Bitcoin and other cryptocurrencies have had a very volatile journey in the last couple of years. While the prices of bitcoin, ETH and several other cryptocurrencies touched their all-time-highs around March-April 2020, a significant drop in the prices was recorded in the following months, which led to a crash of the crypto market. But, the good news is that crypto markets are again on a growth track, and we expect at least some of our favourite cryptocurrencies to achieve record highs this year. So, let’s talk about the biggest and most significant crypto market trends of 2021.
One of the trends that we have observed in the past year or so is the growing number of beginners investing for the first time in cryptocurrencies. This trend shows that people are beginning to understand the significance of digital currencies and their importance as an alternative to traditional asset classes, not only for higher returns but also for a secure financial future.
Another trend that is hard to miss is the growing investor interest in new, lesser-known cryptocurrencies that allow traders to not just diversify their portfolios but also invest in high-potential, futuristic assets.
Trend #1 - Remarkable growth in crypto markets
Whether this was because of the COVID lockdowns or some other reason, many more investors over the past year made their debut in crypto markets, which led to an outstanding increase in the popularity and performance of the global crypto markets.
Also, in terms of returns, cryptocurrencies have historically beaten almost all other asset classes. For example, Bitcoin received a growth of over 100% between January and April 2021, in a span of less than 4 months. Not just bitcoin, many newer and smaller cryptocurrencies also registered significant growth during this period. Libra Coin - eCommerce focused digital currency - for example, has registered a 100% growth since its launch last year.
On the other hand, most of the traditional markets including stocks and gold were seeing a decline caused by the COVID pandemic in this period.
Trend #2 - Entrance of new players in the market
As the crypto market has become very popular over the years, many new digital currencies are being launched lately. And many of these currencies and projects are really good for the long term. Over the past couple of years, more than 2,000 new cryptocurrencies were created and ICOs were launched, many of which became immensely popular. This has led to a tremendous increase in crypto investing activities while providing traders with numerous options to choose from, based on their particular preferences and understanding of the crypto market.
Trend #3 - Bitcoin is no longer the king
Even though BTC continues to remain the number one cryptocurrency in terms of market cap, investors have realized that it is not the only cryptocurrency they could invest in. With the hope to diversify their portfolios as well as try out new markets, crypto investors have lately started investing in cryptocurrency beyond bitcoin. Some of the most popular altcoin choices for investors include ETH, DOGE, XRP, TRX, ADA, BNB, and others.
Diversifying your crypto portfolio is a great way to reduce risks and increase your profits.