Tag Archives: cryptocurrencies

Will 2021 be the best year for Bitcoin and Ethereum?

A spectacular surge


Last year Bitcoin was up 307% and Ethereum was up 440%.

This is a historic rise that can be explained as a consequence of the impact of the pandemic, the crisis that the restrictions imposed by the COVID19 brought about and the entry of institutional investors.

No wonder Bitcoin was born in 2009 as a response to the financial crisis (remember that on September 15 of the previous year Lehman Brothers went bankrupt). A protocol created by the mysterious Satoshi Nakamoto, as surprising as it was ahead of its time, exposed the weaknesses of fiat money and the role of financial intermediaries, whose credibility was already very much in question after big financial scandals were uncovered. Following the footseps of Bitcoin, new crypto-currencies burst onto scene, some of them — it must be said — technically superior… But as the saying goes, the early bird catches the worm, and so did BTC.

Later, thanks to the young genius Vitálik Buterin and his team, Ethereum was born, which broadened the horizons of the new blockchain technology much further with the creation of smart contracts. Its applications were almost unlimited: from deeds and logistics to data protection or polls in a safe, transparent and efficient way.

But we are not going to tackle the technical aspects here, we are simply going to make our prediction for 2021.

Crypto forecast for 2021

One thing is for sure: if the regulators had wanted to get rid of Bitcoin or Ethereum, they would have simply done it already.
On the other hand, the underlying technology, i.e. the Blockchain technology, is going to be implemented in a host of applications, including, needless to say, cryptocurrencies and money transfers.

In 2021, unfortunately, the effects of the restrictions caused by the Covid19 will be harsh, specially for certain self-employed workers and some sectors such as tourism, hotels, catering, events, culture… We addressed such issue earlier on Financial Translator (see What impact will the coronavirus have on my job?)

In a low returns scenario, institutional investors have begun to buy the two most reliable cryptocurrencies so far: Bitcoin and Ethereum. They have also bought Litecoin and a few of the over 2677 cryptomonies that currently exist.

This has resulted in a dramatic rise in their prices: as of January 3, 2021, 1 Bitcoin is quoted at £28,101 (i.e. $34,101 or £24,940) and 1 Ethereum is quoted at $775,83 (i.e. $604 or £536).

No one has a crystal ball. Financial Translator does not know the future, but if we had to make an estimate, we would dare say that both Ethereum and Bitcoin will continue to rise in 2021, both because of the socio-economic situation and the strengthening of these two cryptocurrencies. As usual, we will see constant fluctuations, which are part and parcel of any volatile market. We also believe that Ethereum will continue to grow even more than Bitcoin as stakeholders become increasingly aware of all the applications ETH has to offer and the potential revolution smart contracts may bring about. However, Bitcoin has an ace up its sleeve: it is limited, just like gold. There is a limit to the bitcoins that can be mined, so chances are that, unless regulators ban cryptos, its price will skyrocket in the coming years. By the end of 2021, the value of both cryptocurrencies may have doubled or even tripled.

We would also strongly recommend not investing more than 5% of your income or assets in cryptos. Let’s call a spade a spade: It is a risky investment. But… Why not more than 5%? Because if everything is lost, nobody goes bankrupt, not even gets in a pickle, because of loosing 5% of their capital (10% might well cause you some troubles); but on the other hand, if it continues to rise, the investor can make a huge profit.

It would be fantastic to witness the appearance of a social crypto, as we discussed on Wrögl: the miracle of a local currency. But it is a different kettle of fish, or a currency of a different colour 🙂

Greetings and happy new year! Take care.

IOTA (MIOTA)

IOTA, the next boom?

Many think that 2018 will be the year of IOTA and its currency MIOTA. To be honest, It blew my mind when I first learned about IOTA: a crypto which in spite of not being based on blockchain, increases transaction speed and does not need either miners or fees? WOW!!!! Can it be real?… Is MIOTA silently eating other cryptos’ lunch?

iotacoin

IOTA is focused on providing secure communications and payments between machines on the Internet of Things. It has a market cap of roughly $14 billion. I first heard about this coin when Bosch corporation acquired a large number of MIOTA tokens in 2017.

miota
                The Internet of things

Iota makes use of distributed ledgers. As I said before, unlike most cryptos, it does not use blockchain. Instead, it uses a technology its developers call the tangle, wich is based on a mathematical concept known as DAG (Directed Acyclic Graph). This design is what distinguishes MIOTA from other cryptos.

IOTA TANGLE
IOTA TANGLE

IOTA does not need miners, so there are no fees either. IOTA is 100% free to use, but it is still decentralised. Everybody plays an equal role in the network. Any time a transaction is made, the issuer must help authenticate to prevuious and also random transactions. It uses a series of cryptographic algorithms along with many other sophisticated techniques to do this work. Any device can manage it without too much effort.

A network like IOTA supports and facilitates a machine to machine economy and allows for two important features: microtransactions and speed (TSS, Transactions per Second). The more people that use the network the faster it becomes. That’s why, in the near future,  I dare say IOTA has good chances to become the underlying protocol behind the next revolution: the internet of things.

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If you are interested in getting some MIOTA you can get them on  Binance. Please note that you must buy MIOTA with ETH or BTC, so you will need to transfer them from another exchange or wallet.

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