Cryptocurrency market reaches $1 trillion for the first time
The latter half of 2020 was a monumental growth period for cryptocurrencies, and that momentum has continued at the beginning of 2021. Various institutions have started accepting cryptocurrency, making them more useful and valuable than ever before. Both individuals and institutional investors have been investing heavily in Bitcoin, smashing through records and hitting an all-time high of $37,800 per Bitcoin (at the time of writing).
The involvement of major banking and capital fund institutions may be a tipping point for cryptocurrencies, making them mainstream and usable in multiple ways. Bitcoin has been the spur the industry needed to reach a $1 trillion valuation for the first time, with the largest crypto making up almost $700 billion of that valuation. Many think cryptocurrencies, perhaps specifically Bitcoin, will start to compete with gold as an investment vehicle, with gold at a current market cap of about $9 trillion.
Other cryptocurrencies are also growing in popularity, also driven by traditional financial service providers starting to offer its customers new ways to trade crypto. More people than ever are choosing alternative cryptocurrencies over traditional assets like gold or bonds, while large institutions are still mostly focused on Bitcoin.
The $1 trillion mark is a big milestone, with long-time advocates of the industry signalling this as simply the beginning of a larger revolution in finance. The last major boom was towards the end of 2017 when it hit a market cap of $814.3 billion before retreating significantly. A lot has happened in the industry in the interim that leads many to believe crypto is here to stay and will remain a major part of our financial systems.