In the Mid 2021, Bitcoin’s Year So Far was a Roller-Coaster Ride

Bitcoin's year so far taught crypto investors that 'once a volatile coin, always a volatile coin'

Bitcoin is the world's most popular and valued digital currency in terms of market capitalization and investments. Although its price is not very attractive recently, the digital currency still manages to be at the top with more and more crypto investors pumping money into the Bitcoin sphere. Many crypto enthusiasts see Bitcoin as an alternative asset in the financial world and use it to make their daily transactions if needed. Remarkably, 2021 will remain a big year in Bitcoin's history. Bitcoin's year so far taught crypto investors that 'once a volatile coin, always a volatile coin.'

After its launch in 2009, bitcoin welcomed a new era of blockchain technology and digital currencies. Often considered synonymous to the cryptocurrency market, bitcoin saw its highest price in April that slumped to half today. But the price plummet didn't block crypto investors' belief in bitcoin. Even at the plunge, investors poured in more money with the belief that bitcoin will get over the 'hard times and make a remarkable comeback. Bitcoin's value is also considerably high, making it strong even when the market trend is saying otherwise. All the bitcoin in the world were roughly calculated to US$653 million as of May 30, 2021, which is way higher than the net worth of Amazon's founder Jeff Bezos. Today, the cryptocurrency journey towards investment and commercial mainstream has gathered pace, with major financial institutions and companies authorizing it as a valued asset. As we stand in the middle of 2021, Analytics Insight brings you Bitcoin's year so far in terms of market performance, volatility, price oscillation, major hits, etc.

The big hits and severe volatility

Undefined price oscillations are a part of bitcoin's everyday routine. Bitcoin has come across such severe volatility throughout its thirteen years of journey in the digital currency market. But what made the recent price swing differently was its steep rise and sudden fall.

Bitcoin started the year well-off with a good market presence and high performance. Following its drastic price spike, more crypto investors and newcomers pumped more money into bitcoin. The cryptocurrency more than doubled from the start of the year to its all-time high of US$64,895 in mid-April, all to experience a sudden slump that almost halved its price. But what made bitcoin fall crazy over a very short period of time? Elon Musk and the Chinese Government! Elon Musk, the tech entrepreneur, CEO of Tesla, and a former supporter of Bitcoin punctured its market reputation over a tweet in April. One day, all of a sudden, Musk Tweeted that Tesla won't accept bitcoin payments for their vehicle purchase, citing the environmental collapse the digital currency mining is causing. The same happened with China. The Chinese government has banned its people from mining bitcoin because of the insane amount of electricity it consumes. China mines around 75% of the total bitcoin mined across the globe. Being the biggest contributor to the digital currency market, its unpredicted ban hit the bitcoin prices very hard. Now, the Bitcoin price maintains to keep the US$34,000 mark.

According to JP Morgan analyst Nikolas Panigirtzoglou, many other investors who showed interest in Bitcoin so far have redirected their investments to gold or some other means because of its price fall.

Meme coins as a threat

Rising controversy over Bitcoin's fall and meme coin's price spike could change the tailwind of the cryptocurrency market. Dogecoin, a digital currency born out of memes and jokes, is performing well in the market. Many crypto investors also see Dogecoin as a potential replacement to plummeting Bitcoin prices. Even retail investors piled into digital assets in search of outsized gains. At a certain point, Dogecoin's worth surpassed that of Ford's.

Besides, two big meme stocks namely GameStop Corp and AMC Entertainment Holding have also soared high along with Bitcoin in the first quarter. Fortunately, one thing that made them stand strong was its unshaken price even when Bitcoin hit rock bottom. The asset has since decoupled. GameStop's price has gone up by 1,000%, while AMC Entertainment experiences a spike of over 2,500%.

Altcoins outperform bitcoin

When we talk about altcoins, the first thing that comes to our mind is Ethereum. Being an altcoin born out of Bitcoin's complex blockchain technology, Ethereum is the second-largest cryptocurrency in the world in terms of market cap. Although altcoins also faced some initial price plunges due to the bitcoin effect, they somehow managed to do better than its ancestor. Ethereum has grown by a whopping 1,200% compared to Bitcoin's 702% in one year.

Unfortunately, Bitcoin has a remote control for the digital currency market. When Bitcoin is bullish, so is the crypto market, when it is bearish, most of the market will decrease with it. Although there are exceptions, this is a common trend digital currencies follow. Fortunately, Ethereum and many other altcoins were on the linear side, escaping the side wind of Bitcoin's fall. Ethereum was designed to be the foundation for the future infrastructure of a more decentralized internet.