Although the price of bitcoin fell recently, it has still managed to be one of the best performing financial assets of the year. The cryptocurrency has managed to have an amazing year in general, reaching all-time highs twice during the year.
Over the year, the cryptocurrency first reached an all-time high during the Spring, when it was selling for almost $64,000, followed by another all-time high of Fall, with over $69,000. The cryptocurrency managed to perform better than assets such as the US benchmark index, S&P 500 as well as gold.
Recently, Arcane Research published findings, which saw that the year-to-date performance of the largest cryptocurrency in the market, BTC, managed to be almost a 73 percent increase. Compared to other assets in the financial industry, this was an amazing performance.
For example, S&P 500 index only managed to surge 28 percent, while gold dropped by 7 percent during the same period. As a result, BTC managed to have a third consecutive year to outperform the other two financial assets.
Market experts are talking about numerous reasons why the cryptocurrency managed to have such an amazing performance. While some are saying that the performance of the BTC was mainly influenced by the buzz around the crypto industry in general, others are talking about reasons such as higher inflation around the world.
For example, recently, it was announced that the consumer price index, CPI, of the United States, had the largest increase of 12 months compared to the past four decades. In fact, Arcane’s report claims that the majority of the experts did not predict the inflation to be this high, saying that managing to showcase such a great increase, BTC proved to be an excellent hedge for inflation.
Bitcoin Popularity Increased
Around the world, crypto popularity increased dramatically. People around the world saw cryptocurrencies as an amazing tool to start investing as well as sending and receiving funds around the world.
Many large organizations and mainstream financial houses around the world started launching crypto-supporting investment opportunities. According to the report of Arcane, the popularity of cryptocurrencies, as well as ETFs, has grown dramatically globally, offering individuals high-quality investing opportunities. Such increased popularity has increased demand for crypto and bitcoin platforms for investments.
While bitcoin had an amazingly successful year, it also had some periods of high volatility over the year.
Many financial experts and analysts believe that such high price fluctuations and volatility get in the way of the further development of the BTC and give it an ideal inflation hedge. Arcane also focused on the high volatility of the cryptocurrency, saying that it was a lot more volatile than the S&P 500 in 2021. According to them, BTC was very much like a risky asset, and it could have caused numerous challenges for individuals if they were not ready for such volatility.
What Makes Cryptocurrencies So Popular?
The popularity of the cryptocurrency market has been increasing around the world very fast. People of all different backgrounds are showing interest in this ever-changing industry, which has already proved to be an amazing investment opportunity for numerous different reasons.
First of all, one of the biggest characteristics of the crypto market is that it provides traders of all different interests the opportunity to make profits, while others can use digital assets for sending funds around the world.
Over the years, numerous crypto exchanges have been established, offering individual investors the opportunity to invest and make profits from the cryptocurrency price movements. Thanks to these exchanges, making profits from the cryptocurrency trading market is easier than ever before.
All it takes to become a crypto trader today is to open an account with one of the crypto exchanges in the market. The best thing is that traders do not even have to have much understanding of the market, they can simply start trading using automated trading robots and make profits automatically.
By using one of the available automatic trader bots for investing in bitcoin, it is a lot easier for crypto traders to do extensive market analysis. It should not take traders much time to analyze the price movements in the market using automated trading bots.
Also, the crypto bots are also able to trade cryptocurrencies for you, giving traders the opportunity to always stay connected with the market to ensure they do not miss out on profitable market conditions.
Crypto enthusiasts are able to use different types of trading options when it comes to BTC trading. For example, you can use one of the crypto exchanges to buy and sell cryptocurrencies and make profits from the price differences. On the other hand, some traders are using different types of contracts to profit from price movements in the market, for example, CFDs.
2021 was very important for the crypto trading market, as it has managed to grow dramatically. One of the most important developments for the crypto industry, and specifically BTC, was the fact that bitcoin managed to outperform stocks and gold and it happened for the third year. The expectations for the upcoming year are very positive for the crypto industry.
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