Despite 2020 being the difficult year that it was, it resulted in an excellent year for the crypto and blockchain industries. The price of Bitcoin is up more than 300% YTD, after the official halving in May, and continues to show promise.

In addition to the wild growth of the crypto market’s top digital asset, we have seen the beginning of what mass adoption of crypto will look like as significant and reputable companies have entered the crypto space.

So what’s next for the crypto market? I predict that 2021 will be the year of mass adoption of crypto, as the U.S. dollar continues to decline, and Bitcoin will continue to dominate the market and headlines. Smart contracts will rise with greater utilization, and as the crypto world takes off, retail investors will switch from traditional banks to crypto services.

So, here are my top 2021 crypto predictions!

Road to Mass Adoption

In 2020 we saw the beginning of the mass adoption and widespread financial disruption from the crypto world. Major companies entered the space and have inspired more to do the same.

Additionally, many companies added Bitcoin to their balance sheet. MicroStrategy announced that it would purchase $175 million more Bitcoin, upping holdings to $425 million in Bitcoin that they plan to hold for a century (Coindesk). Long time Bitcoin bull and Twitter CEO Jack Dorsey announced that Square was adding $50 million in Bitcoin to their balance sheet and released how their company executed this effort by open-sourcing the documents (Forbes). Disclosed public companies alone hold 2.85% of all Bitcoin in circulating supply.

My prediction is that 2021 will be the year crypto goes mainstream and mass adoption goes into full effect. We will see institutions, corporations, and public companies rush to hedge their cash reserves into Bitcoin with more velocity, shocking the world and the crypto market with significant news announcements.  Voyager recently announced our institutional platform, providing an easy and efficient gateways for institutional investors to access the crypto economy.

Simultaneously, Voyager is seeing record-breaking retail growth. Retail investors are rushing in to invest in crypto, and be a part of this historic rise.

U.S. Dollar Weakens & Crypto Rises

In 2020, the Federal Reserve inflated the U.S. dollar by more than 15%, and 21% of all U.S. dollars in circulation were printed in 2020. The current rate of inflation shows no signs of slowing down. With necessary financial intervention and stimulus in the future, more and more dollars will be pumped into the economy, thus lowering their inherent value. Additionally, more and more people are doing their shopping online, and it’s estimated 40% to 70% of U.S. consumers will prefer to transact in digital mediums in the coming year.

A weakening U.S. dollar, while a tough pill to swallow for the lower and middle class, is a silver lining for Bitcoin, and is one reason why Bitcoin’s price has been skyrocketing. Bitcoin has a fixed inflation rate and is deflationary by design, with only 21 Million Bitcoin to ever be created in its existence, and an estimated over 3-Million Bitcoin permanently lost. This deflationary quality is one reason Bitcoin has been attracting an increasingly impressive list of institutional and corporate investors to ensure their annual productivity growth rate is greater than the 15% inflation rate of the dollar due to the unprecedented cash injection into the economy.

I think the Federal Reserve will continue printing dollars in 2021 to stimulate the economy, and the purchasing power of the dollar will drop as crypto rises.

Bitcoin

After the halving in May, Bitcoin put up an impressive showing in 2020 by breaking through its 2017 all-time high of $20,000, followed by a run to over $40,000 within the very first days of 2021. Every Bitcoin investor who has ever bought and held is now in profit.

Bitcoin has officially entered what is now considered price discovery. “Price discovery is a term that describes the process whereby the current market price of any good, service or financial security is established” (Capital.com).

More and more optimistic Bitcoin predictions by individuals of significant credibility, top hedge funds, public companies & major institutions have come to light since the historic breakthrough. Many agree that a 1 Trillion dollar market cap for Bitcoin is inevitable.

In 2021 Bitcoin will continue to establish itself as the ultimate inflation and economic hedge, continuing to out-perform every asset class.

Smart Contracts Shine

In 2020, we listed several coins from Smart Contract platforms like Polkadot, Avalanche, & Alogrand. These platforms bring groundbreaking ideas to fruition and create spaces that will help propel the crypto world’s mass adoption.

Avalanche is working to “build the internet of finance” where exchanging financial products and deploying digital assets is easy and unified, allowing one to trade cryptocurrencies, equities, alternative assets, and commodities, all in one place.

Algorand is embracing frictionless finance to be “the world’s first open, permissionless, pure proof-of-stake blockchain protocol that, without forking, provides the necessary security, scalability, and decentralization needed for today’s economy,” and to bring together traditional finance and decentralized financial businesses.

Polkadot is an open-source project founded by the Web3 Foundation, working to deliver the most robust platform for security, scalability, and innovation. It is a sharded protocol that enables blockchain networks to operate together.

This upcoming year Smart Contract platforms will rise into greater utilization as they establish their unique use cases and value propositions to the rising digital asset market, distinguishing themselves from Ethereum.

These smart contract platforms and others will usher in a new era of blockchain utility, decentralized finance and killer DApps - further expanding the adoption and utilization.

Utility Tokens & The Voyager Token

Utility tokens also had a strong year in 2020. Utility tokens are used as a means of exchange, to power unique tools and functionalities, as well as benefit and reward users on a wide-variety of platforms.

In 2021, Voyager will be completing our much-anticipated token swap, followed by the debut of our new and improved Voyager Loyalty Program. This Loyalty Program will power our interest booster, cashback rewards and savings for those who directly hold Voyager Tokens in their portfolio. The Voyager Token will also generate a 7% annual interest yield for the first year.

The Voyager Token will be an integral part of our ecosystem, rewarding our most valued customers who buy & hold the asset in their portfolio. As we expand internationally, grow our customer base, and introduce new features, the Voyager Token will incentive this growth, while unlocking advanced features on our platform.

The growth of utility tokens show the increase in confidence in blockchain technology and use cases that each platform has to offer. I believe 2021 will bring continued growth to these tokens as each platform continues to enhance their tokens' utility and bring their ideas to life.

The Switch From Banks to Crypto Continues

Between the bank’s interest rates remaining historically low and the U.S dollar uncertainty, retail customers are looking to take control of their financial future.

The crypto market provides a unique space for those who want to be in charge of their own money and invest in projects that they believe will grow their wealth. Additionally, the wave of institutions and companies starting to invest in Bitcoin is inspiring retail customers to do the same.

This year, retail customers will seek to replace traditional banking services with crypto alternatives. Voyager will spearhead this effort by offering USDC 8.5% interest-bearing debit cards and peer to peer payments.

2020 was critical for the crypto market, and I'm excited to see  my predictions come true in 2021. Let us know what you think of my 2021 crypto market predictions by tweeting at us at @investvoyager on Twitter!


The views, thoughts, and opinions expressed in this article belong solely to the author and not necessarily to Voyager Digital or any Voyager subsidiaries. Please do your own research and consult with an investment professional before making investment decisions.