What to expect from bitcoin in 2021? Maybe bitcoin will be worth a million euros, maybe nobody even uses euros anymore, and maybe the bitcoin flag is proudly planted on the moon.
No one can be certain about how the bitcoin price will develop. But, based on past and current events and developments, we can share our expectations with you. Disclaimer: do not interpret our expectations as financial advice. Always conduct your own research and carefully consider your investments.
Now that’s out of the way, let’s get started!
Bitcoin halving may lead to a price increase
In 2020, the amount of newly created bitcoins will be halved. Currently, 12.5 newly created bitcoins are released onto the market with each transaction block that’s mined, as a reward for the work of a miner. In 2020, this reward will decrease to 6.25 bitcoins for each mined transaction block.
In crypto lingo, this process is called the Bitcoin block halving, which takes place roughly every four years. Sounds technical, and it is, but what’s important for you to know is that it can have a significant influence on the price.
If you paid attention during economics class in school, you’ll know that a price is determined by supply and demand. The block halving has a direct influence on the supply. Since fewer bitcoins are released onto the market, the supply will decrease. If the demand stays the same, the price will increase.
Whether this is actually going to happen in 2021 remains to be seen. But when we look at the past, we see that previous block halvings have always had an impact on the price.
There are other indications that lead some to believe the price will increase in 2021. One analyst applied a complicated economic model on Bitcoin. You can apply this model to commodities like gold and silver as well. If that model holds up in the future, it looks like bitcoin will be worth 100,000 dollars in 2021. These are exciting speculations!
RELATED: How to buy Bitcoin?
Bitcoin will be more user-friendly
We expect that executing bitcoin transactions will be a piece of cake in 2021. Anyone will be able to do it because applications and programs are becoming more and more user-friendly.
At the moment, Bitcoin is not quite there yet. You could compare Bitcoin with the internet in the 90s. Do you remember? That wonderful dial-up connection on your Windows 95 PC. After some beeps and strange noises, you were finally online. By the time your favorite website had loaded, the fun was already over: Mom had to make a phone call.
Bitcoin is still in that phase. You need some knowledge and experience to really understand Bitcoin’s possibilities and potential. But it will only get easier. By 2021, spending bitcoin will be as easy as swiping your credit card.
Bitcoin will be stronger than ever
With BLOX, you can buy bitcoin in just one minute. But behind that simple purchase, there’s an enormous structure at work. Each day, developers work on improving the Bitcoin network bit by bit. Think of aspects like speed, safety, and privacy.
The Lightning Network will make Bitcoin faster than ever. In 2018, the first lightning transactions took place, but the technique is still being further developed and improved. Who knows, we might all be using the Light Network by 2021. It may even be so that bitcoin transactions are automatically processed on the Lightning Network.
At the moment, Bitcoin can process seven transactions per second. With the Lightning Network, millions of transactions can be processed in merely a second. Additionally, the transaction fees will be drastically lowered.
Bitcoin is a complex network of thousands of computers. This ensures that Bitcoin as a payment system is extremely safe. If you’d want to shut down or manipulate the network as an individual, it simply cannot be done. Even when you work together, it is virtually impossible. Each day, more and more new computers connect to the network.
Privacy is another issue that Bitcoin tackles. With the increasing amount of digital payments, our bank accounts are increasingly monitored as well. Everything you buy with your debit card or credit card is recorded. What if this data falls into the wrong hands? Or what if it’s used for purposes that you do not agree with?
Developers are constantly working on solutions to improve the privacy of bitcoin. You may not have anything to hide, but you don’t have to share everything. That is what Bitcoin stands for as well.
In short, there are many exciting things to happen for Bitcoin in 2021. No one knows exactly what the future will bring, but we’re excited about the times to come! What do you think 2021 will bring for Bitcoin? Join the discussion in our Telegram community!
RELATED: How to Invest Safely in Bitcoin?