Who benefited the most from Bitcoin and in what ways?

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Bitcoin, the world’s largest cryptocurrency, finally broke over its 2017 ATH on December 16th, thanks to exponential price increase on the charts. But it wasn’t done, not by a long stretch. In reality, at the time of writing, BTC was worth just more than $34,000 on the charts, having soared to as high as $64,000 less than two months earlier.

Now, while the degree of corrections in the said case has been understandably significant, the fact of the matter is Bitcoin, at press time, was still giving YTD returns of over 35%, with the 1Y change v. USD as high as 246%.

This implies that, ignoring the apparent, overblown complaints about volatility, Bitcoin has once again demonstrated its worth as a store of value asset. This story is especially compelling for cryptocurrency users in nations where individuals may not have easy access to high-performing assets.

It is in the context of the same that it’s worth looking at who benefitted the most from the world’s largest cryptocurrency’s bullish boom, with the same being the subject of Chainalysis’s latest report. Here, it’s worth noting, however, that the said report only looked at 2020’s realized gains. In light of the fact that 2021 saw BTC climb even higher, one can expect the figures for the same to be even higher.

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The most intriguing discoveries, on the other hand, were found towards the bottom of the charts. While everyone anticipated the US and China to lead from the front, what was unexpected was the disparity between well-to-do economic indicators and Bitcoin investments, and hence BTC realised benefits.

Consider this: nations like Vietnam and the Czech Republic, according to Chainalysis, are punching above their weight. Vietnam, a low-middle class nation rated 53rd in terms of GDP, was rated 13th in terms of Bitcoin investment profits, at $351 million. Similarly, while the central European country ranked 54th in terms of GDP, it ranked 18th when realised Bitcoin investments were included.

Source: Chainalysis

The most intriguing discoveries, on the other hand, were found towards the bottom of the charts. While everyone anticipated the US and China to lead from the front, what was unexpected was the disparity between well-to-do economic indicators and Bitcoin investments, and hence BTC realised benefits.

Consider this: nations like Vietnam and the Czech Republic, according to Chainalysis, are punching above their weight. Vietnam, a low-middle class nation rated 53rd in terms of GDP, was rated 13th in terms of Bitcoin investment profits, at $351 million. Similarly, while the central European country ranked 54th in terms of GDP, it ranked 18th when realised Bitcoin investments were included.

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On the contrary, there was some variation to this juxtaposition too, with India being the prime example. The world’s fifth-largest economy with a GDP of $2.9 trillion was ranked a “lowly 18th.” Chainalysis attributed the same to,

“This may be a result of the Indian government’s historical unfriendliness to cryptocurrency.”

It should be noted that such hostility has been observed in countries such as Turkey, where the Erdogan-led government and the central bank have repeatedly cracked down on crypto-holders and organisations dealing with them. Nonetheless, the country was placed 16th in terms of realised Bitcoin gains for 2020. It is reasonable to expect that this will not be the case in 2021, especially given recent events that have undermined the local community’s faith in the asset class.

However, the aforementioned conclusions should be taken in light of a recent event – El Salvador’s decision to declare Bitcoin legal money.

The Central American country doesn’t have strong GDP figures to boast of, with the same growing by over 3% just twice this century. What’s more, a World Bank report last year hypothesized that the country’s economy could contract by almost 9% on the back of the COVID-19 pandemic.

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For such a country, especially a country where financial inclusion is a struggle, the acceptance of Bitcoin as legal tender is a huge step, one that underlines the value associated with the world’s largest cryptocurrency.

With the aforementioned Chainalysis analysis adding bolstering BTC’s credentials as a legitimate store of wealth, and given that the currency is anticipated to rise much further, these realised profits are likely to be much larger this year.

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