Cryptocurrency has been here for years already. Some may have doubted its growth while others believed in it. If you’re still undecided, then it’s high time to check the cryptocurrency trends this 2021. That way, you can weigh whether to trade or invest in cryptos.
Below are some of these trends:
Federal Banks Consider Cryptos
Despite the technology’s innovation, many people are still unfamiliar with cryptocurrency. Many are unaware that they can use cryptos to buy or sell goods or services. In fact, crypto investment is also possible when done right.
And these are perhaps the most significant contributing factor why cryptocurrencies aren’t dominantly adopted. Because of this, there were several attempts to improve the introduction of cryptocurrencies to people to grasp their advantages quickly.
However, cryptocurrencies will experience a twist of fate in 2022 as the federal banks begin to generate their own digital currencies. Together with the seven central banks, the Bank for International Settlements reported that they’re planning to design a structure for Central Bank Digital Currencies (CBDC).
Although the United States isn’t yet ready to welcome CBDC, Sweden and China think that it can be smarter to introduce CBDC at the soonest possible time. It has been anticipated that the CBDC’s of these two countries are going to be two of the biggest in the world.
The banks’ interest to explore the digital currency is mainly triggered after the Office of the Comptroller of the Currency permitted these institutions to utilize stable coins. Thus, more and more banks are expected to come up with their own CBDC. Having exposure to the digital world, banks can assure that the continuous technology evolution can’t leave them behind.
Furthermore, traditional financial systems are likely to be replaced by decentralized ledgers in 2021. This then may lead to many customers realizing the importance of cryptos, encouraging them to buy cryptos like Dogecoin and the like. People will then start learning where to buy Dogecoin and other cryptos as a start.
NFTs Are On The Rise
Non-Fungible Tokens (NFT) refer to non-interchangeable and unique data you can store on a digital ledger. And this is a type of cryptocurrency that can hold your digital assets like arts, virtual cats, and the like. Using NFTs for your digital assets will make your assets unique, so you can’t find any other version of it. However, its value is fluid, so it can either drop or increase.
Since NFT is a digitized technology, its characteristics have influenced a lot of customers, making it extremely popular nowadays. In fact, NFTs show significant uptakes. For instance, many people use NFT to generate overwhelming funds like the Beeple, providing a wide range of stuff being sold digitally.
To be specific, it all started with Axie Infinity and CryptoPunks. You might have known about these projects already as they’re very phenomenal. Hashmasks then came into the picture. And as time passed, more and more projects were seen such as the Ether Cards and Efinity.
Compared to other types of cryptocurrencies, NFTs don’t keep your virtual money in zeros and ones. Grimes is another popular personality that has a collection of NFTs.
With the rapid influence of NFTs on people, it has been acclaimed as the digital future for the fine art collection. Generally, NFTs are characterized as hypothetical investments. You can buy art or stocks. However, everything is digitized. Thus, the products are available in online marketplaces.
Transaction Cost Changes
Another cryptocurrency trend is the changes in transaction costs. That’s because cryptos are gaining more popularity. With this, you can expect either of these scenarios:
- Bitcoin exchanges continue to go high, or the exchange costs could drop because of the redesigning of innovations.
- Obtaining crypto brings in online stores. Compared to the fiat monetary systems, this approach proves to be more practical to manage and more affordable.
Crypto ATMs Across The Globe
With the large volume of Bitcoin ATMs worldwide, you can expect that selling and buying cryptocurrencies in the following years will be more convenient. With continuous education about cryptocurrencies, more and more people will understand the benefit of digital currencies. As a result, cryptocurrencies will become a dominant thing in the mainstream.
Crypto Brokers May Gain Popularity
While the popularity of cryptocurrencies is already taking the mainstream by storm, crypto brokers are also expected to experience their best moment this year and the following years. More crypto brokers are expected to get involved in the game and expand their products and services.
Moreover, crypto brokers will aim to attract more traders by taking advantage of the new innovative features. Many tools and software exist, so crypto brokers can gauge smartly which one works well for them. As a result, they can cater to more crypto investors.
Risk Assessment Models Are Changing
With the rise of crypto’s popularity comes more types of cryptos. This means more and more people are making their own crypto. As of today, there are more than 8,000 cryptos around the globe. However, almost 90% of them are scams or fraudulent schemes. Because of this, high-quality risk assessment models must exist.
With such, service providers are investing in models that can better analyze what cryptos aren’t in the scam industry. This means they must be able to consider the following risks:
While this is the most challenging risk to assess, transaction and user identification rules are becoming stricter. These include the ability to identify and monitor actions related to the movement of high volumes of cryptos. Service providers use data to predict changes, which depend on the sales characteristics, time, and goals. That’s because some cryptos are being used by criminals to launder money and even scam people.
Hackers can steal cryptos with the help of weak data protection, weak information security, and errors in code. With such, service providers are now taking all of these considerations when crypto projects are being launched.
With the trends above, it’s safe to say that buying cryptos now can be a good move. When you know what cryptos to buy, their potential to grow is high, which you can take advantage of. If you’re still indecisive about joining the wagon, keep checking these cryptocurrency trends.