Bitcoin Soared During 2021, Helped by the Choices of Tesla
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The price of bitcoin, hitting an all-time high of around $70,000 per bitcoin in November, has since crashed back, losing nearly 40% of its value and wiping $1 trillion off the combined crypto market.
Now, Wall Street giant Fidelity has said that other countries and even a central bank could follow El Salvador and Tesla in bitcoin this year – predicting that bitcoin will hit the bottom when the price drops. Buy “will be competitively better than your peers.”
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“There is a lot of bets game theory at play here, so that if bitcoin adoption increases, some bitcoin safe countries today will be better off than their peers,” wrote Fidelity analysts Chris Kuiper and Jack Neuter. A Comment“They wouldn’t be surprised to see other sovereign nation states acquire bitcoin in 2022 and perhaps even see a central bank take over,” he said.
“I certainly agree with Fidelity, but it’s still surprising to read this kind of mainstream financial reporting on game theory for bitcoin adoption,” said bitcoin advocate Alex Gladstein, chief strategy officer at the Human Rights Foundation. said via twitter,
In September, El Salvador replaced bitcoin with the US dollar as its official currency and began buying bitcoin. This year, the country has said it will buy another $500 million worth of bitcoin, funded by issuing $1 billion worth of tokenized bonds, and is planning to build an ultra-low tax “Bitcoin City”.
Politicians in other countries are watching El Salvador’s bitcoin experiment for signs of success and some have said they would consider a similar move if it pays off.
This week, the mayor of Rio de Janeiro reportedly said that he plans to allocate 1% of the city’s treasury reserves to cryptocurrency, while the US mayor of Miami, Francis Suarez, said last year that he plans to allocate 1% of the city’s treasury reserves to cryptocurrencies. Some want to keep the treasure in bitcoin. ,
Meanwhile, Elon Musk’s Tesla Follows Business Software Company MicroStrategy
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“Even if other countries do not believe in the investment thesis or adoption of bitcoin, they will be forced to acquire something in the form of insurance,” wrote the analysts at Fidelity. “In other words, paying a small cost today can be used as a hedge against potentially much higher cost years in the future.”
The price of bitcoin has risen nearly 400% since this time two years ago, with the combined crypto market growing from nearly $200 billion to $2 trillion. However, the price of bitcoin remains highly volatile, crashing 40% from its peak twice last year, even as Wall Street analysts predict an increase in bitcoin and crypto adoption.
Bitcoin and Cryptocurrencies Poised for More Acceptance from Mainstream Investors and Companies This Year, JPMorgan
Bitcoin is “particularly well-designed as a modern store of value, and the robust design has contributed to an increase in the value and trust of bitcoin,” wrote Worthington, predicting 2022 “of the blockchain bridge.” The year will be “the year of financial tokens (driving greater interoperability across different chains).”