It might have been better to get in around 2014 or earlier, but that doesn’t mean it’s too late now. Here are just a few of the reasons why.
Many in the industry understand Bitcoin’s halving cycles to have a compelling link to the price, thanks to the decreasing issuance of new BTC. A popular model is Bitcoin stock-to-flow, which traces the halving cycles to predict future price movements with startling accuracy.
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Based on the current halving cycle, the model anticipates seeing a six-figure BTC price by the end of 2021. Recent bearish markets have tested the model, but it has held firm.
The Bitcoin stock-to-flow cross-asset model performs the same task, with the same level of accuracy to date, but is even more ambitious in its price predictions. According to this model, BTC prices could go as high as $260,000 or more.
Predicting the future is always a risky business, but history tells us that this halving cycle looks far from done yet.
BTC has often traded sideways over recent months, but altcoins are having a moment in the sun. In particular, many platform tokens have undergone epic growth in 2021 as projects several years in development launched mainnets.
One example is Polygon’s MATIC token, which sailed into the top 20 cryptocurrencies in April thanks to a slew of adoption news. Cardano’s ADA and Solana’s SOL tokens have recently undergone unprecedented rallies, posting impressive year-to-date gains above 1,500% and 8,000%, respectively.
Unlike the early days of crypto, there’s now a flourishing financial infrastructure to support the digital asset space. One advantage this offers to holders is many more opportunities to generate returns on your cryptocurrency investments.
Active traders can now find an array of regulated, secure trading platforms, while more passive investors can generate profits from staking or lending. For those with an appetite for a little more risk, there’s DeFi’s interest-earning liquidity and lending pools. Regardless of which you choose, you’ll invariably benefit from a higher interest rate than you’d get by holding fiat in a bank account.
On the subject of DeFi, the Cambrian explosion in decentralized finance is another area of crypto where the party is only just getting started. Not only is the value of the funds locked in DeFi increasing exponentially, but investment is pouring into the space at an unprecedented rate.
Now, it seems that the next development in DeFi will be institutional participation. If this is the beginning of an institutional love affair with DeFi, we can expect to see plenty of further news from the space, as well as more investment flowing in.
It’s tempting to get skeptical about NFTs when you see the headline-grabbing sums exchanging hands for pixelated artwork or cartoon cats. But looking past the hype, NFTs are generating such excitement precisely because they’re a nascent technology that shows vast potential.
In particular, within regulated digital securities markets like Switzerland, NFTs allow the tokenization of all kinds of assets, standard and exotic. Concert and event tickets, real estate, fine wines, a digital movie poster—all can be tokenized and traded in blockchain-based marketplaces.
At the end of 2020, when Bitcoin sailed past its previous all-time high of $20,000, it acted as a starting pistol for institutional inflow to cryptocurrencies. But we’re only at the beginning of this journey. Various surveys show that between 70% and 80% of institutional respondents plan to increase their cryptocurrency allocation over the coming years.
Future institutional adoption is perhaps the best indicator yet that it’s not too late to get into cryptocurrencies. Institutional investors have large appetites, and much of the cryptocurrency economy is designed around supply and demand. With the increasing demand and limited flexibility in supply, the forces are in play for plenty more price action.
Overall, the future has never been brighter for the cryptocurrency sector. Despite all the strides over the last decade, there’s still vast scope for future development and expansion in these relatively young markets. As such, it’s definitely not too late to dive in.