest cryptocurrencies resemble, according to the specialized site Bitstamp, an echo whose little music begins to register in the ambient hubbub of speculation. As a prelude, there was first the peak of mid-April, at more than 64,800 dollars per token struck with the capital B, crossed out like the dollar, emblem of a decentralizing technology which promises the emancipation of all central power. Bitcoin, this digital asset created in the aftermath of the 2008 financial crisis, is experiencing its strongest growth, at +450% over one year. Then, seven months later, in November, repeated twice. A twin curve to the previous one thus again taunts the world of traditional finance, at nearly $70,000 each.
If, in 2021, the bitcoin does not yet manage to completely rid itself of its reputation as a volatile asset, it is clear that since its creation by the mysterious Satoshi Nakamoto, the curve, – since December 2020 – is never again dropped below the $30,000 threshold. Now, spectacular bubble scenarios, like the one in 2019 (going from $20,000 to just over $3,000 in just a few months), seem to be dissipating.
Better, the one that some regularly compare to the ounce of gold in the era of dematerialized exchanges, is establishing itself as a safe haven in the midst of the Covid-19 crisis. A weapon of protection against galloping inflation carried by the influx of liquidity from central banks, it brings with it its challenger, the Ethereum, not to mention the rising value, the Solana, and the string of 12,000 others cryptocurrencies, listed by the CoinGecko website. While the capitalization of bitcoin reached more than a trillion dollars during the year, that of the whole market fluctuates between 2,500 and 3,000 billion dollars.
Thus, at the end of the first half of 2021, 221 million people worldwide held cryptocurrencies, a number more than doubled compared to January (106 million), according to a study by the specialized exchange crypto.com. Results, it’s the rush on the cryptocurrency exchange platforms whose valuations (some listed on traditional indices) are soaring.
The asset, which rewards – via blockchain technology – the one who makes it his computer production thanks to to “mining”, also benefits from technical effects linked to its rarity (only 21 million bitcoins can be issued by networked computers.)
Musk-the ambassador, personality of the year according to “Time“magazine
In 2021, while confined eyes are riveted on the screens of stock market prices, bitcoin and cryptocurrencies are on everyone’s lips. And not just any. The richest man in the world, Elon Musk, at the head of a fortune estimated by Forbes at more than 260 billion dollars, regularly ensures the communication campaigns on Twitter of these new assets which are exchanged peer to peer. . ” I imagine the fundamental purpose of cryptocurrencies is to reduce the power of centralized governments, and they don’t like that.”, the entrepreneur joked in September about China. It is also no coincidence that, at 50, the boss of Tesla and Space X, was named personality of the year by the American magazine Time.
Similarly, Jack Dorsey left the management of Twitter to focus on his digital payment company, Square, which he renamed Block, and where he plans to develop his cryptocurrency activities.
Bitcoin is also still the source of gigantic fraud cases, either because of unscrupulous entrepreneurs like the record of the year in South Africa, or to demand a ransom (finally traced on the blockchain), as during the hacking of the Colonial Pipeline oil servers in the United States.
Currency control more pressing
Still recently described as the asset of criminals and terrorists by governments, in the face of its growing popularity, Bitcoin and the others are more directly threatening the monetary sovereignty of states. And to ask even more the question in 2021: who has the power to mint money, when the Tech giants are eyeing – too – the immense market of decentralized exchanges in the future “Web 3.0”?
A question to which certain States answer by leaving no ambiguity: none, except the State. A few weeks apart, China, the former Eldorado for mining, and India, whose young people love these new active ingredients, close all the floodgates by prohibiting transactions.
Conversely, the small state of El Salvador is betting on bitcoin to increase the banking rate of its population and facilitate money transfers with its diaspora in North America. Moreover, in Miami or New York, businessmen have made bitcoin an issue of attracting investment and new talent. The “Big Apple“wants to build a new sector.
The dubbing of financial actors
As a result, between the white-collar workers of Wall Street and the first bitcoin “geeks” who became decentralized finance or “DeFi” entrepreneurs, the transplant began to take hold.
The interest of big names in new technologies and finance, which until now had kept away from this technology, is growing. Goldman Sachs, the giant black rock, Ihe investment bank Morgan Stanley, which indicated in March that it would allow its wealthiest clients to invest in bitcoin funds… Wells Fargo, Citigroup and Bank of America all indicated at the end of May that they were in the process of to look into the matter.
From now on, on Wall Street, index funds can be linked to bitcoin prices.
“We expect the adoption of digital assets by institutional investors and their integration into the traditional financial system to further push the crypto market next year,” Loukas Lagoudis, from the investment fund, told AFP. in ARK36 cryptocurrencies.
The risk of regulation in 2022
However, 2021 will not have resolved the issue of the regulation of bitcoin and cryptocurrencies. While the market is growing especially in the United States, regulators prefer to temporize, thus offering a few steps ahead to a technology that consumes too much electricity and whose computer protocol is still constantly updated. For now, theis mine from bitcoins would consume about 114 TWh (terrawatt-hours) on an annualized basis, or 0.5% of global electricity production, or a little more than the consumption of the Netherlands, according to a Cambridge study bitcoins electricity consumption index (CBECI) published in 2021.
“Bitcoin’s reluctance to change its model is, in our view, one of the characteristics that makes it stable and consistent, which is necessary for a truly global currency,” observes Frank Downing, analyst at ARK.
This project of a world currency freed from all control is not to the liking of central banks, whose urgency is now to offer an alternative to bitcoin and its competitors. Since the acceleration of the Web giants and Facebook’s first work in 2018 on Libra (now Diem), central banks seek to materialize their “CBDCs” (Central Bank Digital Currencies). Thus, Thursday, December 16, the Banque de France announces that it has “successfully” concluded its nine experiments relating to a central bank digital currency in the context of interbank exchanges.
2022 will therefore again see the risk of action by the regulator. In France, a presidential election year, pro-bitcoin lobbying is on the rise. Among the presidential candidates, some are also learning about the subject.
“There is never certainty when it comes to crypto, let alone regulation. But one thing is certain, the voices calling for more regulation of cryptocurrencies are going to be louder and louder.“, concludes Huong Hauduc, of the Bequant exchange platform and quoted by AFP.