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2022-01-14

BTC report for 2021

Fidelity Digital Assets - the cryptocurrency wing of Fidelity Investments, which manages $4.2 trillion in assets, shared its "two positions" on the future of the digital asset space. Key findings included the behavior of miners and the adoption of the Bitcoin ( BTC ) network.

In an annual report released last week, the group shared some insights into the world of BTC mining:

"Because bitcoin miners have the greatest financial incentive to best guess the adoption and value of BTC (...) the current bitcoin cycle is far from over and these miners are investing for the long term."

The report said the revival of the hash rate in 2021 "was truly astounding," especially considering that the world's second largest economy, China, banned bitcoin in 2021. "more widespread around the world," showed that miners are focused on long-term gains.

Statements consistent with recent sales of miners. Key chain indicators show that Bitcoin miners are in " massive " BTC accumulation mode, as miners show no desire to sell .

When it comes to orange pill adoption across countries, Fidelity made some interesting predictions about more countries accepting BTC as legal tender:

"There is a very high-stakes game theory here that if Bitcoin adoption increases, countries that secure some Bitcoin today will be in a better competitive position than their peers. Therefore, we would not be surprised to see other sovereign nation states acquiring bitcoin in 2022, and perhaps even a central bank making an acquisition."

Their comments come after a former Tonga MP suggested that the country could adopt BTC in late 2022. 

Essentially, more regulation and better products will open up the crypto space, "bringing more of the hundreds of trillions of traditional assets into the digital asset ecosystem." Combined with miners, this could extend the cycle and drive BTC to new highs.