1. Is China at The Forefront of The CBDC And the Prospect of Currency Race?
2020 will be a successful year for decentralized digital currencies, as we accurately forecast last year (CBDCs). We should anticipate several new advances in this area in 2021, with 80 percent of central banks operating on CBDCs and the unseen demand from Libra (now named Diem), scheduled to start soon.
Although wholesale CBDC innovations are significant, central banks’ attention would most likely be drawn to retail CBDCs, as retail CBDCs are a huge game-changer. Unlike retail CBDCs, which are only between a banking system and banking and run “behind action sequences” from the public’s viewpoint, retail CBDCs enable the public to own a fully digital type of central bank currency, which is currently unavailable. We should anticipate some G20 countries to launch their proposals, much as certain nations from the Bahamas to the United Kingdom did in 2020 for some of their retail CBDC initiatives.
In reality, however, all hands will also be on China in 2021 as it continues to develop with its virtual RMB (dubbed DCEP), blazing the trail in terms of the future of finance. About 2 billion RMB ($300 million) worth of volume was paid back in over 4 trillion yuan utilizing the digital RMB during its most recent pilot period. The primary concern might not be whether China can decide to press on with this mission but how easily it will do so.
2. Are Traditional Investment Banks (And Private Banks) Interested in Bitcoin?
When it came to global players entering the crypto room, 2020 was a fantastic year, as we accurately expected. Not only did significant institutions such as JP Morgan and Standard Chartered begin to develop options for customers, but several others, including Citi and Deutsche Bank, started daily coverage of the asset class. When several banks continue to make their cryptocurrency proposals public in 2021, we should anticipate this process to escalate. This could help established buy-side companies enter the market since they are not only more secure trading with controlled intermediaries but are often required to do so through their own legislative or investor constraints in certain situations. If you were looking for a platform that could help you do secure trading then you should register yourself on the Bitcoin trader platform by clicking on the Crypto Genius Trading App.
While investment banks were the most aggressive players so far, investment corporations should be monitored. Although most large investment investors dismissed Bitcoin as a non-serious commodity (having no crypto-related goods to offer certainly didn’t help!), several smaller private banks did. We would anticipate forward-thinking private banks to evolve and see cryptocurrency as a differentiator offering to participate and generate additional business from the highly coveted high net wealth and family office customer base constantly trying to purchase Bitcoin.
3. Is the Taxman Offering Clarity on Crypto Taxes?
2020 would see floor advances in crypto taxes, as we rightly expected last year. Not only did it occur on the US IRS questionnaire that was sent to any American, but organizations such as the OECD have released excellent reports on the subject. According to the PWC Global Crypto Report, a growing range of tax authorities offer specific crypto tax advice. Although almost none of them advise on crypto investing and leveraging or crypto trying to carve, the rest already do so on issues such as crypto investment income and mining profits. In 2020, expect the degree of tax transparency to increase.
This is good news for the market, as tax transparency is a critical factor that brings retail investors peace of mind. On a realistic basis, the growth of the cryptocurrency industry in recent months has benefited many commercial and skilled traders, providing an incentive for inland revenue to collect what they think is owed, particularly in such a challenging economic climate!
4. Are Crypto Unicorns Being Crypto Octopuses as A Result of Mergers and Acquisitions: Find Out
Despite the economic downturn, 2020 was a banner year for cryptocurrency mergers and acquisitions. The overall valuation of crypto M&A in the first six months of 2020 seems to have already exceeded that of 2019, with the average transaction size rising from US$19.2 million to US$45.9 million, according to data.
In 2021, we should anticipate further crypto M&A operation, particularly when cryptocurrency unicorns gradually become crypto octopuses, investing some recent bull market profits on purchasing or investing in companies that provide complementary services to their new lineup. And in 2021, these crypto octopuses could be floating in Asian waters more than ever before, as a growing percentage of crypto M&A operations diverts attention from the Americas, with 57 percent of deals happening in APAC and EMEA in H1 2020.
5. Retail Investors Can Now Easily Purchase Bitcoin!
“Where Can I Go to Buy Bitcoin?” You May Wonder
This is a concern that any crypto enthusiast gets from their friends and family daily. My mother is an excellent example, as she desperately wanted to grasp what I do for a living after I offered her a Bitcoin as a present a few years back. The truth is that purchasing cryptocurrency has never been simpler. Not only are there various controlled fiat-to-crypto platforms in most modern countries, but the amount of people who have accounts with those markets has increased from 5 million in 2016 to over 100 million this year.
