In its first 10 years, Bitcoin (BTC) was speculative. People treated it as a collectible or digital gold of sorts.
Some thought it could transform the global economy, and that vision seems to be coming to reality.
Now, BTC is in an investment stage, where monetary supply issues and the pandemic come together to drive investors towards safety and massive potential growth.
As we head into 2021, how will BTC evolve to serve the needs of individuals and companies? Here are three key trends for the coming year:
1] Individual Security Against Volatility in the Traditional System
It is sufficient to say that 2020 has been a volatile year for the traditional financial system. One of the more alarming developments of the year was the revelation that the Fed printed an incredible amount of money over the last year. Over 20 percent of all dollars printed in the history of the United States were printed in 2020 alone, leading to fear of hyperinflation and further instability.
For individuals depending solely on the traditional financial system, there aren’t many options from the government or institutions to provide cover and mitigate exposure to this volatility. BTC, on the other hand, is on an aggressive growth trajectory. Unlike dollars, which can be printed indefinitely, there is a finite supply of about 21 million BTC. Of that 21 million, about 4 million is estimated to be lost forever, and millions more have been lying dormant. For this reason, BTC has been referred to as a “digital gold,” referring to the days when the value of the dollar was directly linked to the fixed supply of gold in federal reserves.
What does this mean for the individual? Despite its reputation for volatility, BTC could at times prove to be a more stable alternative to the dollar. The scarcity of BTC compared to the printability of dollars is likely to attract savvy individuals looking to diversify their assets in the event of a lapse in the traditional financial system. As the adoption rate of BTC increases and the supply remains constant, the value of BTC will only continue to rise.
2] Increased Volume and Underbanked Opportunity
BTC has no geographic boundaries and features transparency of ownership. For underbanked groups that have limited or no access to traditional financial instruments, BTC offers multiple advantages. It allows them to avoid various antiquated retail transactions involved in their everyday life, such as buying prepaid cards, sending remittances through legacy money remitters, using bill pay services, and buying money orders. All of these types of transactions can be replaced by using BTC from the comfort of your home using a mobile bitcoin wallet app.
BTC gives underbanked individuals flexibility to use the cryptocurrency as an investment, which for many is a new concept considering they have never had easy access to traditional markets. This makes BTC a valuable financial tool to increase the buying power of a previously unbanked demographic, creating a new potential market for businesses impacted by the pandemic. It can even give people access to micro-lending opportunities to help them open or invest in a small business, so they can capitalize on the expected economic recoveries in 2021. A summer 2020 study found cryptocurrency adoption occurs four times faster in undeveloped countries, underscoring its appeal for marginalized and underbanked groups.
And the value of BTC in the long-term is almost guaranteed to rise due to limited supply, which makes it attractive for underbanked populations and any other traditional investors, especially when compared to fiat currencies subject to crippling inflation and unlimited supply.
3] Better access to physical bitcoin ATMs
The proliferation of Bitcoin machines also known as bitcoin ATMs will also continue throughout 2021 as adoption and acceptance reach the mass market. Fast-growing firms like Bitcoin Depot and others provide a worldwide network of more than 10,000 bitcoin ATMs near you and are bringing bitcoin to the masses. Bitcoin Depot is rapidly installing its BTMs™ to provide the public with simple, quick, and convenient access to bitcoin and other cryptocurrencies. With expanded access to BTC through Bitcoin Depots BTMs™, users can make online purchase and send money abroad to family and friends more easily than existing methods. There’s no barrier to entry, as new users can sign up at the company`s BTMs™ in about a minute and begin buying BTC at their discretion.
Payments made with BTC will become more commonplace in 2021, as merchants will want to gain exposure to BTC-holding customers, and payment processors desire a new type of innovation. There will be a rapid adoption of “crypto cards,” which will enable users to spend bitcoin through traditional payment networks and have the payment networks pay merchants in fiat currency. In July of 2020, the Office of the Comptroller of Currency (OCC) granted banks the ability to hold crypto assets on behalf of customers, signaling that mainstream acceptance of BTC has begun, and that BTC is beginning to revolutionize the economy as we know it.
BTC is moving out of the early adopter phase, with big players choosing it as a hedge against traditional markets, and consumers beginning to use it for everyday life transactions. Soon enough it will become a core part of every investment firm`s portfolio and a common payment method. In 2020 and beyond, BTC will be impossible to ignore.
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