5 Bitcoin Prediction For 2021

bitcoin predictions btc price trends crypto competition

The year 2020 has seen Bitcoin become relatively mature and stabilization of its prices all over the globe. The price has been rising steadily, and in 2021, it is expected to continue this overall trend. The continued investment from corporations and consumers alike will prove its maturity and worthiness to be a world currency. 

Challenges are still in the way of the currency, with Bitcoin prices fluctuating every day. With more and more people investing in digital currency and a continued increase in businesses accepting Bitcoin as payment for goods and services is a good sign though. Here is what we can expect in 2021 for BTC prices and crypto market share. 

1. Greater Acceptance By The Masses 

Bitcoin has not made much progress in the past decade due to a lack of adoption by major supporters. However, more and more people are turning to the currency as an option for trade. It is starting to attract attention, which is a good thing for the currency’s growth. 

In 2021, more investment firms will be willing to adopt the currency as well as approve it. Greater approval from major banks will also cause greater mainstream adoption. The support is good for the currency, and with a greater user base, it is more likely to stabilize. It will also get a sense of direction as it ventures into the tough currency market. More people accepting the currency also means trusting it and will use it more in everyday trade. 

2. Competition From Tech Giants 

There are a lot of participants in payment tech, and for Bitcoin, this means that it has ruffled some feathers in the past decade. With this consideration, Bitcoin is expected to face stiffer competition, especially as it relates to international payment transactions. International transactions are very expensive and can take days to resolve, which is where Bitcoin has gained a significant advantage over central banks. 

This opportunity is not lost on some of the biggest tech companies like Facebook and Google. Both moved forward with plans for launching their own digital currencies to aid in transactions by their massive user bases. The scale of their user base is what’s a potential risk for Bitcoin’s strangle hold on the market. 

While Facebook’s Diem isn’t exactly on the same level as Bitcoin, it could become a serious competitor if it catches on with Facebook’s billions of users. 

3. Competition From Central Banks 

About 80% of the world's central banks are currently working on a form of digital currency. For instance, China has gone further than any other nation in experimenting with digital currency. It is working on the digital Yuan, a currency that will likely reduce the demand for Bitcoin and other cryptocurrencies. The competition will also see a huge share of the market moving away from Bitcoin. Hence, it should be considered in its strategy for growth in such promising markets. 

4. A New Playing Field 

Regulatory concerns are rising for things such as the potential use of cryptocurrencies for fraud and anonymity. With this comes stricter regulations, and the government does not look like it will favor Bitcoin in any way. Regulations make the operational environment for Bitcoin more hostile. It will be forced to come up with new ways of handling the change headed its way. Regulation changes are hard to keep up with. 

A change in the administration means that some of Bitcoin's progress will be offset by a lack of attention on the currency. New rules are also expected to change things drastically, and the BTC currency will have a hard time trying to adapt to these changes. 

5. More Volatility 

Since Bitcoin is not directly associated with any obvious real-world phenomenon, it will change in difficult ways to explain or predict. Bitcoin is not tied to any monetary policy, and the market is not stable yet. The prices might increase in 2021, or take a change of direction in the opposite direction. 

The uncertainty is all due to the difficulty predicting how the cryptocurrency will fair in 2021. Right now a mere news bulletin about Amazon or a tweet from Elon Musk can cause massive shakeups in Bitcoin prices.

The Bottom Line On BTC

So, buckle up and expect the unexpected from Bitcoin as it faces challenges and competition in 2021. We look forward to a volatile market riding on stiffer regulation. The competition is also catching up, and times will be tougher for Bitcoin.

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