2021 saw cryptocurrency investors raking $162.7 billion in profits, as per a report by StockApps. The report stated a 400% increase in profit from 2020, as cryptocurrency profit was around $32.5 billion, a year earlier. USA accounted for the highest amount of profits for the year by collecting approximately $47 billion followed by countries such as United Kingdom, Germany, and Japan, in the order.
Insights from the report stated that cryptocurrencies bitcoin and ether accounted for 93% of gains made in 2021. Ether made gains worth $76.3 billion, while bitcoin made $74.7 billion. The demand for blockchain protocols ethereum and bitcoin increased in 2021. Demand for ethereum went up due to the adoption of decentralised finance (DeFi) systems, due to the number of protocols existing on the Ethereum network.
The report’s data stated that China’s ban on cryptocurrencies, especially on the mining activity, led to a mass exodus of crypto mining firms out of China. China’s slow growth rate was attributed with its regulatory crackdown against cryptocurrencies. Despite believing that bitcoin and other cryptocurrencies could lead to financial instability, China does not hold a negative outlook towards virtual currencies. The country is working to build the virtual version of its national currency yuan.
A drop in the number of cash based transactions has been seen as digital currency is expected to overtake fiat currency. South Africa made it to the list of top 50 countries to make cryptocurrency gains in 2021, by making $827.6 million in realised gains, which accounted for 0.51% of the overall realised gains.
(With insights from the StockApps report)