Sign In

Crypto attracts more money in 2021 than all previous years combined

crypto 2021 conference

Venture capital funds have poured about $30 billion into crypto, or more than in all previous years combined for the little more than a decade-old technology. That’s almost quadruple the previous high of around $8 billion in 2018, or the year following Bitcoin’s more than 1,300 per cent breakthrough gain, according to transaction data compiled by PitchBook Data.

“We’ve moved beyond just digital gold. We’ve got financial services, art, gaming as a subcategory of NFTs, Web 3.0, decentralised social media, play-to-earn — all of that made investors think ‘we don’t have enough exposure,’“ said Spencer Bogart, general partner at San Francisco-based Blockchain Capital, one the largest investors in the industry after financing more than 120 companies since its inception in 2013.

2021 has been an important year for cryptocurrencies. The decade-old technology caught the attention of investors and regulators alike and managed to become a part of the mainstream.

According to crypto.com, the number of people holding cryptocurrencies globally doubled to about 220 million this year. Investors poured in about $30 billion into the crypto industry in 2021, more than in all previous years combined, per reports. From digital collectibles to crypto gaming, the industry secured billion-dollar investments.

The largest cryptocurrency bitcoin made some significant strides in its journey to be accepted by the traditional finance system. The legacy coin shot up to record levels of nearly $69,000, taking the total cryptocurrency market cap to new highs of nearly $3 trillion, having started off the year at around $29.000.

The first bitcoin exchange-traded fund (ETF) started trading, attracting good institutional interest. Many traditional banks like Goldman Sachs also announced plans to launch products that will allow using bitcoin as collateral for making cash loans to institutions.

Another important milestone for bitcoin this year was its acceptance as a legal tender in El Salvador. Citizens of the island nation can now buy or sell products and services using bitcoin as the currency.

Some new uses of crypto technology also made headlines this year. Non-fungible tokens or NFTs were introduced to provide unique ownership of digital art and music. But through the course of the year, NFTs expanded to other types of digital property, including digital real estate. The ease in the creation of an NFT in a dedicated marketplace gave independent artists a platform to present their art. NFTs have also become an extremely popular investment vehicle in the crypto industry, with sales of these digital assets setting new records at major auction houses. A land parcel on gaming platform Sandbox, for example, recently sold for nearly $4.3 million.

Share to Social Media